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<s>[INST] Summarize the judgementCivil Appeal No. 2999 of 1980.
From the judgment and order dated the 22nd April, 1980 of the High Court of Delhi at New Delhi in C.R. Petition No. 336 of 1979.
G.L. Sanghi, Mr. A.K. Verma and section Kashwa for the appellant.
D.D. Thakur, P.H. Parekh, P.K. Menon and R.K. Sharma for the respondent.
The Judgment of the Court was delivered by RANGANATH MISRA, J.
The landlord whose application for eviction of the tenant, respondent before us, was rejected by the High Court by reversing the order of the eviction passed by the Additional Rent Controller has come before this Court on obtaining special leave and the short point arising for consideration is as to the true meaning of a clause in the rent deed.
The respondent was admitted into tenancy of the premises in question under a lease deed dated 5th January, 1968.
Clause 12 thereof provided: "That the lessee shall use the premises for the purpose of Residential/Personal office only and Not for commercial purposes".
(underlinings are our own) The landlord, appellant before us, applied to the Controller on March 14, 1972, for eviction of the respondent under Section 14 (1) (e) of the Delhi Rent Control Act, 1958 ( 'the Act ' for short).
The tenant obtained leave to contest and pleaded, inter alia, that the premises were let out both for residential as also office and the composite purpose of the tenancy took the premises out of the purview of residential accommodation.
The Controller did not accept the defence and passed an order for eviction.
Thereupon, the tenant carried a revision to the Delhi High Court and reiterated his defence that the tenancy was not for residential purpose.
The High Court found that there was no infirmity in the finding about the bona fide requirement but adverting to the conclusion on the letting purpose held: "It is well known that premises may be let out for residence only, for use as an office, for use as a shop and for other com 54 mercial purpose.
Once any of the latter purposes is combined with the purpose of use as residence, the premises let out for a composite purpose and for residence only.
The meaning of the word 'office ', not defined in the Act, in the Chamber 's dictionary is a place where business is carried oh.
Office is certainly not residence and a letting purpose which includes office must be understood to include a purpose other than residence only".
And ultimately concluded by saying: "Clause (e) of Section 14(1) is available as a ground to seek eviction of tenants only, among other requirements, if the premises were let out for residence only and once the letting purpose is shown to be composite, an eviction petition under Section 14(1) (e), without more, must fail.
" The High Court rejected the landlord 's submission that the use of the word 'personal ' before 'office ' was intended to convey the idea that the tenancy was not for the purpose of accommodating a place of business.
Counsel for the appellant took us to the terms of clause 12 of the lease agreement and emphasised on the feature that commercial purposes were clearly kept out and the lease was for residence and authorised the location of a personal office.
He also relied upon the description of the premises as residential in the application made by the tenant to the controller for fixation of fair rent in respect of the very premises.
The word 'office ' is used in different senses and in each case that meaning must be assigned to it which conforms with the language used.
In Volume 67, Corpus Juris Secundum at page 96, the following statement appears: "The term 'office ' is one which is employed to convey various meanings, and no one definition thereof can be relied on for all purposes and occasions".
This Court has approved the observation of Lord Wright in Macmillan vs Guest, 1 where it was stated: "The word 'office ' is of indefinite content.
Its various meanings 55 cover four columns of the New English Dictionary. " See Smt.
Kanta Kathuria vs Manak Chand Surana(1).
In this view of the position the High Court was not right in picking one of the meanings given to the word in the Chamber 's dictionary and proceeding to the conclusion that 'office ' is certainly not residence and a letting purpose which includes office must be understood to include a purpose other than residence only.
Section 2(i) of the Act defines 'premises ' to mean "any building or part of a building which is, or is intended to be, let separately for use as a residence or for commercial use or for any other purpose . ." Respondent 's counsel has argued that tenancy under the Act can be for three purpose; (1) residential, (2) commercial and (3) for any other purposes depending upon the use for which the premises are let out.
Conceding that the definition is capable of such an argument being built up, a reference to the pleadings in this case shows that the permission in the rent deed of locating a personal office had been stated to be a commercial purpose.
Great care seems to have been taken by the landlord while inducting the tenant under the rent deed to put a total prohibition to commercial user of the premises.
That is why in clause 12 it has been specifically stated that it is "not for commercial purposes".
In the back drop of such a provision in the lease agreement, the true meaning of the words 'personal office ' has to be found out.
Law is fairly settled that in construing a document the ordinary rule is to give effect to the normal and natural meaning of the words employed in the document itself.
See Krishna Biharilal vs Gulabchand and Ors.
(2) This Court in D.D.A. vs D.C. Kaushish(3) observed: "There (at pages 28 29) 'Construction of Deeds and Statutes ' by Odger 's (5th ed.
1967) the First General Rule of Interpretation formulated is: 'the meaning of the document or of a particular part of it is therefore to be sought for in the document itself '.
That is, undoubtedly, the primary rule of construction to which Sections 90 to 94 of the Indian Evidence Act give statutory recognition and effect.
Of course, 'the document ' means 'the document ' read as a whole and not piecemeal.
56 The rule stated above follows logically from the Literal Rule of Construction which, unless its application produces absurd results must be resorted to first.
This is clear from the following passages cited in Odgers ' short book under the First Rule of Interpretation set out above : Lord Wensleydale in Monypenny vs Monypenny 1 said: "the question is not what the parties to a deed may have intended to do by entering into that deed, but what is the meaning of the words used in that deed; a most important distinction in all cases of construction and the disregards of which often leads to erroneous conclusions".
Brett, L.J. in Re Meredith, ex parte Chick 2 observed : "I am disposed to follow the rule of construction which was laid down by Lord Denman and Baron Parke.
They said that in construing instruments you must have regard not to the presumed intention of the parties, but to the meaning of the words which they have used.
" Since we agree with this exposition of the law reference to the oral evidence or even to the tenant 's documents would be wholly out of place.
The terms of the document if they make any good meaning must be given effect to.
All the provisions of the lease deed have to be read and in fact with the assistance of counsel we have read the same more than once during the hearing.
The parties to the document were anxious enough and took proper care in order to keep the user of the premises confined to residential purpose; that is why it was expressly stipulated in the lease to prohibit commercial user.
Even while permitting an office to be located, equal care was taken to put the word 'personal ' before 'office ' to convey the idea that the tenant would not be entitled to transact official business connected with his avocation.
Although ordinarily an office would mean the place where official business is transacted a personal office in contradistinction to an office simpliciter or a commercial office would be a place where an outsider would not normally 57 be admitted; commercial transactions would not take place; there would be no fixity of the location and the tenant would be entitled to use any portion of the premises as his personal office and the like.
Such a place if referred to as personal office would essentially be residential and obviously while entering into the present lease deed, the parties were not trying to create a lease of premises for any other purposes as now contended by Mr. Thakur for the respondent.
The High Court, therefore, went wrong in reversing the decision of the Rent Controller by merely relying upon clause 12 of the lease deed.
It is relevant to note the description of the premises as given in the lease deed itself.
Paragraph 2 of the document described the premises thus : "The lessor hereby leases to the lessee the following described premises of the entire house built on plot No. 125.
Greater Kailash I, New Delhi comprising of three bed rooms with two bath rooms, drawing cum dining room, one kitchen one front and central veranda, front and back lawn, garage, servant quarter, above garage, a servant W.C. and terrace.
" There was no description of any existing office room and available for such use to the tenant.
nor was space earmarked for any personal office out of this accommodation.
As indicated above it was in the discretion of the lessee to use any part as a personal office.
Every lessee, or for the matter of that every person maintaining an acceptable standard of living does set apart a portion of the accommodation available to him which can answer the description of a personal office.
Mr. Thakur placed reliance on another clause of the lease deed which reads as follows: "That the lessor shall pay all the taxes of any kind whatsoever including house tax, ground rent as are of may hereinafter be assessed on the demised premises by the municipality or any other authority whatsoever provided the premises are used for residence only.
" We do not think the terms of this clause support the stand of the lessee.
As contemplated under the Transfer or Property Act a document of lease normally provides the rights and obligations of both the 58 lessor and the lesses.
In stipulating the rent payable for the use and occupation of the premises the lessor had undertaken the liability of payment of taxes as described therein as long as the premises were used for residence only.
This clause necessarily means that what had been stipulated was only residential user.
It is appropriate to take note of the admission of Mr. Thakur that the lessor had been paying the taxes and the lessee has not been called upon to share the burden.
This clause is an added provision to clinch the point in dispute against the tenant.
We are, therefore, of the view that the High Court clearly erred in law in reversing the decision of the Controller allowing the eviction.
The appeal is allowed and the order of the High Court is set aside and the order of the Additional Rent Controller is restored.
Parties are directed to bear their respective cost throughout.
This is a litigation which began in 1970.
The tenant has been in occupation and continuing for about 14 years now after the application for eviction had been filed.
Ordinarily we would not have allowed any time to the tenant keeping this aspect in view.
But Mr. Thakur has urged upon us to take judicial notice of the fact that these days an alternative premises would be very difficult to find.
We allow time to the tenant until 30th December, 1984 to vacate the premises subject to furnishing usual undertaking within four weeks from today.
In the absence of the undertaking the tenant becomes liable to eviction after four weeks.
S.R. Appeal allowed.
[/INST]Prem Chand Sharma was admitted into tenancy of the suit premises under a lease deed dated 5th January, 1968, clause 12, thereof provided.
"That the lessee shall use the premises for the purpose of Residential Personal office only and not for commercial purposes.
" The landlord, appellant, applied to the Rent Controller on March 4, 1972, for eviction of the Respondent under section 14(1) (e) of the Delhi Rent Control Act, 1958.
The respondent tenant obtained leave to contest and pleaded inter alia that the premises were let out both for residential as also for office and the composite purpose of the tenancy took the premises out of the purview of residential accommodation.
The Controller did not accept the defence and passed an order for eviction.
In revision, however, the High Court rejected the land lord 's submission holding that the use of the word "personal" before "office" was intended to convey the idea that the tenancy was not for the purpose of accommodating a place of business and reversed the decision of eviction.
Hence the appeal by the landlord, after obtaining special leave of the Court.
Allowing the appeal, the Court ^ HELD: (1) The word "office" is used in different senses and in each case that meaning must be assigned to it which conforms with the language used.
Therefore, in the instant case, the High Court was not right in picking one of the meanings given in the chamber 's dictionary and proceeding to the conclusion that "office" is certainly "not residence" and a letting purpose which includes office must be understood to include a purpose other than residence only.
[54 A, 55A B] Macmillan vs Guest ; Smt.
Kanta Kathuria vs Manak Chand Surana, , referred to.
52 2:1.
Law is fairly settled that in construing a document the ordinary rule is to give effect to the normal and natural meaning of the words employed in the document itself.
[55 D E] Krishna Biharilal vs Gulab Chand and Others, [1971] Supp.
S.C.R. 27; D.D.A. vs D.C. Kaushish, (1974) 1 S.C.R. 535; Monypenny vs Monypenny, ; ; In re: Meredith, ex parte Chick, , referred to.
In the instant case it is clear that the parties to the document were anxious enough and took proper care in order to keep the user of the premises confined to residential purpose; that is why it was expressly stipulated in the lease to prohibit commercial user.
Even while permitting an office to be located, equal care was taken to put the word 'personal ' before 'Office ' to convey the idea that the tenant would not be entitled to transact official business connected with his avocation.
Although ordinarily an office would mean the place where official business is transacted, a personal office in contradistinction to an office simpliciter or a commercial office would be a place where an outsider would not normally be admitted; commercial transactions would not take place; there would be no fixity of the location and the tenant would be entitled to use any portion of the premises as his personal office and the like.
Such a place is referred to as personal office would essentially be residential and obviously while entering into the present lease deed, the parties were not trying to create a lease of premises for any other purposes.
In para 2 of the document, there was no description of any existing office room and available for such use to the tenant, nor was space earmarked for any personal office out of this accommodation.
It was in the discretion of the lessee to use any part as a personal office.
Every lessee, or for the matter of that every person maintaining an acceptable standard of living does set apart a portion of the accommodation available to him which can answer the description of a personal office.
Even the clause relating to payment of tax by the lessor do not support the stand of the lessee.
As contemplated under the Transfer of Property Act a document of lease normally provides the rights and obligations of both the lessor and the lessee.
In stipulating the rent payable for the use and occupation of the premises the lessor had undertaken the liability of payment of taxes as described therein as long as the premises were used for residence only.
This clause necessarily means that what had been stipulated was only residential user.
In fact, the lessor had been paying the taxes and the lessee had not been called upon to share the burden.
This clause is an added provision to clinch the point in dispute against the tenant.
Therefore the High Court, went wrong in reversing the decision of the Rent Controller by merely relying upon clause 12 of the lease deed.
[55C, 56F G, 57A B, D E, GH, 58 A B] 3.
Though the fact that the tenant has been in occupation for more than 14 years after the litigation began will disentitle him to any further time to vacate, taking judicial notice of the fact that these days an alternative premises would be very difficult to find, the Court considered it appropriate to grant time to the Respondent to vacate the premises upto 31st December, 1984 subject to furnishing usual undertaking within four weeks or to face eviction after four weeks.
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<s>[INST] Summarize the judgementAppeal No. 175 of 1951.
Appeal by Special Leave from the Order and Decree dated the 30th March, 1951, of the High Court of Judicature at Patna (Ramaswami and Rai JJ.) in Miscellaneous Appeal No. 19 of 1951 arising out of the Order dated the 18th December, 1950, of the 'Court of the Additional Sub Judge Second at Gaya in Title Suit No. 47 of 1950.
N. C. Chatterjee (Rameshwar Nath, with him) for the appellant.
M. C. Setalvad Attorney General for India, and Mahabir Prasad, Advocate General of Bihar (B. J. Umrigar with them) for the respondent.
February 3.
The Judgment of the Court was delivered by MAHAJAN J.
This appeal by special leave arises out of an application made by the State of Bihar against the Gaya Electric Supply Co. Ltd. under section 34 of the Indian Arbitration Act for stay of proceedings in a suit filed by the company on 28th September, 1950.
The facts relevant to this enquiry are these.
574 A licence of or the supply of electric energy in the town of Gaya was obtained by one Khandelwal in the year 1928 under the .
With the required sanction of the Government the licence was transferred to the company in 1932.
By a notification dated 23rd June, 1949, the licence was revoked by the Government with effect from 9th July, 1949.
Thereupon the company filed a suit against the State for a declaration that the revocation of the licence was arbitrary, mala fide and ultra vires.
During the pendency of the suit negotiations started between the company and the State for a settlement of the dispute and ultimately on 28th October, 1949, a deed of agreement was arrived at between them.
The effect of the agreement and the correspondence referred to therein was substantially as; follows : (a) That the company would withdraw the suit No. 58 of 1949 unconditionally on 25th October, 1949.
(b) That within three days of the withdrawal of ,the suit the State of Bihar would make an advance payment of rupees five lakhs to the company, and, simultaneously the company would formally hand over the possession of the undertaking to an authorized officer of the Government.
(c) That both parties will make their respective valuations within three months of talking over the undertaking and any balance of money found due to the company as per Government valuation will be paid to the company and in case of overpayment the excess paid to the company on account of the " on account payment " of rupees five lakhs will be refunded to the, Government.
(d) That in the case of any difference or dispute between,the parties over the payment of the balance which may be found due after valuation such dispute shall be submitted to the sole arbitration of a single arbitrator who should be a high government officer of the provincial government of rank equal to or higher than a Divisional Commissioner and his award shall be binding and final on both parties.
575 The arbitration clause is contained in a letter dated 13th October, 1949, and was substantially accepted by the company in its letter dated 17th October, 1949.
As set out by the State Government in its application under section 34, it runs as follows " In the case of any difference or dispute between the parties over the valuation as arrived at by the Government and that arrived at by the company, such difference or dispute, including the claim for additional compensation of 20 % shall be referred to arbitration. " In pursuance of the agreement the respondent took over the undertaking on 28th October, 1949, and also made a payment of rupees five lakhs to the company.
On the 19th January, 1950, the company sent a statement of valuation of the assets amounting to RS.
22,06,072, to the Chief Electrical Engineer, Bihar.
The Chief Electrical Engineer characterized the valuation of 22 lakhs by the company as fantastic and stated that according to a rough valuation the amount would be ' approximately five lakhs and that the final valuation would be settled after the company had furnished a detailed history of the plants and machineries.
The company declined to give any further details and stated that time was of the essence of the. contract and it would be extended from 28th January, to 15th February, 1950 On 6th April, 1950, the Chief Electrical Engineer intimated that the 'valuation amounted to Rs. 6,56,221.
No reply to this letter was received and the State Government intimated to the company that as difference and dispute had arisen relating to valuation, Mr. M. section Rao, I.C.S. was being appointed as sole arbitrator to decide the dispute.
On 28th September, 1950, the company instituted the suit, the subject matter the application for stay, after necessary notice under section 80 of the Code of Civil Procedure.
In the plaint it was alleged ,that as the State Government had failed and neglected to make its valuation or to make payment to the 576 company by the 15th March, 1950, it committed a breach of the agreement and by reason of this breach the company had rescinded the agreement and had forfeited the sum of five lakhs paid as advance by the State.
The company prayed inter alia for the reliefs of declaration that the, electrical undertaking belonged to them, for damages, for appointment of receiver and for injunction.
On the 9th October, 1950, the State Government filed the present appli cation under section 34, of the Indian Arbitration Act.
It was stated therein that the company had with a, dishonest and mala fide motive and with a view to avoid the decision of the matter in dispute in arbitration instituted the suit on incorrect and false allegations.
that the arbitration agreement was still subsisting and valid and binding on the parties and could not be taken as having been rescinded as alleged by the company, that the cause of action as alleged in the plaint being noncompliance with the agreement the suit arose out of and related to the agreement and was covered by the arbitration clause and that the State Government was ready and willing to have the dispute settled by arbitration.
The company denied the allegations of mala fides and pleaded that the arbitration clause was no longer in existence and that even assuming it to be in existence, the suit was in no way connected with the 'same and it was contended that the suit should not be stayed.
The subordinate judge held that the suit was no in respect of any matter agreed to be referred, and that the court had no ' jurisdiction to stay the proceedings.
In the result the stay application was dismissed.
Against this order the State Government appealed to the High Court.
The High Court held that the dispute in the suit was one which arose out of or was in respect of the agreement and that the question in the suit was directly within the scope of the arbitration clause.
By an order of this court dated 22nd May, 1951, the company was granted special leave ' under article 136(1) of the Constitution. ' 577 Section 34 of, the Indian Arbitration Act runs thus "Where any party to an arbitration comment Cost any legal proceedings against any other party to the agreement in respect of any matter agreed to be ,referred, any party to such legal proceedings may, apply to the judicial authority before which the proceedings are pending to stay the proceedings, and if satisfied that there is no sufficient reason why the matter should not be referred in accordance with the arbitration agreement and that the applicant was, at ,the time when the proceedings were commenced, and still remains, ready and willing to do all things necessary to the proper conduct of 'the arbitration, such authority may make an order staying the proceedings.
" From the language of the section it is quite clear that the legal proceeding which is sought to be stayed must be in respect of a matter which the parties have agreed to refer and which comes within the ambit of the arbitration agreement.
Where, however, a suit is commenced as to a matter which lies outside the submission, the court is bound to refuse a stay.
In the words of Viscount Simona L. C. in Heyman vs Daruins Ltd ' (1).
the answer to the question whether a dispute falls within an arbitration clause in a contract must depend on (a) what is the dispute, and (b) what disputes the arbitration clause covers.
If the arbitration agreement is broad and comprehensive and embraces any dispute between the parties "in respect of" the agreement, or in respect of any provision in the agreement, or in respect of anything arising out of it, and one of the parties seeks to avoid the contract, the dispute is referable to arbitration if the avoidance of the contract arises out of the terms of the contract itself. ' Where, however, the party soaks to avoid the contract for reasons dehors it, the arbitration clause cannot be resorted to as it goes along with other terms of the contract.
In other words, a party cannot rely on a term of the contract (1) , 578 to repudiate it and still say the arbitration clause should not apply.
If he relies upon a contract, be must, rely on it for all purposes .
Where, however, an arbitration clause is not so comprehensive and is not drafted in the broad language which was, used in the House of Lords,case, namely ' "in respect of" any agreement, or in respect of something, arising out of it", that proposition does not hold good.
The arbitration clause is a written submission agreed to by the parties in a contract and like every written submission to arbitration must be considered according to its language and in the light of the circumstances in which it is made.
Now as regards the first question, viz., what is the present dispute about, the answer is to be gathered from paragraphs 14 to 17 of the plaint.
It is averred therein that the Government of Bihar committed breach of the agreement and failed to make any, valuation of the undertaking or pay the balance of the compensation money, that time being of the essence of the contract, the defendant failed and neglected to complete the valuation within the time originally fixed or the extended time, and that by reason of the breach of contract the plaintiff rescinded the agreement and forfeited the sum of rupees five lakhs and that it is entitled to compensation for the wrongful deprivation of the use of its property.
No claim has been made in the plaint for the valuation of the undertaking or for the payment of any compensation for the undertaking; on the other hand, the claim in the suit is founded on the rescission of the agreement containing the arbitration clause and on a breach of that agreement.
These are matters which may well be said to arise out of the agreement and if the arbitration clause was broadly worded and stated that all disputes arising out of the agreement would be referred to arbitration, it could then probably have been said that the scope of the suit was within the ambit of the arbitration clause, but the clause here is differently worded.
The clause here is that if any difference.
or dispute arises between the parties over the payment of the 579 balance which may be found due after valuation such dispute shall be submitted to the sole arbitration of a single arbitrator.
The scheme of the agreement is that the Government was to make a valuation as laid ' down in the within three, months of taking over the undertaking and any balance of money found due to the company as per Government valuation was to be paid by the Government, and in case of over payment, the excess paid to the company on account of the "on account payment" of rupees five lakhs mentioned in paragraph 1 had to be refunded to government.
In the case of any difference between the parties over the valuation as arrived at by the Government and that arrived at by the company, such difference or dispute, including the claim for additional compensation of twenty per cent.
had to be referred to arbitration a scope of it is arbitration clause is a very narrow one.
It only confers jurisdiction on the arbitrator on the question of valuation of the undertaking pure and simple and does not say that all disputes arising out of the agreement or in respect of it will be decided by arbitration.
Questions relating to the breach of contract or its rescission are outside the reach of this clause.
The arbitrator has not been conferred the power by this clause to pronounce on the issue whether the plaintiff was justified in claiming that time was of the essence of the contract and whether the State Government committed a breach of the contract by not making a valuation within the time specified.
This clause is therefore no answer to the company 's querry "Show me that I have agreed to refer the subject matter of the suit to an arbitrator.
" Besides this clause in the agreement there is nothing else which can deprive the court of its jurisdiction to decide the plaintiff 's suit as brought.
Ramaswami J., with whom Rai J. concurred, held that upon a perusal of the term,; of the contract and of the correspondence it was obvious that no stipulation was made that the compensation money 75 580 should be paid within the period of three months, that on the contrary, the intention of the parties that the Government would pay compensation money only after the award had been made by the arbitrator.
Now this is the very point which would be in issue in the suit itself, and the learned Judge was in error in considering and deciding this point in this enquiry under section 34.
The validity of the plaintiff 's contention in the suit cannot be gone into by that court exercising jurisdiction under this section as its function is a very limited one.
The only point in such cases to be decided is whether the claim which is brought whether it is good, bad or indifferent comes within the submission to arbitration.
It may be that there are grounds upon which the defendant would be able to satisfy the proper tribunal that the plaintiff 's claim was frivolous and vexatious, but those considerations, as pointed out by Banks L. J in Monro vs Bognor Urban Council (1), are material only if the question to be considered is whether the case made was a frivolous and vexatious one and ought to have had no weight at all upon the question of what the plaintiff 's claim in fact was and one can only find out what his claim is by looking at the plaint.
The learned Judges in the High Court seem to have thought that the arbitration clause here had been drafted broadly and that all "disputes arising out of or in respect of the agreements were referable to arbitration.
Their reliance on the decision of the Calcutta High Court in Harinagar Sugar Mills Ltd. vs Skoda India Ltd.(") in support of the decision indicates the error.
In that case the arbitration clause was drafted in a comprehensive language and stated that a dispute arising out of the agreement had to be referred to arbitration.
Their reference to the case of Governor General in Council vs Associated Livestock Farm Ltd. (3) also shows that they were under the same erroneous impression.
In this case the arbitration clause was in these terms : (1) [1915] 3 K.B. i67.
(2) (3) A.I.R. 1948 Cal, 230, 581 "Any dispute or difference arising out of the contract shall be referred to the arbitration of the officer sanctioning the contract whose decision shall be final and binding.
" It is obvious that these decisions could have no relevance to the arbitration clause as drawn up in the present case.
If the nature of the claim is as we have indicated above, it seems plain that it does not come within the scope of the submission.
In our judgment, therefore, the decision of the learned Subordinate Judge was right and the Judges of the High Court were in error in reversing it.
In the result the only course open to us is to allow the appeal with costs and to say that the plaintiff 's claim is not within the scope of the submission and that the petition under section 34 was rightly dismissed by the Subordinate Judge.
Appeal allowed.
Agent for the appellants Rajinder Narain.
Agent for the respondent P. K. Chatterji.
[/INST]K, H and M filed four suits each against four sets of defendants in respect of different sets of plots under section 175 U. P. Tenancy Act, 1939.
Since similar points were involved the twelve suits were tried together and were disposed of by a common judgment decreeing them.
Twelve decrees were prepared and the defendants preferred twelve appeals to the Additional Commissioner.
Three appeals by one set of the defendants B were dismissed for default and the remaining nine were dismissed on merits.
Against the dismissal of the nine appeals on merits the three sets of defendants preferred nine second appeals before the Board of Revenue but they were dismissed as barred by res judicata on May 7, 1954.
In November, 1954, the appellants filed petitions for special leave before the Supreme Court and on April 18, 1955, special leave was granted.
In July 1954, the villages in Which the lands in suit were situate came under consolidation operations under the U. P. Consolidation of Holdings Act, 1953, and the operations were completed by the publication of a notification 218 under section 52 of the Act on October 17, 1953.
The appellants did not file any objections before the consolidation authorities.
The respondent contended that in view of the consolidation operations the appeals before the Supreme Court had become infructuous.
Held, that the appeals had not become infructuous.
There was nothing in the U. P. Consolidation of Holdings Act, 1953, as it stood during the period the village in suit was under consolidation operations which could have in any way affected these appeals, during or after the consolidation operations.
The subsequent Amending Acts did not affect the appeals as they were prospective in operation and applied only to cases where the consolidation operations were started after the Amending Acts had come into force.
Held, further that the appeals before the Board of Revenue were not barred by resjudicata.
It was essential for the bar of res judicata that the previous and judication must have been between the same parties.
The three suits in which judgments had become final were against one B and not against any of the appellants .
The matter in issue in those three suits was different from that in the other nine suits as each of the suits related to different plots.
The common judgment was really twelve judgments in the twelve suits.
Badri Narayan Singh vs Kamdeo Prasad Singh, (1962) 3. section C. R. 759 referred to.
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<s>[INST] Summarize the judgementil Appeals Nos.
469, 470,506, 507 and 529 to 534 of 1962.
Appeals by special leave from the judgment and order dated December 18, 1961, of the Madhya Pradesh High Court in Misc.
Petition Nos. 24, 29, 42, to 45, 58, 70, 95 and 213 of 1960.
WITH Petitions Nos. 70 and 71 of 1962.
Petition under article 32 of the Constitution of India for enforcement of Fundamental rights.
Sachin Chaudhri, B. Sen, J. B. Dada chanji, O. C. Mathur and Ravinder Narain, for the appellants (in C. As.
469 and 470/62) and the Petitioners (in Petitions.
Nos. 70 and 71 of 62).
A. V. Viswanatha Sastri, R. Ganapathy Iyer and G. Gopalakrishnan, for the respondent (in C. As.
469 470, 506 and 507 of 62), Respondents Nos. 1 and 3 (in C. As.
529 to 534/62) and Respondent No. 1 (in Petn.
Nos. 70 and 71/62).
B. Sen and I. N. Shroff, for the appellants (in C. As.
506 and 507/62).
175 N. C. Chatterjee, Y. section Dharmadhikaree and M. section Gupta, for the appellants (in C. As.
529 to 534 of 62).
I. N. Shroff, for the respondents Nos. 2 and 4 (in C. As.
529 to 534 of 62).
September 24.
The judgment of the Court was delivered by GAJENDRAGADKAR, J.
These ten appeals and two writ petitions have been placed for hearing together in a group, because they raise common questions of law.
The appellants in these matters are all colliers holding mining leases under the Government of Madhya Pradesh for the extraction of coal from collieries situated in the Chhindwara District.
The respondent, Janapada Sabha, Chhindwara, has issued notices against them calling upon them to pay coal tax " 'for coal manufactured at the mines, sold for export by rail or sold otherwise than for export by rail within the jurisdiction of the original Independent Mining Board for the said area It appears that the mining area in question was within the territorial limits of the Independent Mining Local Board which had the status and powers of a District Council under the Central Provinces Local Self Government Act, 1920 (hereinafter called the Act).
The respondent Sabha is the successor of the said Mining Board and, therefore, claims to be entitled to continue the levy and recover the tax in question.
On March 12, 1935, the Mining Board exercising its powers under section 51 of the Act, resolved to levy coal tax, and accordingly, the first imposition made by it received the sanction of the local Government on December 16, 1935, as per Notification No. 8700 2253 D VIII.
This notification came 'into force from January 1, 1936.
On December 16, 1935, the local Government notified the rules for the assessment and 176 collection of the tax which it had framed in exercise of the powers conferred on it by section 79 (1), clauses (xv), (xix) and (xxx).
Rule 2 of these Rules provided that the tax shall be payable by every person, firm or company holding a mining lease for coal within the limits of the Independent Mining Local Board 's jurisdiction.
Rule 3 provided that the tax shall be levied @ three pies per ton on coal, coal dust or coke manufactured at the mines, sold for export by rail or sold otherwise than for export by rail within the territorial jurisdiction of the Independent Mining Local Board.
In 1943, the words " 'coke manufactured at the mines" were deleted from Rule 3 and the tax was confined to coal and coal dust.
The rate thus prescribed was increased from time to time.
On December 22, 1943, the rate was made 4 pies per ton; on July 29, 1946, it was made 7 Pies, per ton; and on July 1. 9, 1947, it was made 9 pies.
The Mining Board continued to recover the tax at the said rates until the Act was repealed in 1948 and in its place was enacted the Central Provinces and Berar Local Self Government Act, 1948 (No. 38 of 1948).
The respondent Sabha has now taken the place of the said Mining Board and has issued the notices against the several appellants, calling upon them to pay the coal tax for the different periods mentioned in the said notices.
The appellants in Civil Appeals Nos.
469 and 470 of 1962 are : The Amalgamated Coalfields Ltd. and The Pench Valley Coal Co. Ltd. They are companies in operated under the Indian Companies Act, 1913, andor both have Shaw Wallace & Co., Ltd., as their Managing Agents.
On August 23, 1958, notices were served on the two appellants calling upon them to pay Rs. 21,898/ 64 np and Rs. 11,838/9 np respectively as tax assessed @ 9 pies per ton from ,,January 1, 1958, to June 30, 1958: This tax was claimed in respect of coal which included coal despatched by the appellants outside the State of 177 Madhya Pradesh.
The validity of these notices was challenged by the appellants in this Court by their Writ Petition 'No. 31 of 1959.
On February 10, 1961, the said writ petition was dismissed by this Court and it was held that the notices served on them were valid (Vide The Amalgamated Coalfields Ltd. vs The Janapada Sabha, Chhindwara(1).
On September 13, 1960 and March 2, 1961, two notices of demand were served on the appellants calling upon them to pay Rs. 1,16,776/25 nP. and Rs. 65,261/19 nP. respectively in regard to the tax assessed @ nine pies per ton on all coal despatched by the appellants from their collieries for the half years ending June 30, 1958.
December 31, 1958, June 30), 1959, December 31 1959, June 30, 1960 and December 31, 1960.
The appellants challenged the validity of these notices by a Writ Petition filed by them in the High Court of Madhya Pradesh on April 1.2, 1961 (No. 95 of 1961).
Whilst the said writ petition was pending before the High Court, the appellants filed another writ Petition in the same High Court (No. 213 of 1961).
By this writ petition, the appellants challenged the validity of notices issued against them on June 9, 1959, by which coal tax was demanded from them for a period between April 1, 1951 to December 31, 1957.
This tax was levied in respect of coal despatched by the appellants outside the State of Madhya Pradesh.
The amounts demanded were Rs. 1,92,144/66 nP. and Rs. 68,319/36 nP. respectively.
These two petitions along with eight others were heard together by the High Court.
So far as the appellants ' petitions were concerned, the High Court has held that the appellants ' claims were barred by res judicata by reason of the earlier decision of this Court in the case of the Amalgamated Coalfields Ltd. (1).
The appellants then applied for and obtained special leave from (1) ; 178 this Court on April 23, 1962 and it is by special leave thus granted to them that they have come to this Court in Civil Appeals 469 & 470 of 1962.
The appellants have also filed two Writ Petitions Nos. 70 & 71/1962 under article 32 of the Constitution.
By these writ petitions, the two appellants challenged the validity of the notices served on them on Julie 9, 1959 as well as on September 13, 1960.
The appellants ' case is that these notices are illegal and without jurisdiction and so, they want them to be quashed by an appropriate writ or order issued against the respondent in that behalf.
Thus, the two appellants, the Amalgamated Coalfields Ltd., and the Pench Valley Coal Co. Ltd.,, arc concerned with the two appeals Nos 469 & 470/1962) and Writ Petitions 70 & 71/1962.
The other appeals arise from the writ petitions filed in the High Court of Madhya Pradesh by the respective appellants which were tried along with the writ petitions filed by the Amalgamated Coalfields Ltd. & Anr.
In dealing with these writ petitions, High Court has held that the decision of this Court is the case of Amalgamated Coalfields Ltd.(1) concludes the points raised by them in challenging the validity of the notices, and so, following the said decision, the High Court has dismissed all the said petitions.
The appellants applied for and obtained special leave to come to this Court against the said decisions and it is with the special leave thus granted to them that these appellants have come before us.
Civil Appeal No. 506 arises from the decision of the High Court of 'Madhya Pradesh dismissing the writ petition filed before it by the appellant, the Central Provinces Syndicate (P) Ltd.
By its writ petition the appellant had challenged the validity of the notice served by the respondent calling upon it to pay arrears of the tax amounting to Rs. 20,776/88 nP. being arrears from April 1, 1951 to June 30, 1959.
(1) ; 179 It appears that for the said period, the appellant had been taxed by the respondent, but the said tax was not imposed on coal which had been transported by the appellant outside the limits of the State of Madhya Pradesh.
The respondent now sought to reopen the assessment levied against the appellant for that period by including a claim for tax in respect of coal sold by the appellant outside the limits of the State.
The High Court has rejected the Writ Petition and that decision 'has given rise to Civil Appeal No. 506 of 1962.
Civil Appeal No. 507 of 1962 arises from a writ petition filed by the appellants M/s. Kanhan Valley Coal Co. (Private) Ltd., in the High Court of Madhya Pradesh in which the validity of the notice issued by the respondent calling upon the appellants to pay the coal tax amounting to Rs. 10,970/ as arrears from April 1, 1951 to June 30, 1959 has been challenged.
The High Court has dismissed the writ petition, and so, the appellants have come to this Court by their Appeal No. 507/1962.
Civil Appeals Nos.
529 to 534 of 1962 similarly arise out of six writ petitions filed by the appellants M/s. Newton Chickli Collieries (P) Ltd. & five others in the High Court of Madhya Pradesh challenging the validity of the notices of demand served on them to recover by way of arrears coal tax for the periods mentioned in the notices in regard to coal sent by them outside the State of Madhya Pradesh for export.
These writ petitions were dismissed by the High Court, and the appellants have, therefore, come to this Court by appeals Nos.
529 534/1962.
That, in brief, is the genesis of the ten appeals and two writ petitions which have been grouped together for hearing in this Court.
It will thus be seen that Civil Appeals Nos.
469 & 470/1962 and Writ Petitions Nos.
70 & 71/1962 raise a preliminary question about the applicability 180 of the doctrine of res judicata to writ petitions filed under article 226 or to petitions under article 32, whereas the said appeals and writ petitions as well as the other appeals raise an additional question about the validity of the notices issued against the respective appellants.
We would, therefore, deal with civil appeals Nos.
469 and 4 70/1962 and Writ Petitions Nos. 70 and 71/1962.
Our decision in these matters will govern the other appeals in this group.
The first point which falls for our decision, in these appeals is one of res judicata.
The High Court has held that the challenge made by the appellants against the validity of the demand notices issued against them by the respondent is barred by res judicata by virtue of the decision of this Court in the earlier case brought by the appellants themselves before this Court.
The Amalgamated Coalfields Ltd.(1) Before dealing with this point it is necessary to refer to the said decision.
In that case, the validity of the impugned notices was challenged on two grounds ; it was urged that the levy of the tax by the Independent Mining Board was invalid at the date of its initial imposition in 1935 and so, the respondent Sabha which was the successor of the said Mining Board could claim no authority to continue the said tax.
This contention was based on the assumption that before the power conferred by section 51 of the Act could be exercised,, the previous sanction of the Governor General had to be obtained, or that there should be fresh legislation in that behalf.
This Court held that the Act having received the assent of the Governor General, its validity cannot be challenged in view of the saving clauses in the proviso to section 80A (3) and section 84(2) of the Government of India Act, 1915.
That being so, it was not open to any party to suggest that any subsequent amendments of the Government of India Act could affect the continued validity and operation of the Act.
The second contention raised was one of construction.
It was urged (1) ; 181 that on a fair construction of section 51, the coal tax was excluded from the purview of the local authority.
The This argument was based on the opening clause of section 51 which provided that its provisions would operate subject to the provision of any law or enactment for the time being in force.
It was suggested that this clause took in the provisions of section 80A(3) of the Government of India Act read with the Scheduled Taxes Rules framed under that section, but this argument was also rejected.
It appears that at the hearing of the petition, the appellants also attempted to take an additional point against the validity of the.
impugned notices on the ground that the rate of tax which had been increased from 3 pies to 9 pies per ton was invalid.
The appellants ' case was that this increase was effected after the commencement of the Government of India Act, and so, it was invalid.
This argument was not considered by the Court, because it was not even hinted in the petition filed by the appellants and the Court thought that it would not be proper to permit the appellants to raise that point at that stage.
That is how the appellants ' challenge to the validity of the impugned notices served on them on August 23, 1958 was repelled and the writ petition filed by them in that behalf was dismissed.
It appears that the authority of the Janapada Sabha to levy the impost under s.51 of the Act was challenged on another ground in the case of Ram Krishna Ram Nath v, Janapad Sabha (1).
This time the attack against the competence of the janapad Sabha proceeded on the ground that in repealing the Act of 1920, the subsequent Act of 1948 had not provided for the continuance of the said power in the janapad Sabhas which were the successors of the Independent Mining Boards.
Section 192(c) purported to provide that all rates, taxes and cesses due to the District Council, Local Board or Independent Local Board shall be deemed to be due to the Sabha to (1) [1962] Supp. 3 S.C.R. 70. 182 whose area they pertain.
But it was obvious that this clause could apply to, and save, only rates, taxes and cesses already due; it did not authorise the imposition of fresh cesses, taxes or rates in future.
Having realised that the relevant provision did not save future imposts, an amending Act was passed in 1949 by which the said saving was extended to include the right of the janapad Sabhas to continue the levy of the impugned tax and this amendment was made retrospective f from June 11, 1948, when the parent Act had come into force.
In the case of Ram Krishna (1) the validity and effectiveness of this amendment of 1949 was challenged.
It was thus a basic challenge to the power of the janapad Sabhas to levy any impost on the ground that the subsequent amendment was invalid.
This Court repelled the said challenge and held that the retrospective operation of the amendment was valid.
According to this decision, the Provincial Legislature was competent to legislate for the continuance of the tax, provided the relevant conditions of s.143(2) of the Government of India Act 1935 were satisfied.
These conditions required that the tax should be one which was lawfully levied by a local authority for the purposes of a local area at the commencement of Part III of the Government of India Act; that the identity of the body that collects the tax, the area for whose benefit the tax is to be utilised and the purposes for which it is to be utilised continue to be the same, and that the rate of the tax is not enhanced nor is its incidence materially altered, so that, in substance, it continues to be the same tax.
Since these tests were satisfied by the impost levied by the janapad Sabha, it was held that the impost was valid and that the retrospective amendment of s.192 was effective.
The present proceedings constitute a third challenge to the validity of the notices issued by the janapad Sabha, and as we have already seen, the (1) [1962] Supp. 3 S.C.R. 70.
183 challenge made by the appellants by their writ petitions before the High Court has been repelled on the preliminary ground that it is barred by res judicata.
In that connection, the first question to consider is whether the general principle of res judicata applies to writ petitions filed under article 32 of the Constitution.
This question has been considered by a special Bench of this Court in the case of Pandit M. section M. Sharms vs Dr. Shree Krishna Sinha (1).
Chief justice Sinha, who delivered the unanimous opinion of the Court, has answered this question in the affirmative.
In that connection, the learned Chief justice has referred to an earlier decision of this court in Raj Lakshmi Dasi vs Banamali Sen, (2) where it has been laid down that the principle underlying res judicata is applicable in respect of a question which has been raised and decided after full ' contest, even though the first Tribunal which decided the matter may have no jurisdiction to try the subsequent suit and even though the subject matter of the dispute was not exactly the same in the two proceedings.
It ought to be added that the Tribunal which had tried the first dispute in that case was a Tribunal of exclusive jurisdiction.
Then the points raised on behalf of the petitioner Sharma were considered and it was noticed that, in substance, they were the same points which had been agitated before this Court on an earlier occasion and had been rejected.
"In our opinion", said the judgment, "the questions determined by the previous decision of this Court cannot be reopened in the present case and must govern the rights and obligations of the parties which as indicated above, are substantially the same.
" Thus, this decision shows that even petitions filed under article 32 are subject to the general principle of res judicata.
The question about the applicability of the doctrine of res judicata to the petitions filed under (1) (2) ; 184 article 32 came before this Court in another form in Daryao vs The State of U. P. (1), and in that case it has been held that where the petition under article 226 is considered on the merits as a contested matter and dismissed by the High Court, the decision pronounced is binding on the parties, unless modified or reversed by appeal or other appropriate proceedings under the Constitution, and so, if the said decision was not challenged by an appropriate remedy provided by the Constitution, a writ petition filed in respect of the same matter would be deemed to be barred by res judicata.
Therefore, there can be no doubt that the general principle of res judicata applies to writ petitions filed under article 32 or article 226.
It is necessary to emphasise that the application of the doctrine of res judicata to the petitions filed under article 32 does not in any way impair or affect the content of the fundamental rights guaranteed to the citizens of India.
It only seeks to regulate the manner in which the said rights could be successfully asserted and vindicated in courts of law.
The question in the present appeals, however, is somewhat different.
The notices which are challenged by the appellants in the present proceedings are in respect of the tax levied for a period different from the period covered by the notices issued on August 23, 1958 which were the subject matter of the earlier writ proceedings (The Amalgamated Coalfields Ltd. ( 2 ) ) .
Where the liability of a tax for a particular year is considered and decided, does the decision for that particular year operate as res judicata in respect of the liability for a subsequent year ? In a sense, the liability to pay tax from year to year is a separate and distinct liability; it is based on a different cause of action from year to year, and if any points of fact or law are considered in determining the liability for a given year, they can generally be deemed to have been considered and decided in a collateral and incidental way.
The (1) ; (21 ; 185 trend 'of the recent English decisions on the whole appears to be, in the words of Lord Radcliffe, ',,that if is more in the public interest that tax and rate assessments should not be artificially encumbered with estoppels (I am not speaking, of course, of the effect of legal decisions establishing the law, which is quite a different matter), even though in the result, ' some expectations may be frustrated and some time wasted." (vide Society of Medical Officers of Health vs Hope Valuation Officer (1)).
The basis for this view is that generally, questions of liability to pay tax are determined by Tribunals with limited jurisdiction and so, it would not be inappropriate to assume that if they decide any other questions incidental to the determination of the liability for the specific period, the decisions of those incidental questions need not create a bar of res judicata while similar questions of liability for subsequent years are being examined.
In that connection, it would be interesting to refer to four English decisions.
In the case of Broken Hill Proprietary Co. Ltd. and Municipal Council of Broken Hill, (2) the question which fell for decision was how the average annual value of a mine for rating purposes had to be determined, and it was held by the Privy Council that the said value was to be ascertained by dividing the value of the output during the three years by three, not by multiplying it by 205 and dividing it by 365.
One of the points which the Privy Council had to consider was whether a contrary decision reached by the High Court of Australia between the parties as to the valuation for a previous year, operated as res judicata.
In rejecting the plea that the principle of res judicata applied, Lord Carson.
observed that ""the decision of the High Court related to a valuation and a liability to a tax in a previous year, and no doubt as regards that year, the decision could not be disputed.
The present case relates to a new question, viz., the valuation for a different year and the liability for that year.
It is not (1) , 563, (2) 186 eadem questio, and therefore, the principle of res judicata cannot apply." (p. 100).
It, however, appears that in the same year, the Privy Council came to a somewhat contrary decision in the case of Hoystead vs Commissioner of Taxation.(1) In that case, the question which arose for decision was about the deduction claimable under ther elevant provision of the Land Tax Assessment Act, 1916 (Aust.) Upon the assessment for 1919 20, the Commissioner allowed only one deduction of 5,000 lbs.
contending that the beneficiaries were not joint owners within the meaning of the Act.
The case was then stated to the full Bench which upheld the Commissioner 's view and rejected the argument that the Commissioner was estopped from coming to that conclusion in view of his decision in a previous year.
When the matter went before the Privy Council, it reversed the decision of the Full Court, because it held that the Commissioner was estopped, even though in the previous litigation no express decision had been given whether the beneficiaries were joint owners, it being assumed and admitted that they were, and the Privy Council thought that the matter so admitted was fundamental to the decision then given.
It would thus be seen that this decision applied the principle of res judicata even where there was no express decision on the point, but the point had been conceded in the earlier proceedings.
In 1960, the House of Lords had occasion to consider this question in the case of Society of Medical Officer of Health (2).
We have already quoted one statement of 'the law from the speech of Lord Radcliffe in that case.
In that case, the main reason given for repelling the application of the principle of res judicata in rating cases, was that the jurisdiction of the Tribunal which deals with those cases is limited, in that its function begins with and ends with deciding the assessment or liability of a person for a terminable period.
Besides, it was (1) (2) , 563.
187 held that the position of a valuation officer is that of a neutral official charged with the recurring duty of bringing into existence a valuation list, and he cannot properly be described as a party so as to make the proceedings a lis inter partes.
In coming to the conclusion that the doctrine of res judicata would not apply in such cases, Lord Radcliffe was influenced by the consideration that if decisions in rating cases are to be treated as conclusive for all time that Would be to impose a needlessly heavy burden upon the administration of rating (p.566).
This decision purported to approve of the view taken in the case of the Broken Hill Proprietary Co. Ltd.(1) and to distinguish the view taken in the Hoystead case.
(2) Lord Radcliffe had occasion to return to the same subject again in Gaffoor vs Income tax Commissioner.
(3) Speaking for the Privy Council, Lord Radcliffe considered the problem of the application of res judicata to taxation cases, examined it in detail and came to the conclusion that the said doctrine did not apply to tax cases in the sense that the decision for the levy of a tax for one year does not operate as res judicata in dealing with the question of a tax for the subsequent year.
On this occasion, emphasis was not placed so much on the limited nature of the jurisdiction of the Tribunal that deals with tax cases, but it was held that even if the matter goes to a High Court on a statement of the case, the decision of the High Court would also not create a bar of res judicata in dealing with the tax claim for a subsequent year. " 'The critical thing," said Lord Radcliffe, " 'is that the dispute which alone can be determined by any decision given in the course of these proceedings is limited to one subject only, the amount of the assessable income for the year in which the assessment is challenged.
" He, no doubt, recognised that in the process of arriving at the necessary decision, it was likely that the consideration of questions of law turning upon the construction of the ordinance or of other statutes or (1) (2) , (3) [1961] 2 W.L.R.794.
188 upon the general law, may be involved, but he thought that the decision of those questions should be treated as collateral or incidental to what is the only issue that is truly submitted to determination (pp. 800 801).
This decision would, therefore, support the appellants ' contention that the High Court was in error in dismissing their writ petitions on the preliminary ground that they were barred by res judicata.
In considering this question, it may be necessary to distinguish between decision on questions of law which directly and substantially arise in any dispute about the liability for a particular year, and questions of law which arise incidentally or in a collateral manner, as Lord Radcliffe himself has observed in the case of the Society of Medical Officers of Health, (1) that the effect of legal decisions establishing the law would be a different matter.
If, for instance, the validity of a taxing statute is impeached by an assessee who is called upon to pay a tax for a particular year and the matter is taken to the High Court or brought before this Court and it is held that the taxing statute is valid, it may not be easy to hold that the decision on this basic and material issue would not operate as res judicata against the assessee for a subsequent year.
That, however, is a matter on which it is unnecessary for us to pronounce a definite opinion in the present case.
In this connection, it would be relevant to add that even if a direct decision of this Court on a point of law does not operate as res judicata in a dispute for a subsequent year, such a decision would, under article 141, have a binding effect not only on the parties to it, but also on all courts in India as a precedent in which the law is declared by this Court.
The question about the applicability of res judicata to such a decision would thus be a matter of merely academic significance.
In the present appeals, the question which arises directly for our decision is : does the principle (1) , 563.
189 of constructive res judicata apply to petitions under article 32 or article 226 where the dispute raised is in respect of a year different from the year involved in a prior dispute decided by this Court ? We have already noticed the points actually decided by this Court against the appellants on the earlier occasion (vide The Amalgamated Coalfields Ltd.(1)).
One of the points sought to be raised was in regard to the validity of the increase in the rate of tax from 3 pies to 9 pies per ton; and since this point had not been taken in the petition and relevant material was not available on record, this Court refrained from expressing any opinion on it.
The appellants contend that the order passed by this Court refusing permission to the appellants to raise this point on the earlier occasion does not mean that this Court has decided the point on the merits against the appellants; it may mean that the appellants were given liberty to raise this point later: but even otherwise, the point has not been considered and should not be held to be barred by constructive res judicata .
It is significant that the attack against the validity of the notices in the present proceedings is based on grounds different and distinct from the grounds raised on the earlier occasion.
It is not as if the same ground which was urged on the earlier occasion is placed before the Court in another form.
The grounds now urged are entirely distinct, and so, the decision of the High Court can be upheld only if the principle of constructive res judicata can be said to apply to writ petitions filed under article 32 or article 226.
In our opinion, constructive res judicata which is a special and artificial form of res judicata enacted by section 11 of the Civil Procedure Code should not generally be applied to writ petitions filed under article 32 or article 226.
We would be reluctant to apply this principle to the present appeals all the more because we are dealing with cases where the impugned tax liability is for different years.
In dismissing the appellants ' petitions on the ground of res judicata, the High Court has no doubt referred to (1) ; 190 article 141 under which the law declared by this Court is binding on all Courts within the territory of India.
But when we are considering the question as to whether any law has been declared by this Court by implication, such implied declaration, though binding must be held to be subject to revision by this Court on a proper occasion where the point in question is directly and expressly raised by any party before this Court.
Therefore, we are inclined to hold that the appellants cannot be precluded from raising the new contentions on which their challenge against the validity of the notices is based.
The first.
ground urged by the appellants on the merits is that the levy authorised to be imposed by the Act and the Rules framed thereunder violates the fundamental rights guaranteed to the citizens under article 19 (1) (f) of the Constitution, and in support of this Arguments reliance is placed on the decision of this Court in Kunnathat Thathunni Moopil Nair vs The State of Kerala (1).
In that case, the impugned Act was struck down because it suffered from several serious infirmities; it was confiscatory in character and its provisions in regard to the levy of the impost were so arbitrary and unreasonable that the Court took the view that the Legislature had completely ignored the legal position that the assessment of a tax on person or property was at least of a quasi judicial character.
This conclusion was based on the examination of the relevant statutory provisions.
in the present case, we are not satisfied that this decision can assist the appellants at all, because the nature of the statutory provisions and the Rules framed under the Act in the present appeals is entirely different.
At this stage, it is necessary to refer to the relevant statutory provisions and the Rules.
Section 51 of the Act (which, in substance, corresponds to section 90 of the Act of 1948) reads thus (1) ; 191 "51.
(1) Subject to the provisions of any law or enactment for the time being in force, a District Council may, by a resolution passed by a majority of not less than two thirds of the members present at a special meeting convened for the purpose, impose any tax, toll or rate other than those specified in sections 24, 48, 49 and 50.
(2) The first imposition of any tax, toll or rate under sub section (1) shall be subject to the previous sanction of the Provincial Government.
x x x X" Sub section (3) and the proviso are not relevant for our purpose.
Then we go to section 79 which confers power on the Provincial Government to make Rules.
Section 79 (1)(xv) is relevant for our purpose.
It provides that : "The Provincial Government may make rules consistant with this Act and with reference, if necessary, to the varying circumstances of different local areas, as to the assessment and collection of the cases and rates specified in sections 48, 49 & 50 and of any tax, toll or rate imposed under section 51, as to the maximum amounts or rates at which any of them may be imposed, as to the prevention of evasion of assessment or payment thereof, as to the agency by which they shall be assessed and collected, and as to the manner in which account thereof shall be rendered by District Councils.
" In pursuance of the powers conferred on the local Government by section 79, rules have been framed on December 16, 1935.
Rules 3 to 10 deal with the question of the impost of tax and provide how decisions made in that behalf by appropriate authorities 192 become final.
Rule 3 prescribed the rate at 3 pies per ton, Rule 4 provides that the figures reported by the concessionaires and the Railway companies half yearly to the Dy.
Commissioner, shall be the basis for the assessment of the tax.
Under Rule 5, every mining lessee has to submit a statement half yearly.
On receipt of the statement, the assessment has to be made by the Chairman of the Independent Mining Local Board under Rule 6.
A notice of demand follows under rule 7.
Fifteen days ' period is given for filing objections under Rule 8.
Rule 9 provides for the Consideration and disposal of the objections, and Rule 10 lays down that if no objection is filed, the Chairman 's assessment shall be final, if any objection is received, the Independent Mining Local Board 's decision shall be final and shall be communicated to the assessee as soon as possible.
It would thus be seen that the scheme of these Rules provides ample opportunity to the assessees to object to the notice of demand served on them and in fact, the demand notices are substantially based on the figures supplied by the railway companies and the concessionaires and the statements submitted by the assessees themselves.
Therefore, it would be idle to suggest that the impost of the tax authorised by the relevant statutory provisions and the Rules is a capricious administrative or executive affair and so, should be held to violate article 19(1)(f) of the Constitution.
Then it is urged that the demand of the tax @ 9 'es per ton is invalid, because it is inconsistent with Rule 3 which has prescribed the maximum rate permissible to be levied against the assessees.
We have already noticed that section 79(1)(XV) authorised the making of a rule as to the maximum amounts or rates at which any of the articles can be taxed.
This was introduced by an amendment made in 1933 by C.P. Act VII of 1933, and so, the argument is that Rule 3 which provides that the tax shall be levied @ 3 pies per ton must be deemed to pro 193 vide for the maximum rate which can be levied and that is 3 pies per ton and no more.
This argument is no doubt well founded., because Rule 3 will have to be read in the light of the power conferred on the local Government by section 79(XV) and that would mean that the rate of 3 pies per ton has been prescribed by the Rule of the maximum rate permissible.
But this argument ignores the fact that this Rule has been subsequently deleted by a notification on September 6, 1943 published in the Government Gazette on September 10, 1943.
When this notification was cited before us, the appellants conceded that the argument based on the construction of Rule 3 was not available to them.
Therefore, the contention that Rule 3 prohibits the levy at a rate higher than 3 pies cannot succeed since the Rule itself has been subsequently deleted and was not a part of the Rules at the relevant time when the impugned notices were issued.
It is then argued that the impost of the tax at the rate of 9 pies per ton is not valid, because it does not comply with the requirements of section 51(2) of the Act, and that raises the question of the construction of the said section.
Section 51(1) authorises the imposition of the tax, provided, of course, the procedure prescribed by it and the requirements laid down by it are satisfied.
Sub Section (2) then lays down that the first imposition of any tax shall be subject to the previous sanction of the Provincial Government.
The appellants contend that in the context, the "first im position" means not only the first imposition in the sense of an initial imposition, but it includes every fresh imposition levied at an increased rate.
On the other hand, the respondent Sabha contends that the first imposition means only the initial levy or impost and cannot take in subsequent imposts or levies. 'In this connection, it is relevant to remember that sub section (2) was added by the same Amending Act by which section 79(XV) was amended, and 194 so, it would not be unreasonable to assume that when the legislature gave power to the local Government to prescribe by rules the maximum rates permissible to be levied, it introduced sub section (2) in section 51 because it was thought necessary that whenever the rates were changed, the imposition of the tax at the increased rates should receive the previous sanction of the Government.
If the respondent 's construction is accepted, it would mean that the respondent should obtain the previous sanction of the Government at the initial levy and thereafter may go on increasing the rate of the levy to any extent without securing the sanction of the Government in that behalf.
Now that Rule 3 has been deleted and no maximum has been or can be prescribed by the Rules, it would be unreasonable to hold that the respondent is given an unfettered and unguided authority to levy the impost in question at any rate it likes.
Since no ceiling has been placed by the Rules in that behalf, it would, we think be fair to hold that if the rates are increased and levy is sought to be imposed on the altered rates, the imposition of the levy at these altered rates should be deemed to be included in the express on "first imposition" under section 51(2).
We are, therefore, inclined to accept the appellants ' construction of section 51(2).
That being so, it is necessary to enquire whether the imposition of the tax @ 9 pies has received the previous sanction of the local Government.
During the course of his arguments, Mr. Sastri for the respondent attempted to suggest that sanction had been obtained for the increase in the rates from time to time and a typed summary of the notifications issued in that behalf was supplied to us at the time of arguments.
This summary refers to the three increments made in 1943, 1946 and 1947 respectively to which we have already referred.
The summary read as if the increments had been sanctioned by the State Government.
But Mr. Sachin Choudhury for the appellants contended that the 195 summary supplied by the respondent was incomplete and inaccurate and that the examination of the Gazette in which the notifications were published, would show that the amendments in the rates had been made not with the previous sanction of the Government, but by the Mining Local Board itself.
Two of these notifications were then produced before us by the respondent, and they supported the conten tion made by Mr. Choudhury.
Therefore, the argument that the imposition @ 9 pies per ton has received the sanction of the Government must fail, and so, the impugned notices which seek to recover the tax from the appellants @ 9 pies per ton must be held to be invalid The respondent is entitled to levy tax only @ 3 pies per ton because that levy has received the sanction of the Government, but if the respondent intends to increase the rate of the said tax, it must follow the procedure prescribed by s.51(2), provided of course, it is open to the respondent to increase the said tax.
There is yet another point on which the appellants are entitled to succeed, and that has reference to the fact that the respondent is seeking to reopen some of the assessments made by it against the appellants.
The argument is that once an assessment is made for a specific period, it becomes final and it is not open to the respondent to demand additional amount by way of tax in respect of the said period.
The genesis of the tax is somewhat interesting.
It appears that roads were constructed by the Independent Mining Local Board at enormous cost at the request of the Mining interests and even debt had to be incurred by the Board for completing the work of the construction of roads.
Since the mining companies received substantial benefit from these roads, the Legislature thought of levying a tax on coal, and that is the origin of the tax.
When the first notification was issued on December 16, 1935 it authorised and sanctioned the imposition by the Independent 196 Mining Local Board at Chhindwara in the Chhindwara District "of a tax at 3 pies per ton on coal, coal dust or coke, manufactured at the mines, sold for export by rail or sold otherwise than for export by rail, within the jurisdiction of the Independent Mining Local Board.
" This tax was recovered by the Board and thereafter by the respondent in respect of coal whether sold inside the district of Chhindwara or sold outside the district of Chhindwara or even outside the State of Madhya Pradesh.
In other words, the total coal produced by each mining lease holder substantially came to be taxed.
But after the Constitution came into force, doubts arose as to whether article 286 of the Constitution did not preclude the respondent from recovering tax in respect of coal exported out of the State of Madhya Pradesh, and in view of the advice given to the respondent by the Government of Madhya Pradesh, the respondent did not collect the tax in respect of coal which was exported by rail outside the State of Madhya Pradesh from about 1952.
The respondent wanted to consult legal opinion on this point, but the State Government refused permission to the respondent to incur expenditure in that behalf.
Subsequently however, this question came to be decided by the High Court of Madhya Pradesh in a writ petition filed by M/s. Newton Chickli Collieries (Pvt.
) Ltd. (No. 265 of 1957).
The High Court held that the tax levied by the janapada Sabhas under s.51 of the Act did not amount to a sales tax nor to an excise duty and so, the respondent thought that it could levy tax even on coal exported by rail outside the State of Madhya Pradesh.
In fact after this judgment was pronounced by the High Court on August 6, 1958, the Provincial Government withdrew its instructions to the respondent not to levy tax on exported coal.
That is how the respondent has issued notices against the appellants in respect of coal exported by rail out of the State of Madhya Pradesh in regard to the years for which assessment has already been levied against the 197 appellants for the coal not so exported, and the contention of the appellants is that this reopening of the assessment is not permissible under the Rules.
This contention appears to be well founded.
We have already seen the scheme of the Rules and we have noticed that Rule 10 provides that if no objection is filed, the Chairman 's assessment shall be final and if an objection is received, the decision of the Mining Board would be final.
In other words, the scheme clearly provides that at the end of each six monthly period, the tax has to be assessed, notices to be issued to the assessee, his objections to be considered and the tax to be ultimately determined in the light of the decision on the said objections; and under Rule 10, the two decisions specified therein become final.
It may be that the Rules do not prescribe any limitation within which these steps have to be taken by the respondent for each period, but that is another matter.
In view of the provisions of Rule 10, it is difficult to hold that the respondent is entitled to reopen assessments already made and rendered final under the said Rule.
There is no other provision for reopening assessment as we have under sections 34 & 35 of the Indian Income Tax Act, and so,.
the respondent is not justified in issuing notices for the years which arc covered by assessment orders already passed.
The finality provided for by Rule 10 will work as much against the respondent as against the assessees.
In support of the appeals, another argument was sought to be raised against the increase of the rates.
It was urged that the tax is in the nature of an excise duty or a sales tax and, therefore, any increase in the said tax beyond the limit of 3 pies the continuance of which has been saved by the provisions of article 143 of the Government of India Act, 1935 and article 277 of the Constitution will be invalid.
This argument is based on the terms used 198 in the notification of December 16, 1935.
Since coal is described as manufactured at the mines, the argument is that it is in the nature of an excise duty and since the notification also refers to coal sold for export by rail or sold otherwise than for export by rail, it is ' argued that it is a sales tax.
On the other hand, the respondent contends that it is neither a sales tax nor an excise duty and as such, the rate can be increased subject, of course, to the requirements of section 51 (2) of the Act.
It appears that by notification issued on September 6, 1943, the preamble of the Rules was modified by substituting for the words " 'coal, coal dust or coke" by "coal and dust coal" and by deleting the words " 'manufactured at the mines".
Curiously enough, these amendments have not been made in the original notification itself.
We have already noticed that this latter notification deleted Rule 3.
Some arguments were urged before us by learned counsel on both sides as to the effect of this notification which modified the preamble to the Rules.
We do not, however, think it necessary to consider these arguments in the present appeals because of our conclusion that the impugned notices levying the tax @ 9 pies per ton are invalid for two reasons: the increase in the rates has not been sanctioned by the State Government under section 51 (2) and an attempt to recover at the increased rate the tax for the years already covered by assessment orders passed in that behalf, is barred by Rule 10.
The result is, the appeals and the writ petitions are allowed and an appropriate direction or order is issued restraining the respondent from recovering the tax at a rate higher than 3 pies per ton and also restraining the respondent from recovering any additional tax in respect of the years for which tax has already been assessed against the appellants.
The same will be the order in the other companion appeals.
The 199 appellants will be entitled to their costs, but one set of bearing fees will be taxed.
Appeals and writ petitions allowed.
[/INST]The Government of Jammu and Kashmir on the basis of the report of the commission of enquiry set up by it demoted the respondent who had been suspended earlier.
The respondent moved the Jammu and Kashmir High Court under article 32(2A) of the Constitution of India as applied to the State of Jammu and Kashmir for a writ, inter alia, questioning the validity of the order suspending and demoting him, alleging violation of rules of natural justice by the commission of enquiry and breach of statutes and rules of service.
Articles 226 and 311(2) of the Constitution of India bad not been applied to the State of Jammu 970 and Kashmir.
The High Court acting under article 32(2A) set aside the orders suspending and demoting the respondent.
Held, that the High Court had no powers to act under article 32(2A) of the Constitution of India as the writ petition did not disclose a violation of any fundamental right.
Held, further, that the breach of a law by the ' Government, if any, did not amount to a denial of the equal protection of the laws, as it had not ever been alleged by the respondent that the benefit of that law had been designedly denied only to him.
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<s>[INST] Summarize the judgementivil Appeal Nos.
667 668 of 1975.
From the Judgment and order dated the 10 5 1973 of the Delhi High Court in Letter Patent Appeal Nos. 65 and 103 of 1969.
F. section Nariman.
Randhir Chawla.
G. C. Sharma.
Mrs. A; K. Verma, Talat Ansari.
Ravinder Narain, and O. C. Mathur for the Appellant.
G. L. Sanghi, R. N. Sachthey and Girish Chandra for the Respondents.
The Judgment of the Court was delivered by UNTWALIA, J.
In these appeals by certificate the question for determination is whether the exercise of the power of revision under sub section (3) of section 20 of the Bengal Finance (Sales Tax) Act, 1941 as extended to the Union Territory of Delhi hereinafter called the Act is subject to the period of limitation provided in sub section (2a) of section 11 or section 11A of the said Act.
The requisite 3 facts lie in a narrow compass and may usefully be stated at the outset.
The appellant who was carrying on the business of execution of building contracts was assessed to sales tax under the Act by the Sales Tax officer for the year 1955 56 by an order of assessment made on November 23, 1959.
The appellants appeal before the Assistant Commissioner of Sales Tax succeeded in part.
He held that the assessment for the first two quarters of the year 1955 56 was invalid having been made out of time.
The case was, therefore, remanded to the Sales Tax officer for a fresh assessment in respect of the 3rd and 4th 249 quarters of the year.
The Sales Tax officer in pursuance of the A appellate order of remand dated February 11, 1960 passed a fresh .
assessment order on March 21, 1960.
The Commissioner, however, after notice dated July 21, 1960 to the appellant, by his order dated July 29, 1960 revised the appellate order of the Assistant Commissioner in exercise of his power under section 20(3) of the Act.
He held that no part of the assessment for the year 1955 56 was barred and directed a fresh assessment to be made.
A fresh assessment for all the four quarters was accordingly made by the Sales Tax officer on September 24, 1960.
The appellant filed two writ petitions in the Delhi High Court challenging the order made in revision by the Commissioner and the fresh assessment order passed by the Sales Tax officer in pursuance thereof.
A learned single Judge of the High Court allowed the writ applications on April 2, 1969 and quashed the impugned orders.
The respondents took up the matter in letters patent appeal and succeeded before a Bench of the High Court.
Hence these appeals by the assessees Mr. F. section Nariman appearing for the appellant contended: (1) That the appellate and the revisional authorities must exercise their appellate or revisional power within the period prescribed under sub section (2a) of section 11 of the Act.
If their orders are final orders of assessment then directly they are exercising their powers under sub sections (1) or (2) of section 11.
In case their orders are of remand for fresh assessment to the assessing` authority then also they must pass their orders within the periods aforesaid although under the proviso added in 1959 the assessing authority may have a further period of 4 years or 6 years, as the case may be, for passing a fresh assessment.
(2) That the Commissioner while exercising the power in revision cannot overstep and ignore the period of limitation of 3 years provided in section 11A of the Art (3) That the authority mentioned in sections 11, 11A and 20(3) being the Commissioner, the Commissioner is subject to the period of limitation provided in sections 11 and 11A even when exercising the revisional power under section 20(3).
(4) That in any view of the matter the revisional authority must exercise the Dower in a reasonable manner and within a reasonable time.
It cannot exercise the power of revision, suo moto, after a long lapse of time at its sweet will and pleasure.
Under section 3 of the Act, a hierarchy of officers has been constituted by the Chief Commissioner namely, the Commissioner of Sales Tax, Sales Tax officers and others to assist him.
Section 11 of the Act deals with assessment of tax.
The Sales Tax officer 250 exercising the powers as an officer to assist the Commissioner under section 11(1) of the Act can proceed to assess the amount of the tax due from a registered dealer within 18 months of the expiry of a particular period.
A dealer who has been liable to pay tax under the Act but has failed to get himself registered can be assessed to tax under sub section (2).
Then sub section 2(a) says: "No assessment under sub section (1) shall be made after the expiry of four years and no assessment under subsection (2) shall be made after the expiry of six years from the end of the year in respect of which or part of which the assessment is made :" A proviso was added to sub section (2a) w.e.f. October 1, 1959 By the Amending Act of 1958 and it reads as follows: "Provided that where such assessment is made in consequence of or to give effect to any order of an appellate or revisional authority or of a court, the period of four years or six years, as the case may be, shall be reckoned from the date of such order.
" lt is to be noticed that a period of limitation has been provided in section 11(2a) and no assessment either under sub section (1) or sub section (2) can be made after the expiry of the specified period.
But where such an assessment is made by the assessing authority in consequence of or to give effect to any order of an appellate or revisional authority or any order of a court made in reference, writ or in any other proceeding then under the proviso the period of limitation is to be reckoned from the date of such order.
The Legislature has not provided any period.
within which an order is to be made by an appellate or revisional authority of a court.
Obviously it would have been unpractical and unworkable to do so.
Section 20 deals with an appeal, revision or review.
If the appeal is filed in time the appellate authority in disposing of any appeal filed Under sub section (1) may (a) confirm, reduce, enhance or annul the assessment, or; (b) set aside the assessment and direct the assessing r authority to make a fresh assessment after such further inquiry as may be directed.
" For exercise of the appellate power in any of the manners mentioned above, there is no limitation of time.
If assessment can be reduced in appeal at any time it can be enhanced also without the fetter of time.
If the assessment is set aside and the case remanded to the assessing authority to make a fresh assessment then the authority, because of the proviso to section 11(2a), is obliged to make the fresh assessment within four years of the appellate order.
Sub section (3) of section 20 reads thus: "Subject to such rules as may be prescribed and for reasons to be recorded in writing, the Commissioner upon 251 application or of his own motion may revise any assessment A made or order passed under this Act or the rules there under by a person appointed under section 3 to assist him, and subject as aforesaid, the Chief Commissioner may, in like manner, revise any order passed by the Commissioner.
" The Commissioner can revise any assessment made or order passed under the Act including the order of the appellate authority.
The limits of the revisional power are not circumscribed in sub section (3), ut it goes without saying that they will be akin to the power of the appellate authority as mentioned in sub section (2).
The revisional authority obviously, as pointed out by this Court in the case of The State of Kerala vs K. M. Cheria Abdulla and Company(1) should not trench upon the power expressly reserved by the Act or the rules to other authorities and cannot ignore the limits inherent in exercise of those powers.
Section 11A is one such power which deals with assessment and re assessment of tax in case of an escaped assessment or under assessment.
Exercise of that power is subject to the limitations provided therein.
In Rule 66(2) of the Delhi Sales Tax Rules, 1951 a period of limitation of 60 days has been provided for the filing of an application in revision which can be extended under the proviso appended to that rule on sufficient cause being shown.
But no such limitation has been provided for the suo moto, exercise of the revisional power.
Mr. Nariman very strongly relied upon the majority decision of this Court in The State of Orissa vs Debaki Debi and others (2) and Submitted that the power of revision exercised by the Commissioners ill this case beyond the period of four years prescribed in sub section (2a) of section 11 was illegal and ultra vires.
A close scrutiny of the argument will result in its rejection.
In the Orissa case all the orders made by the Collector in exercise of his power of revision under section 23 of the Orissa Sales Tax Act were passed later than 36 months from the expiry of the period in respect of which the assessment was made.
The High Court 's view that they were in contravention of section 12(7) which was a power of assessment or re assessment in case of an escaped or under assessment was not upheld.
But it was found that the proviso to section 12(6) was in general terms.
It was not only a proviso providing for the period of limitation for the first assessment but it governed the assessment made in exercise of the appellate or the revisional power.
The main ratio decidendi of the case is that the proviso in section 12(6) is in reality an independent legislative provision unrelated to section 12(6).
Therefore, its operation was not confined to assessment under section 12 but applied to any assessment made under the Act.
In the alternative it was also opined that assessment made in exercise of the revisional power was an assessment made under section 12.
It was so said because if the appellate or the revisional authority would have directed the assessing authority to make a fresh assessment it could do so only under section 12 and then it (1) 16 Sales Tax Cases, 875.
(2) 15 Sales Tax Cases, 153.
252 would be subject to the period for limitation of 36 months.
It was pointed out in the majority decision of this Court that there would be an anomalous situation.
If the appellate authority set aside the assessment and remanded it for fresh orders, no fresh assessment could be made because of the period of limitation.
But if instead of doing so the appellate authority affected the same assessment there would be no bar of limitation.
In the present case in view of the proviso added to section 11(2a) the anomaly flows in the reverse direction.
If the appellate or the revisional authority made a remand order the assessing authority could pass a fresh order of assessment within 4 years of such order.
But if the higher authority itself revised the assessment then it would be barred by the rule of limitation provided in section 11 (2a) .
To avoid such an anomaly Mr. Nariman suggested a construction to be put which neither solves the anomaly nor is warranted by the language of the provisions of the Act.
Counsel submitted that in all cases the powers must be.
exercised within 4 years of the period in respect of which an assessment was being made on a registered dealer.
It will be wholly unreasonable almost impossible to say that all orders in appeal, revision or reference must be passed within four years of the end of the period of assessment, otherwise they will be barred.
It does not solve the anomaly either.
Even if the order of remand is made, say, just on the last day of the period of four years, it will be competent to the assessing authority to make a fresh assessment within the further period of four years.
The ratio of the case in Debaki Debi 's (supra) must be confined within its four corners and cannot be extended to the facts of the instant case.
In The Swastik oil Mills Ltd. vs H. B. Munshi, Deputy Commissioner Of Sales Tax Bombay (1) the decision of this Court in Debaki Debi 's case was distinguished on the ground that the provision of limitation of 36 months in substance was not a real proviso to the section in which it was placed but was in fact a period of limitation for all orders of assessment made under any other provision of the Orissa Act, while in the Bombay Acts there was no such general provision prescribing a period of limitation for making an assessment.
Reference to the period of limitation in section 11A of the Bombay Act which is a power of making assessment or re assessment in case of an escaped or under assessed assessments was also rejected.
our attention was also drawn to the decision of a single Judge of the Punjab High Court, Delhi Bench, in Sir Sobha Singh & Company vs Commissioner of Sales Tax, Delhi (2) wherein following the decision of this Court in Debaki Debi 's case it was held that an order of review made by the Commissioner under section 20(4) of the Act in effect is an order of assessment under section 11(1) and cannot be made r o after the expiry of the period prescribed under section 11(2a).
The learned Judge in the course of his judgment made it clear that he was concerned with the construction of the Act as it stood before 1959 and was not obliged to consider the effect of the proviso added to section 11(2a) in 1959.
It is not necessary to decide in this case whether without the aid of the proviso aforesaid the decision of the (1) 21 Sales Tax Cases, 383.
(2) 18 section T. C. 416.
253 learned single Judge was correct or not but surely in face of the proviso it cannot hold good.
In Commissioner of Commercial Taxes, Bihar, Patna vs Sheodutta Prasad Chandeshwar Singh (1) the review proceedings initiated by the assessing authority was held to be barred under the proviso to section 13(6) of the Bihar Sales Tax Act, 1947.
But distinguishing the said decision another Bench of the Patna High Court held in Commissioner of Commercial Taxes, Bihar vs Ashoka Marketing Ltd: (2) that the order of review passed by the Deputy Commissioner was not bared by time.
The decision of the Patna High Court in Commissioner of Commercial Taxes, Bihar, Patna vs Sheodutta Prasad Chandeshwar Singh (supra) on identical facts was followed in Commissioner of Commercial Taxes, Bihar vs Shiva Pujan Prasad Bhagat (3).
But the principle decided in those cases cannot help the appellant.
It may well be that if the assessing authority itself exercises the power of review it cannot circumscribe the bar of limitation provided in section 11 (2a) .
But it will be unjust, unreasonable and impracticable to say that the said bar of limitation must also continue to run at all stages of the proceedings, namely, the appellate, revisional, reference, writ or any other stage.
It was pointed out by this Court in Swastik oil Mills ' case (supra) that the Deputy Commissioner when seeking to exercise his revisional powers was not encroaching upon the powers reserved to other authorities.
The powers were not exercised for the purpose of assessing or re assessing an escaped turn over.
The revisional powers were sought to be exercised to correct what appeared to be an incorrect order passed by an Assistant Commissioner and for such a purpose proceedings could not possibly have been taken under section 11A.
In the instant case also it could not be disputed that the view taken by the Assistant Commissioner in appeal was obviously wrong.
The Commissioner while correcting that mistake in exercise of his revisional power was not doing anything which the Sales Tax officer was empowered to do under section 11A.
He was merely setting right the illegality in the appellate order.
The third point urged by the appellant is too obviously wrong to merit any detailed discussion.
It was not the Commissioner who had passed the assessment order under section 11.
That order was of the Sales Tax officer acting as an officer to assist the Commissioner for the purpose of assessment.
The assessment order was interfered with by the appellate authority, the Assistant Commissioner and the Commissioner was revising the order of the Assistant Commissioner.
All cannot be treated as Commissioners for the purpose of the different powers exercised by the three different authorities.
The use of the term "Commissioner" in the sections is merely for the purpose of describing and, at any rate, including the officer assisting the Commissioner as Commissioner.
(1) 25 S.T.C. 114.
(2) 33 S.T.C. 24, (3) ,33 S.T.C. 466.
254 Apropos the fourth and the last submission of the appellant, suffice it to say that even assuming that the revisional power cannot be exercised suo moto after an unduly long delay, on the facts of this case it is plain that it was not so done.
Within a few months of the passing of the appellate order by the Assistant Commissioner, the Commissioner proceeded to revise and revised the said order.
There was no undue or unreasonable delay made by the Commissioner.
It may be stated here that an appeal has to be filed by an assessee within the prescribed time and so also a time limit has been prescribed for the assessee to move in revision.
The appellate or the revisional powers in an appeal or revision filed by an assessee can be exercised in due course.
No time limit has been prescribed for it.
It may well be that for an exercise of the suo moto power of revision also, the revisional authority has to initiate the proceeding within a reasonable time.
Any unreasonable delay in exercise may affect its validity.
What is a reasonable time, however, will depend upon the facts of each case.
For the reasons stated above the appeals fail and are dismissed with costs.
One set of hearing fee.
P.B.R. Appeals dismissed.
[/INST]Even when a bonus dispute was pending adjudication before the Industrial Tribunal, the workmen of the appellant resorted to rude tactics to press their earlier charter of demands, which took the turn of an illegal and disorderly strike.
The management declared a lockout.
On the day following the declaration of lockout, the workmen requested the management to lift the lockout proferring peaceful resumption of work and asking for an interim relief on their economic demands.
The management did not agree to lift the lockout.
Eventually however, The lockout was lifted and the strike called off.
On the question of wages during the strike period, the Industrial Tribunal, apportioning fault to both the parties directed that the management should pay half the wages to the employees during the strike period.
Dismissing the appeal, ^ HELD: (1) There is much to be said in favour of the view of the Tribunal that the blameworthiness may be equally apportioned between the parties.
Where the strike is illegal and sequel of a lockout legal, the Court has to view the whole course of developments and not stop with examining the initial legitimacy.
If one side or other behaves unreasonably or the overall interests of good industrial relations warrant the Tribunal making such directions regarding strike period wage as will meet with justice, fairplay and pragmatic wisdom, there is no error in doing so.
The power of the Tribunal is flexible.
D E] India Marine Service, , followed.
In the instant case there was a pending industrial dispute when the Unions sprang a strike notice.
The strike being illegal, the lockout that followed, be came a legal, defensive measure.
But the management could not behave unreasonably merely because the lockout was born lawfully.
by subsequent conduct, the Unions had shown readiness to resume work peacefully, the refusal to restart the industry was not right and the initial legitimacy of the lockout lost its virtue by this blemished sequel.
[232 G Hl (2) In an appeal under Article 136 of the Constitution, this Court would interfere with the Award under challenge only if extraordinary flaws or grave injustice our other recognised grounds are made out.
[231 E F] Bengal Chemical.
[1959] Suppl.
2 SCR 136, 141; and Associated Cement Companies Ltd. AIR 1972 SC 1552.
1554, followed.
In the instant case the direction of the Tribunal that the Company should pay tiffin allowance at the rate of 50 paise on working days to the employees in the staff canteen and that the members of the subordinate staff should be sup plied with warm coats did not call for interference.
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<s>[INST] Summarize the judgementAppeal No. 86 of 1959.
Appeal by special leave from the judgment and order dated March 27, 1957, of the Patna High Court in Appeal from Original Decree No. 359 of 1948.
A. V. Viswanatha Sastri and section P. Varma, for the appellant.
882 H. N. Sanyal, Additional Solicitor General of India, R. Ganapathy Iyer and T. M. Sen, for the respondent.
July, 24.
The Judgment of the Court was delivered by SHAH, J.
Bikhraj Jaipuria hereinafter called the appellant is the sole proprietor of a grocery business conducted in the name and style of "Rajaram Vijai Kumar" in the town of Arrah in the State of Bihar.
In the months of July and August, 1943, the, Divisional Superintendent, East Indian Railway under three " 'purchase orders ' agreed to buy and the appellant agreed to sell certain quantities of food grains for the employees of the East Indian Railway.
The 'following table sets out the purchase prices, the commodities, the dates of purchase orders, the quantities and the rates and the method of supply.
Purchase Date of Kinds Quantity Rates.
Order purchase of of No. orders.
commo commo dity.
dities.
(1) (2) (3) (4) (5) 69.
20 7 1943.
Gram 1st 1000 mds. @ Rs. 15/ quality.
per md.
(plus cost of new bags not exceeding Rs. 75/ per 100 bags) F.O.R. any E.I.Rly.
sta tion in Bihar.
:4 7 1943.
Rice 1000 mds.
@ Rs. 22 8 0 Dhenki (plus cost of Medium bags not ex quality.
ceeding Rs.75 883 (1) (2) (3) (4) (5) per cent) per md.
F.O.R. any station on the division.
Wheat 5000 mds.
@ Rs. 20 8 0 white per md.
with as per bags F.O.R. sample.
any station on E.I.R. on the Division.
24 8 1943.
Rice 15000 mds. @ Rs. 24/ medium per md.
with quality.
out bags F.O.R. E.I. Rly.
station in Bihar.
Purchase orders Nos. 69 and 76 were signed by S.C. Ribbins, Personal Assistant to the Division at Superintendent and purchase order No. 106 was signed by the Divisional Superintendent.
Under the purchase orders delivery of grains was to commence within seven days ' of acceptance and was to ' be completed within one month.
The appellant delivered diverse quantities of foodgrains from time to time but was unable fully to perform the contracts within, the period stipulated.
Between July.), 20, 1943 and August of 4, 1943, he supplied 3465 maunds of rice and between September 1, 1943 and September 19, 1943 he supplied 1152 maunds 35 seers of wheat.
In exercise of the powers conferred by cl.(b) of Sub r.
(2) of r.81 of the Defence of India Rules, the Government of Bihar by notification No. 12691 P.C. dated September 16, 1943 directed that commodities named in column I of the schedule shall not, from and including September 20, 1943 and until further notice, be sold at any primary source of supply or by the proprietor, manager or employee of any mill in the Province of Bihar at prices exceeding those 884 specified in the second column of the schedule.
The controlled rat . of rice (medium) was Rs. 18/ per standard maund, of wheat (red) Rs. 17/ , of wheat (white) Rs. 18/ and of gram Rs. 12 8 0.
The Sub Divisional Magistrate, District Arrah issued on September 21, 1943, a price list of controlled articles fixing the same prices as were fixed for wheat, rice and gram by the notification issued by the Government of Bihar.
By cl.
(2) of the notification, a warning was issued that in the event of the dealers selling controlled articles at rates exceeding those fixed or with holding stocks of such articles from sale, "they will be liable to prosecution under r.81 (1) of the Defence of India Rules.
" By a telegraphic communication dated Sep. tember 28, 1943, the Divisional Superintendent informed the appellant that under the purchase orders, foodgrains tendered for delivery will not, unless despatched before October 1, 1943, be accepted, and barring a consignment of 637 maunds 20 seers accepted on October 7, 1943, the Railway Administration declined to accept,delivery of food grains offered to be supplied by the appellant after October 1, 1943.
The appellant served a notice upon the Divisional Superintendent coraplaining of breach of contract and sold between February la and February 23, 1944 the balance of foodgrains under the purchase orders which were lying either at the various railway stations or in his own godowns.
The appellant then called upon the Railway Administration to pay the difference between the price realised by sale and the contract price and failing to obtain satisfaction, commenced an action (Suit No. 359/48A) in the court of the First Additional Subordinate Judge, Patna for a decree for Rs. 2,89,995 15 3 against the Dominion of India.
The appellant claimed Rs. 2,32,665 12 0 being the difference between the contract price and the price realised, Rs.42,709 10 3 as interest and Rs. 14,620 9 0 as freight, wharf.
885 age, cartage, price of packing material, labour charges and costs incurred in holding the sale.
The appellant submitted that under the terms of the purchase orders, supply was to commence within seven days of the date of receipt of the orders and was to be completed within one month, but it was not intended that time should be of the essence of the contract, and in the alternative that the Railway Administration had waived the stipulation as to time in the performance of the contracts and therefore he was entitled, the Railway Administration having committed breach of ,the contracts, to recover as compensation the difference between the contract price and the price for which the grains were sold.
The suit was resisted by the Dominion of India contending inter alia that the appellant had no cause of action for the claim in the suit, that the contracts between the appellant and the Divisional Superintendent Dinapur were not valid and binding upon the Government of India and that the contracts were liable to be avoided by the Government, that time was of the essence of the contracts, that stipulations as to time were not waived, and that no breach of contract was committed by the East Indian Railway Administration and in any event, the appellant had not suffered any loss as a result of such breach.
By the written statement, it wag admitted that the East Indian Railway through the Divisional Superintendent, Dinapur had by three orders set out in the plaint agreed to buy and the appellant had agreed to sell the commodities specified therein, but it was denied that the Divisional Superintendent had been ""given complete authority to enter into contracts for the supply of foodgrains.
" The trial court held that time was not of the essence of the contracts and even if it was, breach of the stipulation in that behalf was waived.
It further_held that the plea that the contracts were void because they were not in accordance with the 886 provisions of section 175 (3) of the Government of India Act, 1935, could not be.permitted to be urged, no such plea having been raised by the written statement.
Holding that the Divisional Superintendent was authorised to enter into the contracts for purchase of foodgrains, and that he had committed breach of contracts the trial Judge awarded to the appellant Rs. 1,29,460 7 0 with interest thereon at the rate of 6% per annum from October 1, 1943, to the date of the institution of the suit and further interest at 6% on judgment.
Against that decree, an appeal was preferred by the Union of India to the High Court of Judicature at Patna and the appellant filed cross objections to the decree appealed from.
The High Court held that time was of the essence of the contracts, but the Railway Administration having a accepted the goods tendered after the expiration of the period prescribed thereby, the stipulation as to time was waived.
The High Court further held that by the notification under r. 81 of the Defence of India Rules, performance of the contracts had not been rendered illegal but the Divisional Superintendent had no authority to enter into contracts to purchase food grains on behalf of the Railway Administration and that in any event, the contracts not having been expressed to be made by the Governor General and not having been executed on behalf of the Governor General by an officer daily appointed in that behalf and in manner prescribed, the contracts were unenforceable.
The High Court also held that the appellant was not entitled to a decree for compensation because he had failed to prove the ruling market rate on the date of breach viz, October 1, 1943.
The High Court also observed that the trial court erred in awarding interest prior to the date of the suit and in so holding, relied upon the judgment of the Privy Council in Bengal Nagpur Railway Co., Ltd. vs Ruttanji Ramji and others (1).
(1) L. R. (1938) 65 J. A. 66. 887 In this appeal by the appellant, two questions fall to be determined, (1) whether relying upon the purchase orders signed by the Divisional Superintendent which were not made and executed in the manner prescribed by s.175 (3) of the, Government of India Act 1935, the appellant could sue the Dominion of India for compensation for breach of contract, and (2) whether the appellant has proved the ruling market rate on October 1, 1943 for the commodities in question.
, The finding that the Railway Administration had waived the stipulation as to the performance of the contracts within the time prescribed though time was under the agreement of the essence, is not challenged before us on behalf of the Union of India.
If the finding as to waiver is correct, manifestly by his telegraphic intimation dated September 28, 1943, that the foodgrains not despatched before October 1, 1943, will not be accepted the Divisional Superintendent committed a breach of the contract.
Section 175 (3) of the Government of India Act as in force at the material time provided : "Subject to the provisions of this Act, with respect to the Federal Railway Authority, all contracts made in the exercise of the executive authority of the Federation or of a Province shall be expressed to be made by the Governor General, or by the Governor of the Province, as the case may be, and all such contracts and all assurances of property made in the exercise of that authority shall be executed on behalf of the Governor General or Governor by such persons and in such manner as he may direct or authorise.
" The Federal Railway Authority had not come.
into being in the year 1943: it was in fact never set up.
The contracts for the supply of foodgrains were undoubtedly_ made in the exercise of executive 888 authority of the Federation.
The contracts had therefore under section 175(3), (a) to be expressed to be made by the Governor General, (b) to be executed on behalf of the Governor General, and (e) to be execrated by officers duly appointed in that behalf and in such manner as the Governor General may direct or authorise.
But no formal contracts were executed for the supply of foodgrains by the appellant : he had merely offered to supply foodgrains by letters addressed to the Divisional Superintendent and that officer had by what are called "purchase orders" accepted those offers.
These purchase orders were not expressed to be made in the name of the Governor General and were not executed on behalf of the Governor General.
The purchase orders were signed by the Divisional Superintendent either in his own hand or in the hand of his Personal Assistant.
In the first instance it has to be considered whether the Divisional Superintendent had authority to contract on behalf of the Railway Administration for buying foodgrains required by the Railway Administration.
By Ex.
M 2 which was in operation at the material time, all instruments relating to purchase or hire, supply and conveyance of materials, stores, machinery, plant, telephone lines and connections, coal etc. could be executed amongst others by the Divisional Superintendent; but contracts relating to purchase of foodgrains are not covered by that authority.
Under item 34 which is the residuary item, all deeds and instruments relating to railway matters other than those specified in items 1 to 33 may be executed by the Secretary of the Railway Board.
It is common ground that there is no other item which specifically authorises the making and execution of contracts relating to purchase of foodgrains; deeds and instruments relating to purchase of food grains therefore fall within item 34.
The Secretary to the Railway Board had not executed these purchase orders : but the trial Court held 889 that the Divisional Superintendent was authorised to enter into contracts with the appellant for the supply of foodgrains.
In so holding, the trial judge relied upon the evidence of Ribbins, Grain Supply Officer and Personal Assistant to the Divisional Superintendent, Dinapur.
The High Court disagreed with that view.
The High Court observed that the authority of the officer acting on behalf of the Governor General "must be deduced from the express words of the Governor General himself expressed by rules framed or by notification issued, under section 175(3).
No notification has been produced in this case showing that the Divisional Superintendent had been authorised by the Governor General to execute such contracts on his behalf, nor has any rule been produced which conferred authority upon the Divisional Superintendent to make such contracts.
" After referring to paragraph 10 of the notification, exhibit M 2 items 1 to 34, the High Court observed: "Therefore this notification rather shows that the Divisional Superintendent had no authority to execute the contracts for the purchase of food grains." In our view, the High Court was in error in holding that the authority under section 175(3) of the Government of India Act, 1935 to execute the contract could only be granted by the Governor General by rules expressly promulgated in that behalf or by formal notifications.
This court has recently held that special authority may validly be given in respect of a particular contract or contracts by the Governor to an officer other than the officer notified under the rules made under section 175(3).
In The State of Bihar vs M/s. Karam Chand Thapar and Brothers Ltd.(,), Venkatarama Aiyar J. speaking for the court observed : (1) ; 890 It was further argued for the appellant that there being a Government notification of a formal character we should not travel outside it and find authority in a person who is not authorised thereunder.
But section 175 (3) does not prescribe any particular mode id which authority must be conferred.
Normally, no doubt, such conferment will be by notification in the Official Gazette, but there is nothing in the section itself to preclude authorisation being conferred ad hoc on any person, and when that is established, the requirements of the section must be held to be satisfied." In that case, an agreement to refer to arbitration on behalf of the Government of Bihar was executed by the Executive Engineer whereas by the notification issued by the Government of Bihar under s.175 (3) all instruments in that behalf had to be executed by the Secretary or the Joint Secretary to the Government.
This Court on a consideration of the correspondence produced in the case agreed with the High Court that the Executive Engineer had been specially authorised by the Governor acting through his Secretary to execute the agreement for reference to arbitration.
Section 175 (3) in terms does not provide that the direction or authority given by the Governor General or the Governor to a person to execute contracts shall be given only by rules or by notifications, and the High Court was in our judgment in error in assuming that such authority can be given only by rules expressly framed or by formal notifications issued in that behalf.
In para 5 of the plaint, the appellant pleaded: " 'That for the purposes and under the authority conferred as noted in the para 3 above in July and August, 1943 the said E. 1.
through its then Divisional Superintendent, Dinapur, by three diverse orders agreed to buy and the plaintiff agreed to sell the following commodities at the rates mentioned against them, 891 By para 3 of the written statement, the Dominion of India accepted the allegations made in para 5 of the plaint.
It is true that by paragraph 1, the authority of the Divisional Superintendent to enter into contract with, trading firms dealing in foodgrains for the supply of foodgrains was denied and it was further denied that the Divisional Superintendent "was invested with complete authority to enter into contracts for the purchase of food supplies and to do all that was necessary in that connection.
" There was some inconsistency between the averments made in paragraphs 1 and 3 of the written statement, but there is no dispute that the purchase orders were issued by the Divisional Superintendent for and on behalf of the East Indian Railway Administration.
Pursuant to these purchase orders, a large quantity of foodgrains was tendered by the appellant: these were accepted by the Railway Administration and, payments were made to the appellant for the grains supplied.
Employees of the Railway Administration wrote letters to the appellant calling upon him to intimate the names of the railway stations where grains will be delivered and about the date when the supply.
will commence.
They fixed programmes for inspection of the goods, kept 'wagons ready for accepting delivery, held meetings on diverse occasions for settling programmes for the supply of grains, rejected grains which were not according to the contract, entered into correspondence with the appellant about the return of empty bags accepted bills and railway receipts and made pay ments, returned certain bills in respect of the grains tendered beyond the period of contract and did diverse other acts in respect of the goods which could only be consistent with the contracts having been made with the authority of the Railway Administration granted to the Divisional Superintendent.
There is also the evidence of Ribbins which clearly supports the vie* that the agreements to purchase foodgrains by the Divisional 892 Superintendent were part of a. scheme devised by the Railway Administration at the time of the, serious famine in 1943 in Bengal.
In cross examination, Ribbins stated: "When the Bengal famine arose in April May 1943, the (necessity for a scheme of) arrangement of supplying foodgrains to E. I. Railway employees arose .
A scheme was drawn up for carrying out this work in writing.
In other words orders were received from Head Office Calcutta about it.
The Deputy General Manager, Grains, Calcutta issued the necessary orders .
The agent or General Manager as he is called appropriated the above functionary.
He must have done so presumably under orders .
The entire scheme did subsequently get the assent of the Railway Board.
From time to time order came with instruction from Head Office.
All such directions should be in the office of D. Supdt., Dinapur.
Some posts had to be created for carrying out this scheme.
Originally one post of Asstt.
Grain Supply Officer was created.
Subsequently, two posts were created one on a senior scale and the other as Asstt.
in Dinapur Dv.
staff had to be appointed to be in charge of the grain shops.
They were exclusively appointed to work the grain shop Organisation.
The Railway made some arrangement in some places for accommodation and additional storage.
Grain shops were located At these places when accommodation was made for additional storage.
" Ribbins was for some time a Grain Supply Officer under the East Indian Railway and he admitted that orders similar.to the purchase orders in question in this litigation were drawn up in cyclostyled forms "as per orders from the Head Office.
" The witness stated that the instructions of the Head Office were "in the office file".
None of these documents were, however, produced or tendered in evidence by the Railway Administration. 893 The evidence on the whole establishes that with a view to effectuate the scheme devised by the Railway Board for distributing foodgrains to their employees at concessional rates, arrangements were made for procuring foodgrains.
This scheme received the approval of the Railway Board and Railway Officers were authorised to purchase, transport and distribute foodgrains.
If, in the implementation of the scheme, the foodgrains were received by the Railway Administration, special wagons were provided and goods were carried to different places and distributed and payments were made for the foodgrains received by the Railway Administration after testing the supplies, the inference is inevitable that the Divisional Superintendent who issued the purchase orders acted with authority specially granted to him.
The evidence of Ribbins supported by abundant docu mentary evidence establishes beyond doubt that the Divisional Superintendent though not expressly authorised by the notification exhibit M 2 to contract for the purchase of foodgrains, was specially authorised to enter into these contracts for the purchase of foodgrains.
The question still remains whether the purchase orders executed by the Divisional Superintendent but which were not expressed to be made by the Governor General and were not executed on behalf of the Governor General, were binding on the Government of India.
Section 175(3) plainly requires that contracts on behalf of the Government of India shall be executed in the form prescribed thereby ; the section however does not set out the consequences of non compliance.
Where a statute requires that a thing shall be done in the prescribed manner or form but does not set out the consequences of non compliance, the question whether the provision was mandatory or directory has to be adjudged in the light of the intention of the legislature as disclosed by the 894 object, put pose and scope of the statute.
If the statute is mandatory, the thing done not in the manner or form prescribed can have no effect or validity : if it is directory, penalty may be incurred for non compliance, but the act or thing done is regarded as good.
As observed in Maxwell on Interpretation of Statutes 10th Edition p. 376 : "It has been said that no, rule can be laid down for determining whether the command is to be considered as a mere direction or instruction involving no invalidating consequences in its disregard, or as imperative, with an implied nullification for disobedience, beyond the fundamental one that it depends on the scope.
and object of the enactment.
It may perhaps be found generally correct to say that nullification is the natural and usual consequence of disobedience, but the question is, in the main governed by considerations of convenience and justice, and when that result would involve general inconvenience or injustice to innocent persons, or advantage to those guilty of the neglect, without promoting the real aim and object of the enactment such an intention is not to be attributed to the legislature.
The whole scope and purpose of the statute under consideration must be regarded.
" Lord Campbell in Liverpool Borough Bank vs Turner(1) observed "No universal rule 'can be laid down as to whether mandatory enactments shall be considered directory only or obligatory with an implied nullification for disobedience.
It is the duty of Court of justice to try to get at the real intention of the Legislature by carefully attending to the whole scope of the statute to be construed.
" It is clear that the Parliament intended in enacting the provision contained in section 175(3) that (1) ; 895 the State should not be saddled with liability for unauthorised contracts and with that object provided that the contracts must show on their face that they are made on behalf of the State, i. e., by the Head of the State and executed on his behalf and in the manner prescribed by the person authorised.
The provision, it appears, is enacted in the public interest, and invests public servants with authority to bind the State by contractual obligations incurred for the purposes of the State.
It is in the interest of the public that the question whether a binding contract has been made between the State and a private individual should not be left open to dispute and litigation ; and that is why the legislature appears to have made a provision that the contract must be in writing and must on its face show that it is executed for and on behalf of the head of the State and in the manner prescribed.
The whole aim and object of the legislature in conferring powers upon the head of the State would be defeated if in the case of t contract which is in form ambiguous, disputes are permitted to be raised whether the contract was intended to be made for and on behalf of the State or on behalf of the person making the contract.
This consideration by itself would be sufficient to imply a prohibition against a contract being effectively made otherwise than in the manner prescribed.
Itm is true that in some cases, hardship may result to a person not conversant with the law who enters into a contract in a form other than the one prescribed by law.
It also happens that the Government contracts ,ire sometimes made in disregard of the forms prescribed ; but that would not in our judgment be a ground for holding that departure from a provision which is mandatory and at the same time, salutary may be permitted.
There is a large body of judicial opinion in the High Courts in India on the question whether 896 contracts not ill form prescribed by the Constitution Acts are binding upon the State.
The view has been consistently expressed that the provisions, under the successive Constitution Acts relating to the form of contract between the Government and the private individual are mandatory and not merely directory.
In Municipal Corporation of Bombay vs Secretary of State (1), the true effect of section 1 of Si. 22 and 23 Vic.
c. 41 fell to be determined.
The Governor General of India in Council and the Governors in Council and officers for the time being entrusted with the Government were, subject to restrictions prescribed by the Secretary of State in Council, empowered to sell and dispose of real and personal estate vested in Her Majesty and to raise money on such estate and also to enter into contracts within.
the respective limits for the purposes of the Act.
it was provided that the Secretary of State in Council.
may be named as a party to such deed, contract, or instrument and the same must be expressed to be made on behalf of the Secretary of State in Council by or by the order.
of the Governor General in Council or Governor in Council, but may be executed in other respects in like manner as other, instruments executed by or on behalf of him or them respectively in his or their official capacity, and may be enforced by or against the Secretary of State in Council for the time being.
In a suit between the Government of Bombay and the Municipal Corporation of Bombay, the latter claimed that it was entitled to remain in occupation on payment of a nominal rent, of an extensive piece of land because of a resolution passed by the Government of Bombay sanctioning such user.
Jenkins C. J. in delivering the judgement of the Court observed.
"I think that a disposition in 1865 of Crown ' (1) I. L. R. 897 lands by the Governor in Council was dependent for its validity on an adherence to the forms prescribed, and that therefore the Resolution was not a valid disposition of the property for the interest claimed.
" In Kessoram Poddar and Co. vs Secretary of State for India (1), it was held that in order that a contract may be binding on the Secretary of State in Council., it must be made in strict conformity with the provisions laid down in the statute governing the matter and if it is not so made, it is not valid as against him.
The same view was expressed in section C. Mitra and Co. vs Governor General of India in Council (2), Secretary of State vs Yadavgir Dharamgir(3), Secretary.
of State and another vs G. T. Sarin and, Company U. P. Government vs Lala Nanhoo Mal Gupta Devi Prasad Sri Krishna Prasad Ltd. vs Secretary of State (6), and in section K. Sen vs Provincial P. Way D. State of Bihar(7).
But Mr. Viswanatha Sastri on behalf of the appellant contended that this court in Chatturbhuj Vithaldas Jasanth vs Moreshwar Parashram (8) has held that a contract for the supply of goods to the Government which is not in the form prescribed by article 299 (1) of the Constitution which is substantially the same form as section 175 (3) of the Government of India Act, 1935) is not void and unenforceable.
In that case, the election of Chatturbhuj Jasani to the Parliament was challenged on the ground that he had a share or interest in a contract for the supply of goods to the Union Government.
It was found that Jasani was partner of a firm, which had entered into contracts with the Union Government for the supply of goods and these contracts subsisted on November 15, 1951 and (1) I.L.R. I.L.R. , (3) I.L.R. I.L.R. (1930) 11 Lah.375.
(5) A.I.R. (1960) All.
(6) I.L.R. (1941) All. 741 (7) (7) A.I.R. (1960) Pat.
(8) ; 898 February 14, 1952 respectively the last date for filing nominations and the date of declaration of the results of the election.
This court held that Jasani was disqualified from being elected by virtue of the disqualification set out in section 7 (b) of the Representation of the People Act 43 of 1951.
The contracts in that case were admittedly not in the form Prescribed by article 299 (1) of the Constitution, and relying upon that circumstance, it was urged that the contracts were void and had in law no existence.
In dealing with this plea, Bose J. speaking for the court observed : "We feel that some reasonable meaning must be attached to article 299(1).
We do not think the provisions were inserted for the sake of mere form.
We feel they are there to safeguard Government against unauthorised contracts.
If in fact a contract is unauthorised or in excess of authority it is right that Government should be safeguarded.
On the other hand, an officer entering into a contract on behalf of the Government can always safeguard himself by having recourse to the proper form.
In between is a large class of contracts, probably by far the greatest in numbers, which though authorised, are for one reason or other not in proper form.
It is only right that an innocent contracting party should not suffer because of this and if there is no other defect or objection we have no doubt Government will always accept the responsibility.
If not, its interests are safeguarded as we think the Constitution intended that they should be.
" The learned Judge also observed: "It would, in our opinion, be disastrous to hold that the hundreds of Government officers who have daily to enter into a variety of contracts, often of a petty nature, and sometimes in an emergency, cannot contract orally or through correspondence and that every petty contract must be effect ed by a ponderous legal document couched in a particular form." 899 The rationale of the case in our judgment does not support the contention that a contract on behalf of a State not in the form prescribed is enforceable against 'the State.
Bose J. expressly stated that the "Government may not be bound by the contract, but that is a very different thing from saying that the contract ",as void and of no effect, and that it only meant the principal (Government) could not be sued; but there will be nothing to prevent ratification if it was for the benefit of the Government.
" The facts proved in that case clearly establish that even though the contract was not in the form prescribed, the Government had accepted performance of the contract by the firm of which Jasani was a partner, and that in fact there subsisted a relation between the Government and the firm under which the goods were being supplied and accepted by the Government.
The agreement between the parties could not in the case of dispute have been.enforced at law, but it was still being carried out according to its terms : and the Court held that for the purpose of the Representation of the People Act, the existence of such an agreement which was being carried out in which Jasani was interested disqualified him.
It was clearly so stated when Bose J. observed: "Now section 7 (d) of the Representation of the People Act does not require that the contracts at 'which it strikes should be enforceable against the Government ; all it requires is that the contracts should be for the supply of goods to the Government.
The contracts in question are just that and so are hit by the section".
Reliance was also placed by counsel for the appellant upon cases decided under s.40 of the Government of India Act, 1915, which was continued in operation.
even after the repeal of the Act, 1915, by the 9th schedule to the Government of India Section 40 prescribed the manner in which the business of the Governor General in Council was to be conducted.
It provided that all orders and other proceedings of the Governor General in Council shall be expressed to be made by the Governor General in Council and shall be signed by a Secretary to the Government of India or otherwise as the Governor General in Council may direct and shall not be called in question in any legal proceeding on the ground that they were not duly made by the Governor General in Council.
In J.K. Gas Plant Manufacturing Co., (Rampur) Ltd., vs King Emperor (1), certain persons were accused of offences committed by them in contravention of cls.
(5) and (8) of the Iron and Steel (Control of Distribution) Order, 1941, which order was not expressed to be made by the Governor General in Council as required by section 40(1) of the 9th schedule to the Constitution Act.
The Federal Court held that the scope and purpose of the Act did not demand a construction giving a mandatory rather than a directory effect to the words in section 40: for, in the first instance, the provision that all orders of the Governor General in Council shall be expressed to be made by the Governor General in Council did not define how orders were to be made but only how they are to be expressed; it implied that the process of making an order preceded and was something different from the expression of it.
Secondly, it was observed, the provision, was not confined to orders only and included proceedings and in the case of proceedings, it was still clearly a method of recording proceedings which had already taken place in the manner prescribed rather than any form in which the proceedings, must take place if they are valid.
Thirdly, it was observed, that the provision relating to the signature by a Secretary to the Government of India or other person indicated that it was a provision as (1) 901 to the manner in which a previously made order should be embodied in publishable form, and it indicated that if the previous directions as to the expression of the order and proceedings and as to the signature were complied with, the order and proceedings shall not be called in question in a court of law on one ground only.
The rule contained in section 40 (1) was in the view of the court one of evidence which dispensed with proof of the authority granted by the GovernorGeneral in respect of orders or proceedings which complied with the requirements prescribed : the making of the order or the proceedings was independent of the form of the order or proceedings expressing it.
But it cannot be s aid that the making of the contract is independent of the form in which it is executed.
The document evidencing the contract is the sole repository of its terms and it is by the execution of the contract that the liability ex contracti of either party arises.
The principle of J. K. Gas Plant Manufacturing Co. 's case has therefore no application in the interpretation of section 175 (3) of the Government of India Act, 1935.
Reliance was also placed upon Dattatreya Moreshwar Pangarkar vs The State of Bombay (1) and The State of Bombay vs Purshottam Jog Naik(2).
In both these cases, orders made by the Government of Bombay under the Preventive Detention Act were challenged on the ground that the orders did not comply with the requirements of article 166 of the Constitution.
Article.
166 substantially prescribes the same rules for authentication of the orders of the Governor of a State as section 40 to the 9th schedule of the Government of India Act, 1935 prescribed for the authentication of the orders of the Governor General and the Governors.
In the former case, this court observed that (1) ; (2) ; 902 the Preventive Detention Act contemplates and requires the taking of an executive decision for confirming a detention order under section 11 (1) and omission to make and authenticate that decision in the form set out in article 166 will not make the decision itself illegal,for the provisions in that arti cle are merely directory and not mandatory.
In the latter case, an order which purported to have been made in the name of the Government of Bombay instead of the Governor of Bombay as required by article 166 was not regarded as defective and it was observed that in any event, it was open to the State Government to prove that such an order was validly made.
The court in those cases therefore held that the provisions of article 166 are directory and not mandatory.
, These cases proceed on substantially the same grounds on which the decision in J. k. Gas Plant and Manufacturing Co. 's case , proceeded, and have no bearing on the interpretation of section 175 (3) of the Government of India Act, 1935.
Reliance was also placed upon the State of U.P. vs Manbodhan Lal Srivastava(1) in which case this court held that the provisions of article 320 el.
(3) (e) of the Constitution relating to the consultation with the Public Service Commission before discharging at public servant are merely directory.
The fact that certain other provisions in the Constitution are regarded as merely directory and not mandatory, is no ground for holding that the provisions relating to the form of contracts are not mandatory.
It maybe said that the view that the provisions in the Constitution relating to the form of contracts on behalf of the Government are mandatory may involve hardship to the unwary.
But a person who seeks to contract with the Government must be deemed to be fully aware of (1) ; 903 statutory requirements as to the form in which the contract is to be made.
In any event, inadvertence of an officer of the State executing A contract in manner violative of the express statutory provision, the other contracting party acquiescing in such violation out of ignorance or negligence will not justify the court in not giving effect to the intention of the legislature, the provision having been made in the interest of the public.
It must therefore be held that as the contract was not in the form required by the Government of India Act, 1935, it could not be enforced at the instance of the appellant and therefore the Dominion of India could not be sued by the appellant for compensation for breach of contracts.
We are also of the view that the High Court was right in holding that the appellant failed to prove that he was entitled to compensation assuming that there was a valid and enforceable contract.
The appellant claimed that he was entitled to the difference between the contract price and the price realised by sale of the foodgrains offered after October 1,1943 but not accepted by the Railway Administration.
The High Court rightly pointed out that the appellant was, if at all, entitled only to compensation for loss suffered by him by reason of the wrongful breach of contract committed by the State, such compensation being the difference between the contract price and the ruling market rate on October 1,1943, and that the appellant had failed to lead evidence about the ruling market rate on October 1,1943.
The trial judge held that the "control price list xxx was reliable for ascertaining the measure of damages in the case".
This document was a notification relating to the controlled rates in operation in the district of Arrah, by which the sale of foodgrains at prices exceeding the rates prescribed was made an offence.
The appellant had obviously the option of delivering foodgrains at an railway station F. O. R. in the Province of 904 Bihar, and there is no evidence on the record whether orders similar to exhibit
M 2 were issued by the authorities in other districts of the Bihar State.
But if the grains were supplied in the district of Arrah, the appellant could evidently not seek to recover price for the goods supplied and accepted on and after October 1, 1943, at rates exceeding those fixed by the notification; for, by the issue of the control orders, on the contracts must be deemed to be superimposed the condition that foodgrains shall be sold only at rates specified therein.
If the grains were to be supplied outside the district of Arrah, the case of the appellant suffers from complete lack of evidence as to the ruling rates of the foodgrains in dispute on October 1, 1943.
The High Court was therefore right in declining to award damages.
On the view taken by us, this appeal must stand dismissed with costs.
Appeal dismissed.
[/INST]On a complaint by one L, the Magistrate convicted the two appellants of an offence under section 380 of the Indian Penal Code for having removed a printing press alleged to have belonged to L to whom it was sold in 1955 by one R once a declared keeper of the said press under section 4 of the Press Act, 1867.
The defence was that the Press originally belonged to one G.
In 1947 transferred it to N by exhibit D 2 wherein R joined formally, as declaration of keeper stood in his name.
N sold the Press to the second appellant and another, but R 's name continued as a printer and keeper of the press In 1956 the second appellant leased out the press to the first appellant.
According to the appellants, the second appellant was the owner in law and fact of the press and the first appellant was the lessee and had removed the press in the bonafide exercise of his right as lessee.
The case of the prosecution hinged upon the evidence of R and that of the appellants rested upon the proof of the signature of R on exhibit D 2 which R denied.
The handwriting expert stated categorically that exhibit D 2 bore the signature of R. The Judge of the High Court who heard the appeal against the acquittal order, passed by the Additional District and Sessions Judge, said nothing about exhibit D 2 and considered the declaration of R under section Of the Press Act which continued unchanged, as sufficient to prove an offence of theft.
According to him, the removal of the Press amounted to theft even though the appellants removed it under a bonafide claim of right.
^ Held, that where a bonafide claim of right exists, it can be a Good defence to a prosecution for theft.
An act does not amount to theft, unless there be not only no legal right but no appearance or colour of a legal right.
For the purpose of criminal law on the present case the evidence prima facia pointed to a transfer of the press by R and to N.
The evidence prima facie also established that the appellants had taken possession of the press under a 9 bonafide claim of right and there was some doubt about the right of R to transfer the press to L and further the defence that the appellants took possession of the press under bonafide claim of right was a good defence entitling them to an acquittal.
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<s>[INST] Summarize the judgementAppeal No. 441 of 1965.
Appeal from the judgment and decree dated September 19, 1958 of the Mysore High Court in Regular Appeals Nos. 154 and 196 of 1952 53.
section Govind Rao and K. Rajendra Chaudhuri, for the appellants.
C.B. Aggarwala and R. Gopalakrishnan, for the respondents. 1084 The Judgment of the Court was delivered by Bhargava, J.
One Khanmull, whose legal representatives are the appellants in the present appeal, instituted Original Suit No. 59 of 1949 50 on 10th January, 1950 for recovery of amounts due to him on the basis of two simple mortgages dated 12th January, 1937 and 14th June, 1937 in the Court of the District Judge, Civil Station, Bangalore.
Both these mortgages were executed by three brothers, Ahmed Saleh Mohamed Sait (since deceased), Elias Saleh Mohamed Sait (respondent No. 1), and Mohamed Saleh Mohamed Sait (respondent No. 2), while their mother Rahamatbai alias Bhayabai joined them in the execution of the mortgagedeed of 14th June, 1937.
In the suit, in addition to respondents 1 and 2, Hajirabai widow of the deceased brother Ahmed Saleh Mohamed Sait, and their sisters, Ameenabai and Haneefabai, were also impleaded as defendants 3, 4 and 5.
Further, Khan Saheb Abdul Gani Saheb, and Khan Saheb Abdul Shakoor Saheb were impleaded as defendants 6 and 7 in their capacity of purchasers of the equity of redemption from the mortgagors.
On the foot of the first mortgage, the amount claimed was Rs. 51,200/ as principal and interest, while, on the foot of the second mortgage, the amount claimed as principal and interest was Rs. 60,200/ .
The contractual rate of interest was 1 per cent per mensem.
The trial court decreed the suit on 27th March, 1952, after applying the provisions of section 17 of the Mysore Money Lenders Act No. 13 of 1939 (hereinafter referred to as "the Act").
For the purpose of giving effect to.the provisions of section 17 of the Act, the trial court held that the principal amount of the two loans was Rs. 44,000/ , being the aggregate of the consideration shown in the two mortgage deeds, and, consequently, allowed as arrears of interest the sum of Rs. 44,000/ .
The preliminary decree was, therefore, granted for a sum of Rs. 88,000/ composed of Rs. 44,000/ as principal and Rs. 44,000/ as interest.
The excess interest claimed at the contractual rate of 1 per cent per mensem was disallowed on the ground of the maximum limit for the grant of the total amount of interest laid down in section 17 of the Act.
Thereupon, both the parties filed appeals in the High Court of Mysore.
The High Court held that the trial court had wrongly treated the amounts of Rs. 20,000/ and Rs. 24,000/ as the principal amounts of the original loans; and recorded a finding that the principal amounts, in fact, were Rs. 15,017 8 0 in respect of the first mortgage deed, 'and Rs. 22,954/ in respect of the second mortgage deed.
The High Court, thus, worked out the aggregate of Rs. 37,971/50P as the principal amount of the two loans advanced under these two mortgage deeds and, applying section 17 of the Act, granted a decree for this amount as principal together with the same amount as interest.
The High Court further held 1085 that this would be the arrears of interest to which the appellants would be entitled up to the date fixed for payment of the redemption money by the judgment of the High Court, that date being the 19th March, 1959.
The High Court also made a direction that the principal amount will carry interest at 6% per annum from the date fixed for redemption till realisation.
The appellants have now come up against this decree passed by the High Court by certificate granted by that Court.
In this appeal, Mr. Govinda Rao, learned counsel for the.
appellants, raised only two points.
The first point urged was that the High Court was wrong in re opening the accounts in respect of loans prior to.
the two mortgage deeds which formed the consideration for the two mortgage deeds in suit, and that the.
High Court should have held that the principal amount was Rs. 44,000/ for the two mortgages as decided by the trial Court.
The second point urged by learned counsel was that the High Court was wrong in fixing the dates up to which the arrears of interest could be calculated for being included in the decree and for prescribing future rates of interest.
It was urged that the arrears of interest envisaged by section 17 of the Act should be interpreted to mean arrears only up to the date of the institution of the. suit.
and the High Court should have granted future interest subsequently instead of granting future interest only with effect from the date fixed for redemption.
So far as the first point raised by learned counsel is concerned, it appears to us that it is totally misconceived, because the language of section 17 of the Act plainly justifies the view taken by the.
High Court.
Section 17, in prescribing the maximum amount of arrears of interest to be allowed, refers to "the principal of the original loan" and not "the principal of the loan".
If the latter expression had been used, it could have been argued in the present case that the sums of Rs. 20,000/ and Rs. 24 '000/which purported to be the principal amounts of the two loans evidenced by the two mortgage deeds in suit, were the principal amounts of the loans to be taken into account in working out the maximum amount of interest permissible under section 17 of the Act.
The expression "the principal of the original loan" makes it clear that, in determining the maximum amount of arrears of interest allowable, the Court must go behind the transaction of the loan and find out what was the actual cash originally advanced as principal and ignore all interest that may have been added subsequently to that original advance in order to make up the consideration for the loans in suit.
In the present case, therefore, the High Court was justified in looking at the transactions prior to the two mortgage deeds to find out what were the actual cash amounts origi 1086 nally advanced which, together with interest and after adjustment of accounts, formed the principal amounts for the two mortgagedeeds.
It was admitted by counsel for both parties before us that the figures accepted by the High Court as the principal amounts of the two loans are correct, if the original cash advances are treated as the principal amounts of the original loans.
It is, therefore, clear that, on the plain language of section 17 of the Act, the High Court was right in holding that the aggregate of the principal amounts of the original loans was only Rs. 37,971/50 P and.
not Rs. 44,000/ and, consequently, in awarding arrears of interest only to the extent of the same amount and not a larger amount.
On the second question, we are unable to agree with the view of the High Court that the arrears of interest mentioned in section 17 of the Act mean interest calculated up to the date fixed for redemption.
At the same time, we are also unable to accept the submission made on behalf 'of the appellants that the arrears of interest in this section mean arrears of interest up to the date of the suit.
It is to be noticed that the section is in the form of a directive to a Court not to pass a decree on account of arrears of interest for a sum greater than the principal of the original loan.
This language clearly gives an indication of the intention of the Legislature.
Obviously, the directive is to be carried out by the court at the time of passing the decree and, consequently, it would be at that time that the court will see how much it is awarding for arrears of interest.
The maximum prescribed for the arrears of interest must, therefore, be held to be the maximum amount in respect of interest payable up to the date of the decree when the court carries out the directire laid down in this section.
In the present case, the trial Court passed the decree on the 27th March, 1952 and, consequently, the amount of Rs. 37,971/50 P awarded as arrears of interest must be the arrears of interest due up to that date.
The High Court, in our opinion, was not correct in holding that these arrears of interest will cover interest due up the date fixed for redemption by the High Court.
In this connection, learned counsel for the respondents urged that the arrears of interest envisaged by section 17.
of the Act should be held to include interest due up to the date of the decree by the High Court, because that is the effective decree granting interest to the mortgagees; but this arguments overlooks the principie of law that the decree of an appellate Court takes effect from the date of the decree of the original court.
In this case, therefore, even though the High Court passed the appellate decree at a later date, that decree has to.
be deemed to have come into 1087 effect from 27th March, 1952 which was the date of the decree of the trial Court, so that no question can arise of holding that the arrears of interest under section 17 of the Act must be computed up to the date on which the High Court passed the decree.
The further point that arose was as to the interest which the appellants could claim after the date of the decree, viz. 27th March, 1952, on the amount decreed.
On behalf of the appellants, reliance was placed on Order 34, r. 11 of the Code of Civil Procedure and it was urged that interest.
should be allowed after that date in accordance with the provisions of that rule.
The High Court has expressed the opinion that, if interest is allowed under r. 11 of Order 34, C.P.C., it would be in conflict with section 17 of the Act; but we are unable to see any such conflict.
Section 17 of the Act confines itself to laying down the maximum of arrears of interest to be allowed up to the date of the decree and is not concerned with the interest that is to be allowed for the period thereafter.
Admittedly, the Code of Civil Procedure was applicable to this suit and, consequently, interest subsequent to the date of the decree had to be awarded in accordance with Order 34, r. 11, C.P.C.
Under r. 11(a)(i), interest would be payable on the principal amount found or declared due on the mortgage, from the date of the decree up to the date fixed for payment, at the rate payable on the principal, or, where no such rate is fixed, at such rate as the Court may deem reasonable.
In this case, the date of the decree by the trial Court was 27th March, 1952, while the date fixed for payment became 19th March, 1959 as a result of the decree of the High Court.
The interest for this period has to be calculated in accordance with r. 11(a)(i) of Order 34, C.P.C., on the principal amount of Rs. 37,971/50 P. As regards the rate, it is true that, under the mortgage deeds, the interest was payable @ 1% per mensem but, under the provisions of the Act read with the provisions of the Usurious Loans Act (Mysore Act IX of 1923), the fair interest payable on the loan would be @ 9 per cent per annum and it is at this rate that the interest must be calculated on this principal amount for this period.
In addition, under r. 11(a)(ii) of 0.34, C.P.C., interest @ 6% per annum has to be allowed on the amount decreed for costs, charges and expenses incurred by the appellants up to the date of the preliminary decree.
A further direction that is necessary is that interest under r. 11 (b) of 0.34.
C.P.C., will be payable up to the date of realisation or actual payment on the aggregate of the two principal sums just mentioned @ 6% per annum which must be deemed to be reasonable as interest at that rate is ordinarily awarded in all decrees in respect of future periods.
1088 The result is that the decree passed by the High Court will have to be amended in respect of calculation of interest in the manner indicated by us above.
The appeal is partly_ allowed to this extent.
In the circumstances of this case, we direct parties to bear their own costs of this appeal.
G.C. Appeal partly allowed.
[/INST]To ensure against the grave nuisance which may be caused to the residents of a locality if carcasses of dead animals are allowed to remain on the premises within the city, 'a duty is imposed by sections 367, 372 and 385 of the Bombay Municipal Corporation Act, 1888, as amended by Act 14 of 1961, upon the owner of the animal or the person having charge of the animal or the occupier of premises in which the animal .dies, to remove the carcass at his own expense with the permission of the Commissioner of the City of Bombay.
or, to have.
it removed through the agency of the Corporation, for which he was required to pay a fee of Rs. 20.
It was further enacted that after it was removed it shall be deposited in 'a receptacle, depot or other place set apart for the purpose, either by the owner or the Corporation.
Thereupon, the owner lost his property in the carcass and ' it became the property of the Corporation.
Under the Act it was the duty of the Corporation to arrange for its disposal causing the least practicable nuisance.
The second respondent was the owner of a stable of filch cattle in Bombay.
He was selling the carcasses of animals dying in his stable for a price.
The first respondent was a purchaser of carcasses and carried on the business of skinning the dead animals and utilising the products for industrial uses.
The Corporation prohibited the first respondent from removing carcasses and resolved to grant the contract for the disposal of carcasses deposited under the provisions of the Act to Harijan Workmen 's Cooperative Labour Society.
The respondents challenged the provisions and the High Court declared them ultra vires.
In appeal to this Court, on the questions: (1) Whether the obligation not to sell the carcass but to dispose it of as per the provisions of the Act infringe the fundamental rights of the respondents under article 19(1)(f); (2) Whether there was infringement of the fundamental right because of the obligation on the second respondent to incur expenditure for its removal; (3) Whether fee of Rs. 20 was excessive; (4) Whether the second respondent 's loss of ownership and property in the carcass on depositing it as per the provisions of the Act violated the.
respondents ' fundamental right under article 31; and (5) Whether the granting of the contract to the Harijan Society destroyed the business of the first respondent and infringed its fundamental right to carry on business.
HELD: (1) The second respondent had a right of ownership in the carcasses of his animals.
But he was only entitled to constitutional protection against unreasonable restriction on his right to sell the carcasses.
393 Reasonableness of restrictions imposed by a law has to be.
adjudged in the light of the nature of the right, danger or injury which may be inherent in the unbridled exercise of the right and the necessity of protection against danger which may result to the public by the exercise of the right.
In each case the test is whether the restriction is commensurate with the need for protection of public interest against the exercise of the right.
[400 C; 402] A mere imposition of an injunction to remove a carcass only abates the nuisance arising from a dead animal remaining on the premises: it does not eliminate the graver hazard caused by the adulteration of food of the people from its products.
Meat and fat from carcasses are used by unscrupulous persons for adulterating the food of the community.
Even b.y imposing stringent supervision upon persons carrying on the business of skinning carcasses,, protection of the community against food adulteration cannot be effectively secured, because, a purchaser who was not subject to the Corporation control could remove it beyond the Corporation limits and bring back contaminated meat and fat.
Therefore, the Legislature has devised a scheme by which reasonable restrictions are placed upon a citizen 's right to dispose of the carcass.
Under the Act, the Corporation has to set apart a place for depositing the carcass and it is implicit in the scheme of the Act that the Corporation shall provide a suitable place for skinning it.
The Corporation has control over the contractors entrusted with the disposal of carcasses and has supervision over the disposal of the products.
A law which compels the removal of a carcass to an appointed place and its disposal under the supervision of the Corporation which has the duty to take steps for maintaining public health, cannot be regarded as arbitrary or excessive.
The Corporation, has to arrange for effectively disposing of the carcass and it would be necessary for effectuating that purpose to provide that the tatle of the owner in the carcass should be extinguished.
Such a provision is not beyond ' the legitimate purpose for which it was intended, and the fact that the owner is unable to sell for a price the carcass does not render a provision, which is essentially conceived in the interest of the general public,unreasonable.[401 E H;402 B D; 403 E; 404 D] Restriction upon the right of the owner to sell the carcass does not directly infringe the fundamental right of the purchaser.
who, but for the restriction may have been able to purchase it.
Assuming however, that the imposition by law of the restriction upon the owner of the carcass involves also a restriction upon the right of the first respondent having regard to the character of t_he legislation and its avowed object,the restriction upon the first respondents right to carry on his occupation or business is a reasonable one within the meaning of Art 19(5) and (6).
[409 E G] .
Chintaman Rao vs State of M.P. [5950] S.C.R. 759 and State Row; , , followed.
(2) If the carcass is likely to be deleterious to public health and its removal from the place where it is lying being in the interests of the public health, imposition of an obligation upon the owner to remove the carcass at his own expense or to Pay for its removal cannot be regarded as unreasonable, even if the charge which falls upon the owner is in addition to the loss which he suffers by reason of the extinction of his tetle in the carcass.
[404 B D] (3) Whether the fee of Rs. 20 levied on the owner of a carcass for its removal was in excess of the expenditure which the Corporation may go.
Cll69 s 394 have to incur.
was not investigated into by the High Court.
and therefore the question could not, be raised for the first time in this Court.
[404 A B] (4) (a) In the present case, the restrictions imposed by the impugned law upon the right of the owner satisfy the test of reasonableness under article 19(5) and (6).
Therefore, though there is a deprivation of property, it is by a valid law and hence there is no violation of article 31(1).
[406 C D] Smt.
Sitabati Debi vs Stale of West Bengal, , followed.
Kavalappara Kottarathil Kochuni vs State of Madras, referred to.
(b) A law which provides for extinction of the ownership and creation of an interest in the Corporation for .the purpose of disposal of the carcass is not a law for acquisition 'of property for a public purpose: its primary purpose is destruction of a carcass in the public interest, and not its utilisation for a public purpose.
The case does not, therefore, fall within the terms of article 31(2).
[406 F G] (c) In any case the statute is squarely protected by article 31 (5) (b) (ii) and on that account the owner is not entitled to compensation for loss of his property.
Where the State acquires property and seeks to utilize it for promotion of public health or prevention of danger to life or property the State is liable to pay compensation.
But a law which directive and immediately seeks to promote public health or to prevent danger to life or property falls within the exemption of cl.
(5)(b)(ii) even if thereby, the owner 's interest in the property is extinguished and is vested in the State for purposes of destruction.
[406 G H; 407 A B] (d) Article 31(5)(b)(ii) is not confined to 'temporary occupation of property.
In the case of acquisition of immovable property, to have the protection of the clause the occupation of the property must be temporary.
But in the case of movable property, even if its possession is taken with a view to destroying it, if such destruction is in the interests of general public, that is.
for the prevention of danger to life or property, it need not be temporary.
Even such taking of movable property will be protected by cl.
(5) (b) (ii) and the guarantee of article 31(2) would not be attracted.
[408 E G] Deputy Commissioner and Collector, Kamrup vs Durganath Sarma, ; , explained.
The first respondent cannot claim the protection of article 31(2), because, until it purchases the carcasses from the owner it has no right in the property, and it cannot set up a grievance for loss of property which it does not own.
[409 H] (5) Whether by virtue of the contracts given by the Corporation to other persons who are claimed to be rivals in business of the first respondent unreasonable restrictions may be deemed to be placed upon the first respondent 's fundamental right is a matter on which no argument Was advanced before the High Court.
In any event, it cannot affect the validity of the statute or its provisions.
[410 B D]
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<s>[INST] Summarize the judgementN: Civil Appeal Nos. 3321/82 and 3524 of 1983.
From the Judgment and Order dated 2.5.
1980 of the Punjab and Haryana High Court in C.W.P. Nos.
677/79 and 97/79.
P.P. Rao and C.M. Nayar for the Appellants in both the appeals.
N.S. Das Behl for the Respondent in C.A. No. 3524 of 1983.
Awadh Behari Rohtagi, Mahabir Singh, A.G. Prasad and Prem Malhotra for the state of Haryana.
The Judgment of the Court was delivered by K. RAMASWAMY, J.
1.
Since common questions of facts and law arise for decision in these two appeals, they are dis posed of by a common judgment.
Civil Appeal No. 3221/82 and Civil Appeal No. 3524/83 arise out of the common judgment in Civil Writ Petition Nos.
677/79 and 97/79 and a few other petitions dated May 2, 1980, on the file of High Court of Punjab and Haryana at Chandigarh.
The writ petitions were dismissed and the appellants had leave of this court under Article 136 of the Constitution.
The facts lie on a short compass 538 and reference to the facts on record in Civil Writ No. 97 of 1979 are sufficient for disposal of these appeals.
Writ Petition No. 97 of 1979 relates to Punjab service while Civil Writ Petition No. 677/79 relates to Haryana.
The appellants were direct recruits to the ministeri al services in the subordinate offices of the Directorates of Agriculture of the respective states.
Admittedly all are governed by Punjab Subordinate Agricultural Service Rules 1933, for short 'rules '.
The respective state Governments upgraded on February 8, 1979 offices of the Directorates as 'A ' Class and the Subordinate Offices situated elsewhere remained as 'B ' Class.
The appellants and other filed writ petitions on February 26, 1976 seeking a writ of mandamus to direct the respondents to upgrade the Subordinate Offices of the Department of Agriculture as 'A ' Class; to treat the appellants on par with the similar employees working in the office of the Directorates of Agriculture; treat the Direc torate of Agriculture and Subordinate Offices as one depart ment for maintaining common seniority of all of them; to upgrade their scales of pay on the basis of the said senior ity and to quash the order dated February 8, 1979 declaring the Directorate as 'A ' Class as wholly arbitrary and dis criminatory.
Pending appeals, the respective Governments by proceedings dated March 2, 1982 classified the Directorate and Subordinate Offices as 'A ' Class.
The Government have also accorded equal pay to the employees similarly situated.
Therefore, the only question that survives to be resolved is whether the Subordinate Offices and the Directorate would be treated as one unit and common seniority of all the employ ees should be maintained.
Shri P.P. Rao and Shri C.M. Nayyar, learned counsel for the appellants in the respective appeals contended that the appellants were selected along with the persons appoint ed in the office of the respective Directorates.
They pos sessed the same qualifications; their scales of pay are now the same.
Their service conditions are also the same under the rules, and therefore, they are entitled to maintenance of common seniority for the purpose of promotion.
It is seen that the appointments were made somewhere in 1973.
From the list produced before us in Civil Appeal No. 3221/82 relating to the State of Haryana, among the persons selected by the Recruitment Board, though some of the persons are found to have secured higher ranking in the list prepared by the Selection Board, they were appointed to the Subordinate Offices while persons below them, in ranking were appointed in the Directorate.
When we enquired from the counsel for the State Shri Rohtagi, the learned Senior Counsel has produced before us the not 539 ings which show that the Director had taken five of them, one of whom had secured first class in Matriculation, two ex service candidates and two candidates who secured higher percentage of marks at the qualifying matriculation examina tion.
In the view we are taking this solitary circumstances does not militate against the ultimate conclusion that we have reached in the matter.
Admittedly, rule 3 of the rules provides that the service shall consist of seven sections and in each section there shall be such number of posts whether permanent or temporary of each grade specified in the appendix as the Local Government from time to time may determine.
Under rule 4(1) the Director of Agriculture shall make appointment to all the posts in the service except the post of Junior Clerks, other than those sanctioned for Head Office, Mukaddams and the posts shown under Section 7 of the appendix.
All other appointments shall be made by the Head Office concerned, vide rule 4(").
Rule 7 prescribes the method of recruitment.
Rule 7(1)(I) specifies thus: "In the case of Superintendent, Office of the Director (i) by promotion from the amongst the Head Assistants em ployed in the office, or (ii) by selection from amongst Superintendents or Head Assistants with at least five years clerical experience in other Government office.
" Rule 7(i)(J) read thus: "In the case of Head Assistant (i) by promotion from amongst Assistant and Stenographers with clerical experience who have proved their fitness for the appointment, or (ii) by selection from amongst clerks employed in the office of Government other than the office of the Director." Rule 7(1)(K): the case of Superintendent or Head Clerk of a Subordinate Office 540 (i) by promotion from amongst Senior Clerks who have proved their fitness for the post, or (ii) by selection from amongst clerks employed in Government Office other than the office in which the post/office is to be filled.
" Rule 7( 1)(L): "In the case of Assistant (i) by promotion from amongst Senior Clerks in their respec tive offices who have proved their fitness for appointment to the post; or (ii) by selection from amongst clerks employed in Government Offices other than the office in which the post is to be filled; or (iii) by direct recruitment provided that no graduate not already in Government service shall be appointed to be an Assistant unless he has been recommended as fit for appointment by the Punjab University Appointment Board.
" Sub rule (2): "Appointment to any post by the promotion of officials already in service or by the transfer of officials shall be made strictly by selection and no official shall have any claim to such an appointment as of right.
" The candidates have to undergo probation as provided in Rule 9, the details of which are not relevant.
Rule 10 provides seniority of members of the service.
The seniority of the members in the service shall, in each class of ap pointment shown in the appendix, be determined by the dates of their substantive appointment on probation or otherwise to a permanent vacancy in such class.
The other details are not necessary.
Hence omitted.
In the appendix, the office of the Director of Agri culture, Section 6 mentions ministerial posts of Superin tendent, Head Assis 541 tants, Assistants, Stenographers, Senior Clerks, Junior Clerks.
Their varying pay scales have also been mentioned, the details of which are now not material.
In the Subordi nate Offices one Superintendent, seven Head Clerks and two Senior Clerks are the cadres.
A resume of these rules clearly shows that for the appointment of all the posts including Junior Clerks in the Head Office, the appointing authority is the Director.
All appointments to the post of Junior Clerks other than Head Office shall be by the concerned Head Office.
As per the appendix, the staffing pattern in the Office of the Director of Agriculture and the Subordinate Offices is entirely different.
The only common element is the Senior Clerks.
The seniority is to be maintained on the basis of the substan tive appointment to the respective cadres.
The seniority Of the members of the service shall, in each class of appoint ment shown in the appendix be determined by the date of their substantive appointment or promotion or otherwise to permanent vacancies in such a class.
The method of appoint ment has been adumbrated under Rule 7(1)(I) to (L) by promo tion from amongst the persons working in the respective subordinate posts in the respective offices in the first instance, or by selection from amongst persons working in the Government Offices including Subordinate Offices and in some cases by the direct recruitment.
Thereby it is clear that for filling up the vacancies arising in the post of Superintendent, Assistants and Senior Clerks, the persons working in the Subordinate Offices or the Government Offices are the feeder channels, or in some cases by direct recruit ment.
Sub rule (2) of Rule 7 makes the matter clear that they have got right to be considered, but it is strictly by selection and they have no claim to the appointment as of right.
It is open to the Government to constitute different cadres in any particular service as it may choose according to its administrative convenience and expediency.
The office of the Director is the apex office obviously to control and oversee the functioning of the subordinate offices and the other allied departments under his control monitoring the implementation of the Government 's agricultural programmes.
It may not be necessary to maintain a common cadre of the employees of the Directorate and the Subordinate Offices.
Each cadre is a separate service or a part of the service sanctioned for administrative expediency.
Therefore, each may be a separate unit and the posts allocated to the cadre may be permanent or temporary.
It is seen from the appendix that in the office of the Directorate there is one Superin tendent, three Head Assistants, four Assistances, two Ste nographers, seven Senior Clerks and twelve Junior Clerks.
In the Subordinate Offices, there is one Superintendent, seven Head Clerks and two 542 Senior Clerks.
This is obviously on the basis of administra tive need.
No doubt the office of the Directorate and the Subordinate Offices have been compendiously shown in Section 6 of the Appendix.
That does not by itself mean that office of the Directorate and Subordinate Offices are treated under the rules as one unit or at par.
as contended for by Shri P.P. Rao.
As pointed out in the beginning, the Director had committed some irregularities at the time of initial ap pointments in the year 1973 when he picked up five persons out of the select list of the candidates and appointed them in the Directorate of Haryana Government deviating from the order of merit prepared by the Board.
They were selected at a common selection by the Recruitment Board along with other candidates who stood higher in the order of merit prepared by the Selection Board.
But this was done in the year 1973 and the appointments have not been challenged till date of filing of the writ petition in 1979.
Even in the writ peti tion no challenge was made.
This is pressed into service only to show that the appellants are similarly situated with them.
After the appointments were made and the candidates joined in the respective posts for consideration for promo tion the Rules occupy the field and the claims are to be considered according to Rule 7.
Therefore, though we may not agree with the learned counsel for the State that the Direc tor had absolute discretion to pick and choose arbitrarily and make appointment of the posts, yet undoubtedly, he had power to appoint them.
Normally the order of appointment would be in the order of merit of candidates from the list and must be in accordance with rules.
His exercise of power should not be arbitrary.
The absence of arbitrary power is the first postulate of rule of law upon which our whole constitutional edifice is based.
In a system governed by Rule of Law, discretion when conferred upon an executive authority must be confined within clearly defined limits.
The rules provide the guidance for exercise of the discre tion in making appointment from out of selection lists which was prepared on the basis of the performance and position obtained at the selection.
The appointing authority is to make appointment in the order of gradation, subject to any other relevant rules like, rotation or reservation, if any, or any other valid and binding rules or instructions having force of law.
If the discretion is exercised without any principle or without any rule, it is a situation amounting to the anti thesis of Rule of Law.
Discretion means sound discretion guided by law or governed by known principles of rules, not by whim or fancy or caprice of the authority.
We refrain from going into the correctness of the choice made by the Director due to latches in not assailing the correct ness of the appointment for well over six years.
The validi ty of the rules have not been questioned.
The only question is, as stated earlier, whether the 543 employees working in the Head Office and the Subordinate Office are entitled to common seniority.
The rules them selves made a distinction between the persons appointed in the Directorate and the Subordinate Offices as separate cadres and the subordinate cadre in some cases is the feeder cadre for promotion to the post in the Head Office.
In this view, by no stretch of imagination, the appellants can be considered to be equally placed for treating them at par with the Directorate employees for being treated as being in a common cadre.
There is reasonable nexus to differentiate the two cadres.
Therefore, the classification cannot be said to be arbitrary violating Articles 14 and 16 of the Consti tution.
It is not necessary to burden the judgment with the decisions cited by either counsel as they are not directly or nearer to the core in the case.
Accordingly we hold that the appellants are not entitled to be treated at par with the employees working in the respective Directorates for giving direction to the respondents to maintain common seniority between the employees of the Directorate and Subordinate Offices.
The appeals are accordingly dismissed, but without costs.
T.N.A. Appeals dis missed.
[/INST]The appellants belonging to the ministerial service in the subordinate offices of the Directorates of Agriculture of the States of Punjab and Haryana filed writ petitions in the Punjab and Haryana High Court seeking a direction that subordinate offices and the Directorates should be treated as one unit and common seniority of all the employees should be maintained.
The High Court dismissed the petitions.
Hence these appeals by special leave.
In these appeals it was contended that the appellants are entitled to common seniority with their counterparts in the Directorates because their service conditions, pay scales and qualifications were same.
In 536 order to show similarity with their counterparts in the Directorates it was also pointed out that though a common selection was made for Directorates and subordinate offices yet the appointing authority picked up some candidates out of the select list and appointed them in the Directorates thereby deviating from the order of merit prepared by the Selection Board.
Dismissing the appeals, this Court, HELD: 1.
The Punjab Subordinate Agricultural Service Rules 1933 themselves made a distinction between the persons appointed in the Directorate and the Subordinate Offices as separate cadres and the subordinate cadre in some cases is the feeder cadre for promotion to the post in the Head Office.
In this view by no stretch of imagination, the appellants can be considered to be equally placed for treat ing them at par with the Directorate employees for being treated as being in a common cadre.
There is reasonable nexus to differentiate the two cadres.
Therefore, the clas sification can not be said to be arbitrary violating Arti cles 14 and 16 of the Constitution.
[543A B] 1.1 The fact that the office of the Directorate and the subordinate offices have been compendiously shown in section 6 of the Appendix to Rules does not by itself mean that office of the Directorate and Subordinate Offices are treat ed under the rules as one unit or at par.
[542A] 2.
It is open to the Government to constitute different cadres in any particular service as it may choose according to its administrative convenience and expediency.
[541E] 2.1 The office of the Director is the apex office obvi ously to control and oversee the functioning of the subordi nate offices and the other allied departments under his control monitoring the implementation of the Government 's agricultural programmes.
It may not be necessary to maintain a common cadre of the employees of the Directorate and the Subordinate offices.
Each cadre is a separate service or a part of the service sanctioned for administrative expedien cy.
Therefore, each may be a separate unit and the posts allocated to the cadre may be permanent or temporary.
[541F G] 2.2 Accordingly the appellants are not entitled to be treated at par with the employees working in the respective Directorates for giving direction to the respondents to maintain common seniority between the employees of the Directorate and Subordinate Offices.
[543D] 537 3.
Normally the order of appointment would be in the order of merit of candidates from the list and must be in accordance with rules.
The exercise of power should not be arbitrary.
The absence of arbitrary power is the first postulate of rule of law upon which our whole constitutional edifice is based.
In a system governed by Rule of Law, discretion when conferred upon an executive authority must be confined within clearly defined limits.
The rules provide the guidance for exercise of the discretion in making ap pointment from out of selection lists which was prepared on the basis of the performance and position obtained at the selection.
The appointing authority is to make appointment in the order of gradation, subject, to any other relevant rules like, rotation or reservation, if any, or any other valid and binding rules or instructions having force of law.
If the discretion is exercised without any principle or without any rule, it is a situation amounting to the antith esis of Rule of Law.
[542D E, F] 3.1 Discretion means sound discretion guided by law or governed by known principles of rules, not by whim or fancy or caprice of the authority.
1542G]
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<s>[INST] Summarize the judgementCivil Appeal No. 967 of 1975.
(From the judgment and order dated 13 2 1974 of the Calcut ta High Court in Copyright No. 2/73).
A.K. Sen, E.P. Skons James, J. 1.
Mehta, J. Roy Choud hary, S.K. Mehta, K.R. Nagaraja and P.N. Puri, for the appellant.
section Chaudhury, R.K. Bachawat, D.K. Sinha, H.S. Parihar and I. N. Shroff, for respondents 1 5 and 12 and 22.
J.C. Bhat, Atul Munim and B.R. Agarwala, for respondents 6 8.
B. Sen, B.K. Bachawat, D.K. Sinha, H.S. Parihar and I. N. Shroff, for respondents 12 and 22.
J.L. Nain, Atul Munim and B. R. Agarwala, for re spondent No. 19.
, V.R. Krishna Iyer, J. also gave a separate opin ion.
JASWANT SINGH, J.
This appeal by certificate granted under Article 133(1) of the Constitution by the High Court of Judicature at Calcutta which is directed against its judgment dated February 13, 1974, raises the following substantial question of law of general importance : "Whether in view of the provisions of the , an existing and future rights of music . composer, lyricist is capable of assignment and whether the producer of a cinematograph film can defeat the same by engaging the same person.
" The facts giving rise to the appeal are: The Indian Performing Right Society Ltd. (hereinafter referred to for the sake of brevity as 'the IPRS '), the appellant before us, was incorporated in the State of Maharashtra on August 23, 1959, as a company limited by guarantee, for the purpose of carrying on business in India of issuing or granting li cences for performance in public of all existing and future Indian Musical works in which copyright subsists in India.
The incorporation of the IPRS was in terms of section 2(r) of the , 211 1957 (Act 14 of 1957) (hereinafter referred to as 'the Act ') which was enacted after taking into consideration the Report of the (British) Copyright Committee,1952, the suggestions of the various Ministries of the Government of India and the State Governments, the Indian Universities and certain interested industries and associations who were invited to send their comments on the subjects of copyright.
The IPRS has amongst its members the composers of musical works, authors of literary and dramatic works and artists.
In accordance with the provisions of section 33 of the Act, the IPRS published on September 27, 1969 and November 29, 1969 in the 'Statesman ' and the Gazette of India respectively a tariff laying down the fees, charges and royalties that it proposed to collect for the grant of licences far perform ance in public of works in respect of which it claimed to be an assignee of copyrights and to have authority to grant the aforesaid licences.
A number of persons including various associations of producers of cinematograph films who claimed to be the owners of such films including the sound track thereof and the Cinematograph Exhibitors Association of India filed objections in respect of the aforesaid tariff in accordance with the provisions of section 34 of the Act repudiating the claim of the IPRS that it had on behalf of its members authority to grant licences for.
performance in public of all existing and future musical works which are incorporated in the sound track of cinematograph films in which copyright may subsist in India or the right to collect in relation thereto any fees, charges or royalties.
The association of producers averted inter alia that their members engaged composers and sound writers under contracts of service for composing songs to be utilised in their films; that the musical works prepared by the composers of lyric and music under contract of service with their mem bers producers of the cinematograph films having been utilised and incorporated in the sound track of the cinemat ograph films produced by the latter, all the rights which subsisted in the composers and their works including the right to perform them in public became the property of the producers of the cinematograph films and no copyright sub sisted in the composers which they could assign to and become the basis of the claim of the IPRS under section 33 of the Act; that their members i.e. the producers of cine matograph films being the authors and first owners of the copyright in the cinematograph films produced by them had the exclusive right inter alia to cause the said films in so far as the same consisted of sounds (which include musical works) to be heard in public as also the exclusive right to make records embodying the sound track of the films produced by them (including any musical work incorporated therein) and to cause the said records to be beard in public; that in the making of a cinematograph film as contemplated by the Act a composer composes a lyric or music under a contract of service or for valuable consideration which is substantial a music director sets it to tunes and imparts music to it and a singer sings the same but none of them nor any one of their aforesaid works can and have any separate copyrights; that motion picture is the combination of all arts and music in the sound track which cannot be detached from the film itself; that the purpose of making a motion picture is not only to complete it but also to publicly exhibit it through out the world; that having regard to the provisions of the Act the ' copyright in the case of 212 a cinematograph film vests in the owner of the film as defined in section 2(d) (v) of the Act; and that in the premises any assignment purporting to have been made in favour of the IPRS was void and of no effect and was incapa ble of conferring any rights whatsoever in such musical works on the IPRS.
The Cinematograph Exhibitors Association of India also filed objections challenging the right of the IPRS to charge fees and royalties in respect of performance in public of the musical works incorporated in the sound track of the films.
Besides raising contentions identical to those raised by various associations of producers they averred that copyright in a cinematograph film which vested in the producers meant copyright in the entirety of the film as an integrated unit including the musical work incorporated in the sound track of the film and the right to perform the work in public; that in accordance with the agreement with the distributors of films the exhibition of cinematograph film includes the right to play in public the music which is an integral part and parcel of the film; that the producers lease out copyrights of public performance of the films vested in them to the distributors who give those rights to the exhibitors an agreement and that when an exhibitor takes a licence for exhibition, it is complete in all respects and a third party like the IPRS cannot claim any licence fee from the exhibitors.
On the aforesaid objections being referred to it for determination under section 35 of the Act, the Copyright Board expressed the view that in the absence of proof to the contrary, the composers of lyrics and music retained the copyright in their musical works incorporated in the sound track of cinematograph films provided such lyrical and musical works were printed or written and that they could assign the performing right in public to the IPRS.
The Copyright Board further held that the tariff as published by the IPRS was reasonable and the IPRS had the right to grant licences for the public performance of music in the sound track of copyrighted Indian cinematograph films and it could collect fees, royalties and charges in respect of those films with effect from the date on which the tariff was published in the Gazette of India.
Aggrieved by the decision of the Copyright Board, the objectors preferred an appeal under section 72 of the Act to the High Court which allowed the same holding that unless there is a contract to the contrary, a composer who composes a lyric or music for the first time for valuable considera tion for a cinematograph film does not acquire any copyright either in respect of film or its sound track which he is capable of assigning and that under proviso.
(b) to section 17 of the Act, the owner of the film at whose instance, the composition is made, becomes the first owner of the copy right in the composition.
The High Court further held that "the composer can claim a copyright in his work only if there is an express agreement between him and the owner of the cinematograph film reserving his copyright".
The High Court also held that "though section 18 of the Act confers power to make a contract of assignment, the power can be exercised only when 213 there is an 'existing or future right to be assigned and that in the circumstances of the present case, assignment, if any, of the copyright in any future work is of no effect".
Dissatisfied with this decision, the IPRS has,as already stated, come up in appeal to this Court.
The copyright law in our country being fairly complicat ed because of the involved language in which some of its provisions are couched and the case being of first impres sion, learned counsel for the parties have tried hard to help us in solving the knotty points by advancing copious and able arguments.
Appearing on behalf of the appellant, Mr. Ashok Sen has urged that the author (composer) of a literary or musical work has copyright which includes inter alia the exclusive right (a) to perform the work in public 'and (b) to make any cinematograph film or a record in respect of the work; that copyright in a literary or musical work is infringed by any person if without a licence granted to him by the owner of the copyright, he makes a cinematograph film in respect of the work or performs the work in public by exhibiting the cinematograph film; that if a person desires to exhibit in public a cinematograph film containing a musical work, he has to take the permission not only of the owner of the copyright in the cinematograph film but also the permission of the owner of the copyright in the literary or musical work which is incorporated in the cinematograph film, as according to section 1. 3 (4) of the Act, the copyright in a cinematograph film or a record does not affect the separate copyright in any work i.n respect of which or a substantial part of which, the film, or as the case may be, the record is made; that the provisions of section 17(b) of the Act have no application to a literary or musical work or the separate copyright therein and do not take away the copyright in a literary or musical work em bodied in a cinematograph film; that the only modes in which the author of a literary or musical work ceases to be the owner of copyright m the work are (a) by assignment, '(b) by relinquishment and (c) by the composer composing the work in 'the course of his employment under a contract of service with an employer in which case, the employer becomes the owner of the copyright in the musical work; that in the case of an assignment of copyright in future work and the employ ment of the author to produce a work under a contract of service, the question of priorities will be decided ac cording to the principle "where equities are equal, the first in time shall prevail".
Mr. Sachin Chaudhary, learned counsel for respondents 1, 2 and 3, as well as Mr. J.C. Bhat, learned counsel for respondents 6, 7 and 8, and Mr. J.L. Nain, learned counsel for respondent 19, who followed Mr. Chaudhary have on the other hand submitted that the dispute in the instant case, according to the petition of appeal, the judgment of the Copyright Board and the judgment of the Calcutta High Court is confined to the sound track associated with a cinemato graph film (which expression, according to Copinger and Skone James on COPYRIGHT, means "any record of sounds which is incorporated in any print, negative, tape or other arti cle on which the film or part of it, in so far as it con sists of visual images, is recorded, or which is issued by the maker 214 Of the film for use in conjunction with such an article"); that the contention advanced on behalf of the appellant that copyright in a literary or musical work incorporated in the sound track of a cinematograph film vests in the composer of literary or musical work and when the cinematograph film is performed i.e. exhibited in public, the composer is entitled to fee or royalty in that behalf and since the appellant is the assignee of the copyright from the composers, it has the right to collect the fee or royalty is entirely unfound ed; that unlike (the law) in England, in India unless a music is notationally written, printed or graphically repro duced, it is not musical work within the meaning of the and there is no copyright 'in songs or orches tral pieces sung or played directly without its notation being written ' that since a 'cinematograph film ' is defined in section 2(f) of the 'Act as including the sound track and the 'cinematograph ' is required to be construed to include any work produced by any process analogous to cine matography, the owner of the cinematograph film is the firt owner of the copyright therein including the right of the composer of the literary or musical work incorporated in the sound track of the film; that in the case of the film in which a lyric (which literally means a short poem directly expressing the poet 's own thoughts and sentiments in stan zas falling within the purview of the expression "literary work" as defined in section 2(0) of the Act) has been plagiarised, there will be copyright in the film vesting in the producer; that the Act confers a separate copyright on a cinematograph film as a film, its author under section 2(d)(v) of the Act being the owner of the film at the time of its completion; that in the case of a lyric or music incorporated in the sound track of a cinematograph film, since under section 2(f) of the Act, cinematograph film includes its sound track and section 13(1)(b) of the Act confers copyright on the cinematograph film and section 14(c) (ii) of the Act confers on the owner of copyright the.
right to cause the film in so far as it consists of visual images to be seen in public and in so far as it consists of songs to be heard in public, it is not necessary for the owner of the cinematograph film to secure the permission of the composer of the lyric or of the music incorporated in the sound track of a cinematograph film for exhibiting or causing the exhibition of the sound portion of the film in public or for causing the records of the sound track of the film to be heard in public.
They have further urged that it is not correct to say that under section 17, proviso (b) in order that the producer of the cinematograph film should have copyright in the literary or musical work incorporated in it, the making of the entire film should be commis sioned.
According to counsel for respondents section 17 proviso (b) will equally apply if someone is commissioned to make any component part of a cinematograph film such as a lyric or musical work i.e. when such component of the film is made at the instance of a film producer for valuable consideration, the copyright for such component shall as well vest in the producer; that as the Act confers a sepa rate copyright on a cinematograph film as a film, the pro ducer can exercise both the rights conferred on him under section 14(1).(c)(ii) of the Act and all that section 13(4) of the Act (when applicable) provides is that the rights created by section 14(1)(a) and (b) shall co exist with those created by section 14(1)(c) and (d) of the Act, e.g. under clause (a), the 215 copyright in a literary work such as a novel entitles its author to make a cinematograph film in respect of the work, and to exercise the remaining rights created by section 14(1)(a) of the Act.
But once he has licensed someone to make a cinematograph film, the licensee shall have the rights provided in clauses (c) and (d) of section 14(1) of the Act in respect of the film.
We have given our earnest consideration to the submis sions made by learned counsel for the parties.
So far as the first part of the question reproduced above is con cerned, there is no dispute between the parties.
Both sides are agreed that in view of the provisions of section 18 of the Act, the material portion of which lays down that "(1) the owner of the copyright in an existing work or the prospective owner of the copyright in a future work may assign to any person the copyright either wholly or partial ly and either generally or subject to limitations and either for the whole term of the copyright or any part thereof; provided that in the case of the assignment of copyright in any future work, the assignment shall take effect only when the work comes into existence, (2)where the assignee of a copyright becomes entitled to any right comprised in the copyright, the assignee as respects the rights so assigned, and the assignor as respects the rights not assigned, shall be treated for the purposes of this Act as the owner of copyright and the provisions of this Act shall have effect accordingly", the first part of the question should be answered in the affirmative.
It is accordingly held that an existing and future right of music . composer and lyricist in their respective 'works ' as defined in the Act is capable of assignment subject to the conditions mentioned in section 18 of the Act, as also in section 19 of the Act which requires an assignment to be in writing, signed by the assignor or by his duly authorised agent.
It is the second part of the question which has been a hot bed of controversy between the parties that has got to be tackled.
The main point for determination in regard to this part of the question is whether the composer of lyric or musical work (which in terms of section 2(p) of the Act means only a notationally written, printed or graphically produced or reproduced music) retains a copyright in the lyric or musical work if he grants a licence or permission to an author (owner) of a cinematograph film for its incor poration in the sound track of a cinematograph film.
For a proper appreciation and determination of the contentions raised before us, it is necessary to notice certain provi sions of the Act.
The terms 'author ', 'Cinematograph film ', 'exclusive licence ', 'infringing copy ', 'musical work ', 'performance ' performing rights society ', 'radio diffusion ' and 'work ' are defined in clauses (d), (f), (j), (m), (p), (q), (r), (v) and (y) respectively of section 2 of the Act as under : "(d) author means, (i) in relation to a literary or dramatic work, the author of the work; 5 240SC I / 7 7 216 (ii) in relation to a musical work, the com poser; (iii) ** ** ** (iv) ** ** ** (v) in relation to a cinematograph film, the owner of the film at the time of its comple tion; and (vi) in relation to a record, the owner of the original plate from which the record is made, at the time of the making of the plate".
"(f) cinematograph film includes the sound track, if any, and "cinematograph" shall be construed as including any work produced by any process analogous to cinematography." "(j) exclusive licence means a licence which confers on the licensee or on the licen see and persons authorised by him.
to the exclusion of all other persons (including the owner of the copyright), any right comprised in the copyright in a work, and "exclusive licensee" shall be construed accordingly." "(m) infringing copy means, (i) in relation to a literary, dramatic, musical or artistic work, a reproduction thereof otherwise than in the form of a cinematograph film; (ii) in relation to a cinematograph film, a copy of the film or a record embodying the recording in any part of the sound track associated with the film; (iii) ** ** ** (iv) ** ** **" "(p) musical work means any combination of melody and harmony or either of them, printed, reduced to writing or otherwise graphically produced or reproduced". "(q) performance includes any mode of visual or acoustic presentation including any such presentation by the exhibition of a cinematograph film, or by means of radiodif fusion, or by the use of a record, or by any other means and, in relation to a lecture, includes the delivery of such lecture". "(r) performing rights society means a society, association or other body, whether incorporated or not, which carries on business in India of issuing or granting licences for the performance in India of any works in which copyright subsists".
217 (v) radio diffusion includes communication to the public by any means of wireless diffu sion whether in the form of sounds or visual images or both".
"(y) work means any of the following works, namely (i) aliterary, dramatic, musical or artistic work; (ii) a cinematograph film; (iii) a record".
Section 13 of the Act provides as follows : "13.
Works in which copyright subsists. (1) Subject to the provisions of this section and the other provisions of this Act, copyright shall subsist throughout India in the following classes of works, that is to say, (a) original literary, dramatic musical and artistic works; (b) cinematograph films; and (c) records.
(2) ** ** ** (3) Copyright shall not subsist (a) in any cinematograph film if a substantial part of the film is an infringement of the copyright in any other work; (b) in any record made in respect of a liter ary, dramatic or musical work, if in making the record, copyright in such work has been infringed.
(4) The copyright in a cinematograph film or a record shall not affect the separate copyright in any work in respect of which or a substantial part of which, the film, or as the case may be, the record is made.
(5) ** ** ** Section 14 of the Act which contains the meaning of the expression "copyright" is to the following effect : "14.
Meaning of copyright.
" (1) For the purposes of this Act: "copyright" means the exclusive right, by virtue of, and subject to the provisions of, this Act, (a) in the case of literary, dramatic or musical work, to do and authorise the doing of any of the following acts, namely (i) to reproduce the work in any material form; (ii) to publish the work; (iii) to perform the work in public; 218 (iv) to produce, reproduce, perform or publish any translation of the work; (v) to make any cinematograph film or a record in respect of the work; (vi) to communicate the work by radio diffu sion or to communicate to the public by a loud speaker or any other similar instrument the radio diffusion of the work; (vii) to make any adaptation of the work; (viii) to do in relation to a translation or an adaptation of the work any of the acts specified in relation to the work in clauses (i) to (vi): (b) ** ** ** (c) in the case of a cinematograph film, to do or authorise the doing of any of the following acts, namely (i) to make a copy of the film; (ii) to cause the film, in so far as it con sists of visual images, to be seen in public and, in so far as it consists of sounds, to be heard in public; (iii) to make any record embodying the record ing in any part of the sound track associated with the film by utilising such sound track; (iv) to communicate the film by radio diffu sion; (d) in the case of a record, to do or authorise the doing of any of the following acts by utilising the record, namely (i) to make any other record embodying the same recording; (ii) to cause the recording embodied in the record to be heard in public; (iii) to communicate the recording embodied in the record by radio diffusion.
(2) Any reference in sub section (1) to the doing of any act in relation to a work or a translation or an adaptation thereof shall include a reference to the doing or that act in relation to a substantial part thereof".
Section 17 of the Act which relates to ownership of copyright provides as under : "17.
First owner of copyright.
Subject to the provisions of this Act, the author of a work shall be the first owner of the copyright therein; Provided that 219 (a) in the case of a literary, dramatic or artistic work made by the author in the course of his employment by the proprietor of a newspaper, magazine or similar periodical under a contract of service or apprenticeship, for the purpose of publication in a newspaper, magazine or similar periodical, the said proprietor shall, in the absence of any agree ment to the contrary.
be the first owner of the copyright in the work in so far as the copyright relates to the publication of the work in any newspaper, magazine or similar periodical, or to the reproduction of the work for the purpose of its being so published, but in all other respects the author shall be the first owner of the copyright in the work; (b) Subject to the provisions of clause (a), in the case of a photograph taken, or a paint ing or portrait drawn, or an engraving or a cinematograph film made.
for valuable consid eration at the instance of any person, such person shall, in the absence of any agreement to the contrary, be the first owner of the copyright therein; (c) in the case of a work made in the course of the author 's employment under a contract of service or apprenticeship, to which clause (a) or clause (b) does not apply, the employer shall, in the absence of any agreement to the contrary, be the first owner of the copyright therein; (d) ** ** ** (e) ** ** ** Sections 22 and 26 of the Act which deal with the term of copyright in musical and other works and cinematograph films are to the following effect : "22.
Term of copyright in published liter ary, dramatic musical and artistic works.
Except as otherwise hereinafter pro vided, copyright shall subsist in any liter ary, dramatic, musical or artistic work (other than a photograph) published within the life time of the author until fifty years from the beginning of the calendar year following the year in which the author dies.
Explanation.
In this section, the refer ence to the author shall, in the case of a work of Joint authorship, be construed as a reference to the author who dies last .
Term of copyright in cinematograph films.
In the case of a cinematograph film, copyright shall subsist until fifty years from the beginning of the calendar year next fol lowing the year in which the film is pub lished".
220 Section 30 of the Act which deals with grant of licences by owners of copyright runs thus : "30.
Licences by owners of copyright.
The owner of the copyright in any existing work or the prospective owner of the copyright in any future work may grant any interest in the right by licence in writing signed by him or by his duly authorised agent: Provided that in the case of a licence relating to copyright in any future work, the licence shall take effect only when the work comes into existence.
Explanation.
When a person to whom a licence relating to copyright in any future work is granted under this section dies before the work comes into existence, his legal representatives shall, in the absence of any provision to the contrary in the licence, is entitled to the benefit of the licence".
The interpretation clause (f) of section 2 reproduced above, which is not exhaustive, leaves no room for doubt when read in conjunction with section 14(1)(c)(iii) that the term "cinematograph film" includes a sound track associated with the film.
In the light of these provisions, it cannot be disputed that a "cinematograph film" is to be taken to include the sounds embodied in a sound track which is asso ciated with the film.
Section 13 recognises 'cinematograph film ' as a distinct and separate class of 'work ' and de clares that copyright shall subsist therein throughout India.
Section 14 which enumerates the fights that subsist in various classes of works mentioned in section 13 provides that copyright in case of a literary or musical work means inter alia (a) the right to perform or cause the performance of the work in public and (b) to make or authorise the making of a cinematograph film or a record in respect of the work.
It also provides that copyright in case of cinemato graph film means.
among other rights, the right of exhibit ing or causing the exhibition m public of the cinematograph film i.e. of causing the film in so far as it consists of visual images to be seen in public and in so far it consists of sounds to be heard in public.
Section 13(4) on which Mr. Ashok Sen has leaned heavily in support of his contentions lays down that the copyright in a cinematograph film or a record shall not affect the separate copyright in any work in respect of which or a substantial part of which, the film, or as the case may be, the record is made.
Though a conflict may at first sight seem to exist between section 13(4) and section 14(1) (a) (iii) on the one hand and sec tion 14(1) (c) (ii) on the other, a close scrutiny and a harmonious and rational instead of a mechanical construction of the said provisions cannot but lead to the irresistible conclusion that once the author of a lyric or a musical work parts with a portion of his copyright by authorising a film producer to make a cinematograph film in respect of his work and thereby to have, his work incorporated or recorded on the sound track of a cinematograph film, the latter acquires by virtue of section 14(1) '(e) of the Act on completion of the cinematograph film a copyright which gives 221 him the exclusive right inter alia of performing the work in public i.e. to cause the film in so far as it consists of visual images to be seen in public and in so far as it consists of the acoustic portion including a lyric or a musical work to be heard in public without securing any further permission of the author (composer) of the lyric or a musical work for the performance of the work in pub lic.
In other words, a distinct copyright in the aforesaid circumstances comes to vest in the cinematograph film as a whole which in the words of British Copyright Committee set up in 1951 relates both to copying the film and to its performance in public.
Thus if an author (composer) of a lyric or musical work authorises a cinematograph film pro ducer to make a cinematograph film of his composition by recording it on the sound track of a cinematograph film, he cannot complain of the infringement of his copyright if the author (owner) of the cinematograph film causes the lyric or musical work recorded on the sound track of the film to be heard in public and nothing contained in section 13(4) of the Act on which Mr. Ashok Sen has strongly relied can operate to affect the rights acquired by the author (owner) of the film by virtue of section 14(1)(c) of the Act.
The composer of a lyric or a musical work, however, retains the right of performing it in public for profit otherwise than as a part of the cinematograph film and he cannot be re strained from doing so.
In other words, the author (com poser) of lyric or musical work who has authorised a cinematograph film producer to.
make a cinematograph film of his work and has thereby permitted him to appropri ate his work by incorporating or recording it on the sound track of a cinematograph film cannot restrain the author (owner) of the film from causing the acoustic portion of the film to be performed or projected or screened in public for profit or from making any record embodying the recording in any part of the sound track associated with the film by utilising such sound track or from communicating or authorising the communication of the film by radio diffu sion, as section 14(1)(c) of the Act expressly permits the owner of the copyright of the cinematograph film to do all these things.
In such cases, the author (owner) of the cinematograph film cannot be said to wrongfully appropriate anything which belongs to the composer of the lyric or musical work.
Any other construction would not only render the express provisions of clauses (f), (m), (y) of section 2, section 13(1)(b) and section 14(1)(c) of the Act otiose but would also defeat the intention of the Legislature, which in view of the growing importance of the cinemato graph film as a powerful media of expression, and the highly complex technical and scientific process and heavy capital outlay involved in its production, has sought to recognise it as a separate entity and to treat a record embodying the recording in any part of the sound track associated with the film by utilising such sound track as something distinct from a record as ordinarily understood.
On a conspectus of the scheme of the Act as disclosed in the provisions reproduced above particularly clauses (d)(v), (f) (m), (v)and (y) of section 2, sections 13(1) and 14(1)(c), provisos (b)and (c) to section 17 and sections 22 and 26 of the Act, it is, therefore, abundantly clear that a protectable copyright (comprising a 222 bundle of exclusive rights mentioned in section 14(1)(c) of the Act) comes to vest in a cinematograph film on its com pletion which is said to take place when the visual portion and audible portion are synchronized.
This takes us to the core of the question namely, wheth er the producer of a cinematograph film can defeat the right of the composer of music . or lyricst by engaging him.
The key to the solution of this question lies in provisos (b) and (c) to section 17 of the Act reproduced above which put the matter beyond doubt.
According to the first of these provisos viz. proviso (b) when a cinematograph film producer commissions a composer of music or a lyricst for reward or valuable consideration for the purpose of making his cinematograph film, or composing music or lyric there fore i.e. the sounds for incorporation or absorption in the sound track associated with the film, which as already indicated, are included in a cinematograph film, he becomes the first owner of the copyright therein 'and no copyright subsists in the composer of the lyric or music so composed unless there is a contract to the contrary between the composer of the lyric or music on the one hand and the producer of the cinematograph film on the other.
The same result follows according to aforesaid proviso (c) if the composer of music or lyric is employed under a contract of service or apprentice.ship to compose the work.
It is, therefore, crystal clear that the rights of a music composer or . lyricst Can be defeated by the producer of a cinemat ograph film in the manner laid down in provisos (b) and (c) of section 17 of the Act.
We are fortified in this view by the decision in Wallerstein vs Herbert (1867) Vol.
16, Law Times Reports 453, relied upon by Mr. Sachin Chaudhary where it was held that the music composed for reward by the plain tiff in pursuance of his engagement to give effect to cer tain situations in the drama entitled "Lady Andley 's Secret", which was to be put on the stage was not an inde pendent composition but was merely an accessory to and a Fart and parcel of the drama and the plaintiff did not have any right in the music.
For the foregoing reasons, we do not find any justification to interfere with the order of the High Court.
Conse quently, the appeal fails and is dismissed but in the circumstances of the case without any order as to costs.
KRISHNA IYER, J.
The judgment just delivered is on behalf of the Court, which makes this footnote, in a sense, otiose.
But I do append the abbreviated opinion solely to belight a slightly penumberal area of the law and to voice a need for legislative exploration to protect a category now left in the cold.
A cinematograph is a felicitous blend, a beautiful totality, a constellation of stars, if I may use these lovely imageries to drive home my point, slurring over the rule against mixed metaphor.
Cinema is more.
than long strips of celluloid, more than miracles in photography, more than song, dance and dialogue and indeed, more than dramatic story, exciting plot, gripping situations and marvellous acting.
But it is that 223 ensemble which is the finished product of orchestrated performance by each of the several participants, although the components may, sometimes, in themselves be elegant entities.
Copyright in a cinema film exists in law, but section 13(4) of the Act preserves the separate survival, in its individuality, of a copyright enjoyed by any 'work ' notwith standing its confluence in the film.
This persistence of the aesthetic 'personality ' of the intellectual property cannot cut down the copyright of the film qua film.
The latter right is, as explained earlier in my learned broth er 's judgment, set out indubitably in section 14(1)(c).
True, the exclusive right, otherwise called copyright, in the case of a musical work extends to all the sub rights spelt out in section 14(1)(a).
A harmonious construction of section 14, which is the integral yoga of copyrights in creative works, takes us to the soul of the subject.
The artist enjoys his copyright in the musical work, the filmproducer is the master of his combination of artistic pieces and the two can happily co exist and need not conflict.
What is the modus vivendi ? The solution is simple.
The film producer has the sole right to exercise what is his entitlement under section 14(1)(c) qua film, but he cannot trench on I the composer 's copyright which he does only if the 'music ' is performed or produced or reproduced separately, in violation of section 14(1)(a).
For instance, a film may be caused to be exhibited as a film but the pieces of music cannot be picked out of the sound track and played in the cinema or other theatre.
To do that is the privilege of the composer and that right of his is not crowned in the film copyright except where there is special provision such as in section 17, proviso (c).
So, beyond exhib iting the film as a cinema show, if the producer plays the songs separately to attract an audience or for other reason, he infringes the composer 's copyright.
Anywhere, in a restaurant or aeroplane or radio station or cinema theatre, if a music is played, there comes into play the copyright of the composer or the Performing Arts Society.
These are the boundaries of composite creations of art which are at once individual and collective, viewed from different angles.
In 'a cosmic perspective, a thing of beauty has no boundary and is humanity 's property but in the materialist plane on which artists thrive, private and exclusive estate in art subsists.
Man, the noblest work of the Infinite Artist, strangely enough, battles for the finite products of his art and the secular law, operating on the temporal level, guard ians material works possessing spiritual values.
The enig matic small of Mona, Lisa is the timeless heritage of man kind but, till liberated by the prescribed passage of time, the private copyright of the human maker says, 'hands off '.
The creative intelligence of man is displayed in multiform ways of aesthetic expression but it often happens that economic systems so operate that the priceless divinity which we call artistic or literary creativity in man is exploited and masterS, whose works are invaluable, are victims of piffling payments.
World opinion in defence of the human right to intellectual property led to internation al conventions and municipal laws, commissions, codes and organisations, calculated to protect works of article India responded to this universal need by enacting the .
224 Not the recommendations in conventions but provisions in municipal laws determine enforceable rightS. Our copyright statute protects the composite cinematograph work produced by lay out of heavy money and many talents but does not extinguish the copyrightable component parts in toto.
The music which has merged, through the sound track, into the motion picture, is copyrighted by the producer but, on account of this monopoly, the music composer 's copyright does not perish.
The twin rights can co exiSt, each ful filling itself in its delectable distinctiveness.
Section 14 has, in its careful arrangement of the rights belonging to each copyright, has a certain melody and harmony to miss which is to lose the sense of the Scheme.
A somewhat un Indian feature we noticed in the Indian copyright Act falls to be mentioned.
Of course, when ' our law is intellectual 'borrowing from British reports, as admittedly it is, such exoticism is possible. 'Musical work ', as defined in s.2 ( p) reads: "(p) musical work means any combina tion of melody and harmony or either of them printed, re duced to writing or otherwise graphically produced or reproduced." Therefore, copyrighted music is not the soulful tune, the superb singing, the glorious voice or the wonderful render ing.
It is the melody or harmony reduced to print, writing or graphic form.
The Indian music lovers throng to listen and be enthralled or enchanted by the nada brahma, the sweet concord of sounds, the rags, the bhava, the lava and the sublime or exciting singing.
Printed music is not the glamour or glory of it, by and large, although the content of the poem or the lyric or the song does have appeal.
Strangely enough, 'author ', as defined in s.2(d), in rela tion to a musical work, is only the composer and section 16 confies 'copyright ' to those works which are recognised by the Act.
This means that the composer alone has copyright in a musical work.
The singer has none.
This disentitle ment of the musician or group of musical artists to copy right is un Indian, because the major attraction which lends monetary value to a musical performance is not the music maker, so much as the musician.
Perhaps, both deserve to be recognised by the copyright law.
I make this observation only because act in one sense, depends on the ethos and the aesthetic best of a people; and while universal protection of intellectual and aesthetic property of creators of 'works ' is an international obligation, each country in its law must protect such rights wherever originality is con tributed.
So viewed, apart from the music composer, the singer must be conferred a right.
Of course, law making is the province of Parliament but the Court must communicate to the lawmaker such infirmities as exist in the law extant.
S.R. Appeal dismissed.
[/INST]The appellant society was incorporated in terms of section 2(r) of the (Act 14 of 1957), in the State of Maharashtra on August 23, 1969 as a company limited by guarantee for the purpose of carrying on business in India of issuing or granting licences for performance in public of all existing and future Indian musical works in which copyright within the meaning of section 13 subsists in India.
The appellant company has amongst its members the composers of musical works, authors of literary and dramatic works and artistes.
In accordance with the provisions of section 33 of the Copyright Act, the appellant published on September 27, 1969 and November 29, 1969 in the "Statesman" and the Gazette of India respectively a tariff laying down the fees, charges and royalties that it proposed to collect for the grant of licences for performance in public of works in respect of which it claimed to be an assignee of copy rights and to have authority to grant the aforesaid li cences.
A number of persons including various associations of producers of cinematograph films including the sound track thereof and the Cinematograph Exhibitors Association of India filed objections in respect of the tariff before the Copyright Board in accordance with the provisions of section 34 of the Act, repudiating the rights of the appel lant.
The Copyright Board held : (1) In the absence of proof to the contrary, the composers of lyrics and music retained the copyright in their musical works incorporated in the sound track of cinematograph films provided such lyrical and musical works were printed on written and that they could assign the performing right in public to the appellant.
(2) The tariff as published by the appellant was reasonable.
(3) The appellant had the right to grant li cences for the public performance of music in the sound track of copyrighted Indian cinematograph films and (4) It could collect fees, royalties and charges in respect of those films w.e.f.
the date on which the tariff was pub lished in the Gazette of India.
The High Court allowed the appeal preferred by the respondents under section 72 of the Act and held: (i) Unless there is a contract to the contrary a composer who composes a lyric or music for the first time for valuable consideration for a cinematograph film does not acquire any copyright either in respect of film or its sound track which he is capable of assigning.
(ii) Under proviso (b) to section 17 of the Act, the owner of the film at whose instance the composition is made becomes the first owner of the copyright in the composition.
(iii) The compos er can claim a copyright in his work only if there is an express agreement between him and the owner of the cinemato graph film reserving his copyright.
(iv) Though section 18 of the Act confers power to make a contract of assignment.
the power can be exercised only when there is an existing or future right to be assigned and that in the circumstances of the present case, assignment, if any, of the copyright in any future work is of no effect.
In appeal by certificate to this Court, the appellant contended (1) The author (composer) of a literary or musical work has copyright which includes.
inter alia.
the exclusive right (a) to perform the work in public and 207 (b) to make any cinematograph film or a record in respect of the work.
(2) That copyright in a literary or musical work is infringed by any person if without a licence granted to him by the owner of the copyright, he makes a cinematograph film in respect of the work or perform the work in public by exhibiting the cinematograph film.
(3) If a person desires to exhibit in public a cinematograph film containing a musical work, he has to take the per mission not only of the owner of the copyright in the cine matograph film but also the permission of the owner of the copyright in the literary or musical work which is incor porated in the cinematograph film, as according to section 13(4) of the Act, the copyright in a cinematograph film or a record does not effect the separate copyright in any work in respect of which or a substantial part of which the film or as the case may be, the record is made (4).
The provi sions of section 17(b) of the Act have no application to a literary or musical work or the separate copyright therein and do not take away the copyright in a literary or musical work embodied in a cinematograph film.
(5) The only modes in which the author of a literary work or musical work ceases to be the owner of copyright in the work are (a) by assigning under section 18(b) by relinquishment under section 21 and (c) by the composer composing the work in the course of his employment under a contract of service with an employer in which case the employer becomes the owner of the copyright in the musical work.
(6) In the case of an assignment of copyright in future work and the employment of the author to produce a work under a contract of service, the question of priorities will be decided according to the principles "where equities are equal, the first in time shall prevail".
The respondent 's contentions were (i) Unless a music is notationally written, printed or graphically reproduced it is not a musical work within the meaning of Copyright Act and there is no copyright in songs or orchestral pieces sung or played directly without its notation being written.
(ii) Since a "cinematograph film" is defined in section 2(f) of the Act as including the sound track and the "cinema tograph" is required to be construed to include any work produced by any process analogous to cinematography the owner of the cinematograph film is the first owner of the copyright therein including the right of the composer of the literary or musical work incorporated in the sound track of the film.
(iii) In the case of the film in which a lyric (which literally means a short poem directly expressing the poet 's own thoughts and sentiments in instances failing within the purview of the expression "literary work" as defined in section 2(0) of the Act has been plagiarised, there will be copyright in the film vesting in the pro ducer.
(iv) The Act confers a separate copyright of a cinematograph film as a film, its author under section 2(d)(v) of the Act being the owner of the film at the time of its completion.
(v) In the case of a lyric or music incorporat ed under the sound track of a cinematograph film, since in section 2(f) of the Act cinematograph film includes its sound track and section 13(1)(b) of the Act confers copyright on the cinematograph film and section 14(c) (ii) of the Act confers on the. owner of copyright the right to cause the film in so far as it consists of visual images to be seen in public and in so far as it consists of songs to be heard in public, it is not necessary for the owner of the cinematograph film to secure the permission of the composer of the lyric or of the music incorporated in the sound track of a cinematograph film for exhibiting or causing the exhibition of the sound portion of the film in public or for causing the records of the sound track of the film to be heard in public.
(vii) It is not correct to say that under section 17 proviso (b) in order that the producer of the cinematograph film should have copyright in the literary or musical work incorporated in it, the making of the entire film should be commissioned.
Section 17(b) will equally apply if someone is commissioned to make any compo nent part of a cinematograph film such as a lyric or musical work i.e. when such component of the film is made at the instance of a film producer for valuable consideration, the copyright for such component shall as well vest in the producer.
(viii) As the Act confers a separate copyright on a cinematograph film as a film the producer can exercise both the rights conferred on him under section 141(c)(ii) of the Act and all that section 13(4) of the Act (when applicable) provides is that the rights created by section 14(1)(a) and (b) shall coexist with those created by section 14(1)(e) and (d) of the Act.
Dismissing the appeal the Court, HELD: (Per Krishna Iyer, J. concurring) 208 (1) Copyright in a cinema film exists in law but section 13(4) of the Act preserves the separate survival in its individuality of a copyright enjoyed by any work notwith standing its confluence in the film.
This persistence of the aesthetic personality of the intellectual property cannot cut down the copyright of the film qua film.
The exclusive right, otherwise, called copyright, in the ' case of a musical work extends to all the sub rights spelt out in section 14(1) (a).
A harmonious construction, of section 14, which is the integral yoga of copyright shows that the artiste enjoys his copyright in the musical _work the film producer is the master of his combination of artistic .pieces and the two can.
happily co exist and need not conflict.
[223 A C] (2) The boundaries of composite creations of art which are at once individual and collective may be viewed from different angles.
In a cosmic perspective, a thing of beauty has no boundary and is humanity 's property but in the materialist plane on which artistes thrive private and exclusive estate inert subsists.
The enigmatic smale of Mona Lisa is the timeless heritage of mankind, but, till liberated by the prescribed passage of time, the private copy right of the human maker says, "hands off.
[223 F G] (3) The film producer has the sole right to exercise what is his entitlement under section 14(1)(c) qua film.
But, he cannot trench on the composer 's copyright which he does only if the 'music ' is performed or produced or repro duced separately, in violation of section 14(1)(a).
A film may be caused to be exhibited as a film but the pieces of music cannot be picked out of the sound track and played in the cinema or the theatre.
To do that is the privilege of the composer and that right of his is not drowned in the film ' copyright except where there is special provision such as section 17, proviso (c).
Beyond exhibiting the film as a cinema show if the producer plays the songs separately to attract an audience or for other reasons he infringes the composer 's copyright, the copyright of the composer or the Performing Acts Society comes into play, if a music is played, whether in a restaurant or aeroplane or radio sta tion or cinema theatre.
[223 C E] (4) Section 14 has in its careful arrangement of the right belonging each copyright has a certain melody and harmony to music which is to loose the sense of the same.
Our copyright statute protects the composite cinematograph work produced by lay out of heavy money and many talents but does not extinguish the copyrightable component parts in toto.
The music which has merged through the sound track, into the motion picture is copyright by the producer but, on account of this monopoly, the music composer 's copyright does not perish.
The twin rights can co exist each fulfil ing itself in its delectable distinctiveness.
[224 A B] Observation: Apart from the music composed, the singer must be conferred a right.
Copyrighted music is not the soulful tune, the superb singing, the glorious voice or the wonder ful rendering.
It is the melody or harmony reduced to print writing or graphic form of musical works.
Author as defined in s.2(d) in relation to a musical work is only the composer and section 16 confines copyright to those works which are recognised by the Act, which means the composer alone has copyright in a musical work and the singer has none.
This disentitlement of the musician or group of musical artistes to copyright is un Indian because the major attraction which lends monetary value to a musical performance is not the music maker so much as the musician.
Perhaps both deserve to be recognised by the copyright law, because art in one sense depends on the ethos and the aesthetic best of a people and while universal protection of intellectual and aesthetic property of creators of "works" is an international obliga tion each country in its law must protect such rights wher ever originally is contributed.
[224 E H] Per Jaswant Singh J. (1) The existing and future right of music . . composer and lyrics in their respective works as defined in the Act is capable of assignment subject to the conditions mentioned in section 18 of the Act as also in section 209 19 of the Act which requires an assignment to be in writing, signed by the assigner or by his duly authorised agent.
[215 D E] (2) The interpretation of clause (f) of section 2 which is not exhaustive leaves no room for doubt when read in conjunction with section 14(1)(c)(iii), that the term cine matograph film includes a sound track associated with the film.
[220 D] (3) A harmonious and rational instead of mechanical construction of section 34, section 14(1)(a)(iii) and section 14(1)(c)(ii) will be: (A) Once the author of a lyric or a musical work parts with a portion of his copyright by authorising a film pro ducer to make a cinematograph film in respect of his work and thereby to have his work incorporated or recorded in sound track of a cinematograph film, the latter.acquires by virtue of section 14(1)(c) of the Act on completion of the cinematograph film a copyright which gives him the exclu sive right, inter alma, of performing the work in public that is, to cause the film in so far as it consists of visual images to be seen in public and in so far as it consists of the acoustic portion including a lyric or a musical work to be heard in public without securing any further permission of the author (composer) of the lyric or a musical work for the performance of the work in public.
A distinct copyright in the aforesaid circumstances comes to vest in the cinematograph film as a whole which relates both to copying the film and to its performance in public.
(B) If an author (composer) of a lyric or a musical work authorises a cinematograph film producer to make a cinematograph film of his composition by recording it on the sound track or a cinematograph film, he cannot complain of the infringement of his copyright if the author (owner) of the cinematograph film causes the lyric or the musical work recorded on the sound track of the film to be heard in public and nothing contained in section 13(4) of the Act can operate to affect the rights acquired by the author (owner) of the film by virtue of section 14(1)(c) of the Act.
(C) The composer of a lyric or musical work retains the right of performing it in public for profit otherwise than as a part of cinematograph film and he cannot be restrained from doing so.
In other words, the author (composer) of a lyric or musical work who has authorised a cinematograph film producer to make a cinematograph film of his work and thereby permitted him to appropriate his work by incorporating or recording it on the sound track of a cinematograph film cannot restrain the author (owner) of the film from causing the acoustic portion of the film to be performed or projected or screened in public for profit or from making any record embodying the recording in any part of the sound track associated with the film by utilising such sound track or from communicating or authorising the communication of the film by radio diffusion, as section 14(1)(c) of the Act expressly permits the owner of the copyright of a cinematograph film to do all these things.
In such cases the author (owner) of the cinematograph film cannot be said to wrongfully appropriate anything which belongs to the composer of the lyric or musical work.
Any other construction would not only render the ex press provisions of clause (f), (m), (y) of section 2, section 13(1)(b) ,red section 14(1)(c) of the Act otiose but would also defeat the intention of the legislature which in view of the growing importance of the cinematograph film as a powerful media of expression and the highly complex, technical and scientific process and heavy capital outlay involved in its production has sought to recognise as a separate entity and to treat a record embodying the record ing in any part of the sound track associated with the film by utilising such sound track as something distinct from a record as ordinarily understood.
[220 G H; 221 A G] (4)Clauses (d), (v), (f), (m), (v) and (y) of section 2, section 13(1) and 14(1)(c), provisos (b) and (c) to section 17 and section 22 and 26 of the Act abundantly make it clear that protectable copyright (comprising a bundle of exclusive rights mentioned in section 14(1)(c) of the Act comes to 210 vest in a cinematograph film on its completion which is said to take place when the visual portion and audible portion are synchronized.
[221 H; 222 A] (5) The rights of music . . composer or lyricist can be defeated by the producer of a cinematograph film in the manner laid down in proviso (b) and (c) of section 17 of the Act.
In both the.
cases falling under clauses (b) and (c) of section 17, a cinematograph film producer becomes the.
first owner of the copyright and no copyright subsists in the composer of the lyric or music so composed unless there is a contract to the contrary between the composer of the lyric or music on one hand and the producer of the cinemato graph film on the other.
[222 D F] Wallerstein vs Herbert (1867) Vol.
16, Law Times Reports 453, quoted with approval.
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<s>[INST] Summarize the judgementCivil Appeal Nos. 814 and 815 of 1974 From the Judgment and Order dated 13.
8. 1970 of the High Court of Allahabad in Special Appeal No. 34 of 1969 D section N. Kackar, Gopal Subramaniam and Mrs. Shobha Dikshit for the Appellant in CA.
No. 814 and respondent in CA No. 815.
U. R. Lalit and B. section Chauhan for the Respondent in CA.
No. 814 and Appellant in CA.
No. 815.
E The Judgment of the Court was delivered by VENKATARAMIAH, J.
These two appeals by special leave are filed against the judgment dated August 13, 1970 of the High Court of Allahabad in Special Appeal No. 34 of 1964 (City Board, Mussoorie v State Electricity Board & Ors.)(1) by the Uttar Pradesh Electricity Board (hereinafter referred to as the Electricity Board ') Constituted under the (hereinafter referred to as 'the Act ') and the City Board, Mussoorie, a local authority (hereinafter referred to as 'the City Board ') respectively.
The City Board as a licensee under the used to get bulk supply of electric energy from the Electricity Board from the Ganga Sarda Grid and in its turn was distributing it to the consumers within its jurisdiction.
In the year 1962, under a (1) A.l.R. 1971 Allahabad 219. 818 notification dated April 24, 1962 issued under section 46 of the Act, the tariff payable by the City Board and other licensees in the Ganga Sarda Grid was fixed by the Electricity Board.
The relevant portion of the Tariff was as follows: "1.
Applicability This rate schedule is applicable to all licensees situated in Ganga Sarda Grid area and taking supply in bulk from the Board.
Character of service A. C., 3, Phase, 50 cycles, 11,000 volts, Alternatively, the supply can be given at a voltage lower than 11 KV in which case an additional charge at 7. 1/2 per cent on the total amount of the bill will be levied.
If the consumer takes supply at a standard voltage above 11 KV, a rebate of 5% will be allowed to him by the Board on the total amount of the bill calculated at the rates prescribed for supply at KV.
Rate; (a) Demand Charges First 500 KVA of Chargeable demand during the month at the rate of. . . .
Rs. 12.75 per KVA Neat 1500 KVA of the charge demand during the month at the rate of . . . .
Rs. 10.00 per KVa All above 2000 KVA of the chargeable demand during the month at the rate of. .
Rs. 8.50 per KVA PLUS (b) Energy Charges First 170 Kwh, per KVA of Chargeable demand consumed during the month at the rate of. ". . 5P. per Kwh 819 Next 170 Kwh.
per KVA of chargeable demand consumed during the month at the rate of. . . 4P. per Kwh.
Remaining Kwh.
per KVA of the chargeable demand consumed during the month at the rate of. . . 3P. per KWh 4.
(i)Chargeable Demand The chargeable demand for the month shall be defined as the actual demand during the month or 60 per cent of the contracted demand or 75 per cent of the highest demand which occurred during the preceding 11 months, whichever is the highest.
(ii) Coal Clause The above rates shall be subject to a coal price adjustment at the rate of 0.001 per Kwh.
increase or decrease for every one P. Of variation above or below Rs. 40 per tonne of coal delivered at the bunkers in the Harduaganj Generating Station 5.
Determination of Demand: Demand measurement shall be made by suitable instruments at the point of deli very.
The demand for any month shall be defined at the highest average load measured in Kilovolt amperes during any 30 consecutive minutes period of the month.
" The tariff so fixed was enhanced by another notification dated September 30, 1967 by twenty per cent and the enhanced rate come into force on December 1, 1967.
Under section 58 of the Act, the Electricity Board or where no such Board was constituted, the State Government had the power to direct the amortisation and tariffs policies of any licensee, being a local authority, with respect to its licensed undertaking in such manner as the Electricity Board or the State Government, as the case may be, after giving the local authority a reasonable opportunity of being heard, considered expedient for the purposes of the Act.
The licensee, being a local authority, the provisions of any other law or of any rules made or directions given thereunder notwithstanding, was bound to give effect to any such directions of the Electricity Board, or the State Government, as the case may be.
The Electricity Board however, could not issue any directions under section 58 of the Act except after obtaining the prior approval of the State Government.
The City Board had H 820 moved the State Government on September 13, 1966 for permission to enhance the rates for supply of electric energy to Consumers.
No such sanction was given till March 23, 1968.
The City Board, therefore, filed a petition under Article 226 of the Constitution questioning the validity of the tariff fixed under the notification dated April 24, 1962 and the enhancement made under the notification dated September 30, 1967 It may, however, be stated here that subsequently on April 20, 1968, the City Board was permitted to raise the charges for light and fan by two paise per unit which came to 6% or 7% of the original rates and by 10% for electric energy supplied for other purposes.
The City Board challenged the notification issued on April 24, 1962 on the ground that it was not in conformity with section 46 of the Act.
It questioned the enhancement made on September 30, 1967 on the ground that it had not been permitted to enhance correspondingly the rates chargeable by it to the consumers even though in its vicinity the Electricity Board itself was supplying electric energy to consumers at a much higher rate.
The petition was contested by the Electricity Board.
The Writ Petition was heard by a Single Judge of the High Court.
He dismissed the petition.
The City Board, thereafter filed an appeal before the Division Bench of the High Court.
The Division Bench allowed the appeal in part.
Aggrieved by the judgment of the Division Bench, the City Board and the Electricity Board have filed the above appeals by special leave.
The material part of section 46 of the Act reads thus: "46.
(1) A tariff to be known as the Grid Tariff shall in accordance with any regulations made in this behalf, be fixed from time to time by the Board in respect of each area for which a scheme is in force, and tariffs fixed under this section may, if the Board thinks fit, differ for different areas.
(2) Without prejudice to the provisions of section 47, the Grid Tariff shall apply to sales of electricity by the Board to licensees where so required under any of the First, Second and Third Schedules, and shall, subject as herein 821 after provided, also be applicable to sales of electricity by the Board to licensees in other cases: Provided that if in any such other case it appears to the Board that, having regard to the extent of the supply required, the transmission expenses involved in affording the supply are higher than those allowed in fixing the Grid Tariff, the Board may make such additional charges as it considers appropriate,. . . " The first contention urged before us by the City Board is that in the absence of any regulations framed by the Electricity Board under section 79 of the Act regarding the principles governing the fixing of Grid Tariffs, it was not open to the Electricity Board to issue the impugned notifications.
This contention is based on subsection (1) of section 46 of the Act which provides that a tariff to be known as the Grid Tariff shall in accordance with any regulations made in this behalf, be fixed from time to time by the Electricity Board.
It is urged that in the absence of any regulations laying down the principles for fixing the tariff, the impugned notifications were void as they had been issued without any guidelines and were,.
therefore, arbitrary.
It is admitted that no such regulations had been made by the Electricity Board by the time the impugned notifications were issued.
The Division Bench has negatived the above plea and according to us, rightly.
It is true that section 79 (h) of the Act authorises the Electricity Board to make regulations laying down the principles governing the fixing of Grid Tariffs.
But section 46 (1) of the Act does not say that no Grid Tariff can be fixed until such regulations are made.
It only provides that the Grid Tariff shall be in accordance with any regulations, made in this behalf.
That means that if there were any regulations the Grid Tariff should be fixed in accordance with such regulations and nothing more.
We are of the view that the framing of regulations under section 79 (h) of the Act cannot be a condition precedent for fixing the Grid Tariff.
A similar contention was rejected by this Court in Mysore State Road Transport Corporation vs Gopinath Gundachar Char(l) which was a case arising under the Road Transport Corporation Act, 1950.
Under section 14 of that Act a Road Transport Corporation was entitled to appoint officers and servants as it considered necessary for the efficient performance of its sanctions.
Under section 34 (1) of the Road Transport Corporation Act, 1950 (1) [19681 1 S.C.R. 767, 822 the State Government had been empowered inter alia to issue directions to the Road Transport Corporation regarding recruitment, conditions of service and training of its employees.
Under section 45 (2) (c) of that Act, the Road Transport Corporation was empowered to make regulations regarding the conditions of appointment and service and the scales of pay of officers and servants of the Corporation other than the Chief Executive Officer, General manager and the Chief Accounts Officer.
Admittedly no regulations had been framed under section 45 (2) (c) of that Act.
It was contended that the Corporation could not appoint officers and servants referred to therein or make any provision regarding their conditions of service until such regulations were made.
This Court rejected the said plea with the following observation at page 770: "The conjoint effect.
Of sections 14 (3) (b), 34 and 45 (2) (c) is that the appointment of officers and servants and their conditions of service must conform to the directions, if any given by the State Government under section 34 and the regulations, if any, framed under section 45 (2) (c).
But until such regulations are framed or directions are given, the Corporation may appoint such officers or servants as may be necessary for the efficient performance of its duties on such terms and conditions as it thinks fit.
" We do not also find any merit in the submission that the Grid Tariff fixed in this case suffered from the vice of arbitrariness.
As observed by the Division Bench of the High Court, there is ample guidance available in the various provisions of the Act and that the rates fixed are subject to the control of the State Government.
We do not find it necessary to repeat what is stated by the Division Bench except observing that we respectfully agree with the reasons given by it for rejecting the said plea.
In Maharashtra State Electricity Board vs Kalyan Borough Municipality & Anr.
,(l) this Court has discussed the relevant provisions of the Act while dealing with section 49 thereof which show that the Act furnishes ample guidance generally regarding the determination of tariffs by an Electricity Board functioning under the Act.
There is also no merit in the submission that there cannot be a common tariff for all licensees in an area served by a Grid and that there should be a separate rate (1) ; 823 of charge for each licensee.
While it may not be objectionable to have a reasonable tariff fixed in the case of a particular licensee without offending the rule of non discrimination, fixation of a common Grid Tariff is in consonance with the spirit of the Act.
The preamble to the Act says that it had been enacted to provide for the rationalisation of the production and supply of electricity and generally for taking measures conducive to electrical development.
Looked at against this background, it is permissible for the ElectriCity Board to fix a common Grid Tariff for an area so that there may be a reasonably uniform development of the area by the supply of electric energy to all licensees or consumers in the area at a uniform rate with such reasonable variations as may be permissible in law subject to the condition that no undue preference is shown to any of them.
The Division Bench, however, held that the levy of an additional 7.1/2% as an additional charge made by the Electricity Board under the first para of clause (2) of the impugned notifications dated April 24, 1962 and September 30, ]967 was illegal and therefore liable to be quashed because according to it the additional charge of 7.1/2% could be imposed under the proviso to section 46 (2) of the Act to cover extra expenses only and not for supplying electric ENERGY at a lower voltage of 6600 volts when the Grid Tariff had fixed rates for supplying electric energy at 11000 volts.
It however, held that it was open to the Electricity Board to make an additional charge only to the extent of the actual expenditure incurred by supplying electric energy at 6600 volts.
It also quashed the Government order dated April 20, 1968 by which the City Board was permitted to increase the charges payable by the consumers in some respects and the subsequent action taken on the above basis.
The Division Bench directed the respondents to consider afresh the question of the rates at which electric energy could be supplied.
We do not propose to go into the correctness of this part of the decision of the Division Bench because we are of the view that this case can be dispensed of in a different way.
The contention relating to the validity of the levy of additional charges could not be raised by the City Board under Article 226 of the Constitution in respect of the period prior to the filing of the writ petition.
The above additional charge of 7.1/2% was levied in 1962 and the City Board did not question it before the Court till March 23, 1968 when it filed the writ petition.
It is further seen that it has not stated that it had not collected charges from the consumers of electric energy supplied by it at the 824 rates which would cover the additional 7.112%.
The learned counsel for the City Board was not able to state that the City Board had not recouped itself by collecting the charges from the consumers.
In this situation we have to presume that the City Board had not suffered any loss by the levy of 7.1/2 % by way of additional charges.
We are of the view that in cases of this nature where there is little or no possibility of refunding the excess amount collected from the ultimate consumer to him and the granting of the relief to the petitioner would result in his unjust enrichment, the Court should not ordinarily direct any refund in exercise of its discretion under Article 226 of the Constitution Moreover in this case the City Board woke up nearly 6 years after the issue of the first notification and that too only after an enhancement by 20% was made under the second notification.
In the case of the City Board, which is a local authority, there is an additional reason.
Under section 58 of the Act which is already referred to above a local authority is bound to implement the directions issued by the Electricity Board or the Government, as the case may be, with regard to the amortisation and tariffs policies.
The City Board has been given directions from time to time by the Government regarding the charges it may collect from the consumers in the light of the charges it has to pay to the Electricity Board and its own investment and expenditure on the undertaking.
The City Board cannot question the Grid Tariff only without at the same time questioning the directions pursuant to which it has been collecting charges from its consumers.
No satisfactory material is placed before the Court showing that the charges which were being collected by the City Board from the consumers were uneconomical and did not satisfy the reasonable standards which should govern the directions issued by the Electricity Board or the Government from time to time regarding the tariffs policies of the City Board.
In this situation, we feel that it would not be proper to reopen the claims of the City Board in regard to the period prior to the filing of the writ petition arising on the basis of the alleged invalidity of the notification dated April 24, 1962.
Hence we refuse to grant any relief in this regard to the City Board for the period up to the date of the writ petition, that is, till March 23, 1968.
The Grid Tariff was revised in this case on July 1, 1968.
The decision of the High Court on the above point is, however, allowed to re[remain only for the period between March 23, 1968 and July 1, 1968 without expressing any opinion on its correctness because the period is a small one and the Electricity Board does not insist upon a decision on this question in this case.
The question is left open by 825 us.
Similarly, the relief granted by the High Court with regard to A the levy of additional charge of 2 % with effect from December 1, 1967 till July 1, 1968 is not disturbed by us for the same reason without expressing any opinion on its correctness.
This judgment shall not be construed as affirming the decision of the High Court in so far as the above points are concerned.
The matter may be reconsidered by the Electricity Board as directed by the Division Bench of the High Court but with regard to the periods specified above.
The appeals are accordingly disposed of.
There shall be no order as to costs.
[/INST]The appellant Corporation levied licence fee for use of premises and land for soaking coconut husks under Schedule IV of the Calicut City Municipal Act 1961, Subsequently restyled as the Kerala Municipal Corporation Act 1961.
The respondents were carrying on the trade of soaking coconut husks, and as they had not taken out the requisite licence, the Commissioner of the Corporation issued notices to show cause why they should not be prosecuted.
The respondents challenged the validity and legality of the notices in Writ Petitions to the High Court, contending that if the licence fee is levied as a fee, no service is rendered or special advantage or favour is conferred by the Corporation for collecting such fee and that there is DO quid pro quo and that the relevant provisions of the Act do not enable the Corporation to levy such a fee.
It was further contended that if the levy is treated is a tax, it is beyond the taxing powers of the Corporation.
The Corporation contested the Writ Petitions justifying the fee as licence fee and that it had the power to levy a tax of the nature levied by it.
A Single Judge of the High Court allowed the Writ Petitions, and quashed the impugned licence fee as not legal in the absence of conferment of special benefits in respect of persons who soak coconut husks.
It was further held that the power to levy the various taxes conferred on the Corporation under Chapter V of the 1961 Act did not comprehend the impugned levy and consequently the tax was not valid and legal.
The writ appeals of the Corporation were dismissed.
1009 Allowing the Appeals, this Court ^ HELD: By numerous recent decisions of this Court it is well settled that the traditional concept in a fee of quid pro quo is undergoing a transformation and that though the fee must have relation to the services rendered or the advantages conferred, such relation need not be direct, a mere casual relation may be enough.
It is not necessary to establish that those who pay the fee must receive direct benefit of the services tendered for which the fee is being paid.
If one who is liable to pay receives general benefit from the authority levying the fee the element of service required for collecting fee is satisfied.
It is not necessary that the persons liable to pay must receive some special benefit or advantage for payment of the fee.
[1012E F] In the instant case, it is incontrovertible that the appellant Corporation is rendering numerous services to the persons within its areas of operation and that therefore the levy of the licence fee as fee is fully justified.
Soaking coconut husks emit foul odour and contaminates environment.
The Corporation by rendering scavanging services, carrying on operations for cleanliness of the city, to make habitation tolerable is rendering general service of which amongst others respondents are beneficiaries.
a The decisions of the Single Judge and of the Division Bench are set aside and the Writ Petitions of the respondents are dismissed.
[1012 G H] Municipal Corporation of Delhi & Ors.
vs Mohd. Yasin Others vs State of Andhra Pradesh and Others ; & M/s Amarnath Om Prakash and Others vs State of Punjab & Ors.
(1985) I SCC 345 referred to.
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<s>[INST] Summarize the judgementCivil Appeal No. 56 of 1971.
From the Judgment and Order dated 8.12.1969 of the Gujarat High Court in C.R.A. No. 654 of 1967.
Harish Salve, D.N. Misra and Ms. A.K. Verma for the Appellant.
S.H. Sheth and Ms. Kailash Mehta for Respondent No. 1.
M.V. Goswami and Ms. Vandana Sharma for Respondent No.2.
The Judgment of the Court was delivered by MISRA, J.
The present appeal by special leave is directed against the Judgment of the High Court of Gujarat dated 10th February 1970.
The dispute between the parties concerns a plot of land admeasuring 100 ft.
x 164 ft.
(i.e., approximately 1822 sq. yards) out of survey No. 18 in the city of Nadiad.
This plot was owned by Deviprasad Motilal Jaiswal and Vora Sunderlal Manilal was occupying it as a tenant.
He had also made certain constructions on the disputed plot.
The appellant purchased the said plot under a registered sale deed dated 18th April, 1955.
The defendant accepted the plaintiff as owner on a rent of Rs. 1325 721 per annum with effect from 18th April, 1955 under a registered rent note dated 9th June, 1955 for a period of five years.
The rent note provided (1) that the defendant shall pay to the plaintiff the amount of municipal tax at the rate of Rs. 40 per annum in respect of the rented premises, (2) that the said premises shall not be let out to anyone else, and (3) that on the expiry of the period of five years the defendant shall remove the constructions at his own expense and hand over to the plaintiff the premises in the condition in which it was let out.
It appears that the defendant No. 1 sublet a portion of the said premises to defendant No. 2, Pa Babubhai Gordhanbhai contrary to the terms of the rent note.
The period of lease contemplated in the rent note expired on 17th April, 1960 and the defendant continued as a statutory tenant on a monthly rent under the Rent Control Act.
The two sons of the plaintiff Suleman and Ganibhai are dealing in empty tins on a large scale and a spacious premises was required for the said business.
The plaintiff called upon the defendant to remove the construction erected on the land in dispute and to vacate the premises and handover the possession.
Although the plaintiff filed the suit for eviction on a number of grounds, we are concerned in the present appeal only with the plea that the premises in question had not been used by the defendant for a period of more than six months prior to the date of the suit without reasonable cause I and, therefore, the defendant was liable to eviction under s.13(1)(k) of the Bombay Rents, Hotel and Lodging House Rates (Control) Act, 1947, hereinafter referred to as the Act.
The trial court dismissed the suit holding that the notice of termination was not valid and that the plaintiff had failed to prove the bona fide requirement, and that the defendant No.2 was admitted as a sub tenant many years before the execution of the rent note by the plaintiff and, therefore, the plaintiff was not entitled to recover possession on the ground of illegal sub letting.
The plaintiff feeling aggrieved by the judgment took up the matter in appeal and the Assistant Judge allowed the appeal partly holding that the notice of termination was a valid one, that the plaintiff did not require the suit premises reasonably and bonafide for occupation for himself, and that the suit premises had not been used by the defendant continuously for a period of six months immediately preceding the date of suit with out any reasonable cause.
The defendant took up the matter in revision before the High Court and the High Court reversed the finding of the 1st appellate court on the question of user by the defendant.
It took the view that the construction of the super 722 structure on the land itself was a user and, therefore, the courts below and committed a manifest error in holding that the land in question had not been used for more than six months prior to the institution of the suit.
The plaintiff has now come to this Court by a special leave.
Mr. Harish, N. Salve counsel for the appellant strenuously urged that the tenant was liable to be evicted under s.13(1)(k) of the Act inasmuch as the premises have not been used for the purpose for which they were let out for a continuous period of six months immediately preceding the date of suit without reasonable cause.
He also contended that the defendant would be liable to eviction even if he did not use the premises and kept it locked.
Mr. S.H. Sheth for the defendant respondent in reply has contended that the purpose of letting cannot be assumed.
It has got to be alleged and proved.
The plaintiff could seek eviction under s.13(1)(k) of the Act only when he proves the purpose for which the premises have been let out and that the same has not been used for the purpose for which it was let out.
In the instant case neither the purpose of letting is indicated in the rent note nor has it been proved by evidence.
Therefore, the liability of the defendant under s.13(1)(k) does not arise.
The material portion of the rent note, Exbt.61, is as follows: .
The property of the said measurement and situate within the said four boundaries is rented by us from you and you have rented it to us.
The rent accrues from the date 18.4.1955.
It is agreed that the rent fixed is Rs. 1325 (Rupees thirteen hundred and twenty five) per year.
We shall pay the said rent to you every year in full.
If default is made in paying the rent you may get the said property vacated by us and our objection of any kind shall not be tenable in respect of the same.
The period fixed is for five years.
It expires on the date 17.4.1960.
We shall handover possession of the said property to you on the said date.
We shall not Rub let the said property to any one else.
The construction work which is made on the said 723 property belongs absolutely to us, the tenant.
And when we shall vacate the said property we shall remove the said construction work at the cost of us, the tenant.
We agree to handover the possession of the property to the owner in the same condition in which the property is rented.
Even if we use or do not use or keep the said property closed we, the tenant, are bound to pay the rent as stated above till the period fixed.
But if we the tenant, want to vacate the said property within the period fixed we can vacate the same by giving you notice before two months or if we want the said property on rent even after the expiry of the period fixed you are bound to give the same on rent and the rent is to be fixed according to the circumstances at that time and we shall pass and give a new rent note to you.
We, the tenant, are to pay Rs. 40 (Rupees forty) every year to you, the owner for municipal tax in respect of the said property in addition to the amount of rent.
If the municipal tax comes to more than forty rupees, you the owner are to pay the excess amount of tax.
A perusal of the rent note indicates that there is no specific mention of the purpose for which the premises was rented out to the defendant.
It has already been noted that the defendant had taken the premises from the predecessor in interest of the present plaintiff and had made certain superstructures on the land in question.
There is however, material on the record to show that the premises had been let out to the defendant for the purpose of business.
Indeed the premises had been taken in the name of a firm carrying on tobacco business.
The defendant admitted in his deposition that he had shifted his business to Baroda.
He had not used any portion of the land for any purpose for the last three or four years and the plaintiff has produced necessary registers from the Municipality and the Central Excise Department to show the same.
In addition, in the reply given by the counsel for the defendant to the notice of termination given by the plaintiff, he definitely admitted that the property was taken on rent by the tenant in his capacity as a manager and owner of the firm Vora Manilal Chhaganlal & Co. and that his client, the tenant, was a registered firm carrying on business in .
In this situation it cannot be argued with any force that the plaintiff has not been able to establish the purpose for which the premises had been let out to the defendant.
724 As s second limb to the argument Shri Sheth contended that if the plaintiff had specifically taken the plea of non user of the premises for the purpose for which it was let out he would have been able to prove the reasonable cause for not doing 80 but in the absence of such a plea the defendant has been seriously prejudiced.
This contention of the counsel also cannot easily be accepted when on the own admission of the defendant and defendant 's counsel the premises had been used for the purpose of carrying to tobacco business.
Therefore, the defendant fully knew the purpose for which he had taken the Promises as a tenant.
The stand of the defendant all through appears to be that even if he does not use the premises and have been paying rent he does not incur the liability of eviction and for this he banks upon the recital in the rent note that even if we use or do not use or keep the said property closed we the tenants are bound to pay the rent as stated above .
This stipulation in the rent deed only talks of the liability of the defendant to pay the rent even if he does not use the property and keeps it closet.
This, however, does not mean that the defendant can keep the premises closed without using it for years together before the suit.
This could never have been the intention of the law makers especially in these days of scarcity of accommodation in towns.
Even if the stipulation made in the rent note is construed to mean that the defendant tenant could keep the premises closed without using it for years together without incurring the liability of eviction, as is sought to be contended for the respondent, it would amount to allowing the parties contracting out of law.
This leads us to the second part of the submission made by the counsel for the appellant that on a correct interpretation of s.13(1)(k) of the Act even non user of the premises for any purpose whatsoever for years together would make him liable for eviction.
The contention on behalf of the respondent, however, is that we cannot add words to s.13(1)(k) and the intention of the legislature is clear from the words used therein, and all that s.13(1)(k) contemplates is that the premises had not been used for the purpose for which they w re let out for a continuous period of six months immediately preceding the date of suit without reasonable cause.
It toes not say that mere non user of the premises will make him liable for eviction.
The scheme of the Act as it appears from the preamble is to consolidate the law relating to the control of rents and repairs 725 of certain premises, of rates of hotels and lodging houses and of evictions.
m e control had to be brought in because of the scarcity of accommodation in the cities.
If this was the preamble of the Act it cannot be accepted that a tenant may take a premises on rent and keep it locked for years together without using it in the absence of any reasonable cause.
The intendment of the legislature could be carried out only when the premises is used and not kept vacant for years together.
Shri Sheth, however, sought to support the finding of the High Court that the construction of a superstructure is also a user of the property and the defendant had raised superstructures on the land in question.
This argument must be repelled.
It appears from the rent note, Exbt.
61, that the defendant had taken the premises from the present plaintiff when the defendant had already built the superstructures when he had taken the land on rent from the predecessor in interest of the plaintiff appellant.
Therefore, there was no question of using the land by raising constructions by the defendant after the execution of the rent note, Exbt.61.
Shri Sheth also referred to 8. 12 and 8. 13 of the Act and contended that these are the only two sections which give protection to the tenant and unless the conditions in the two sections are satisfied the tenant cannot be evicted.
What was let out by the plaintiff to the defendant tenant was the land and not the superstructures and so Shri Sheth argues that the non user of the superstructures does not amount to non user of the land.
On the own showing or the defendant respondent he had shifted his business to Baroda and, Therefore, he is not using the land for any purpose whatsoever.
Broadly speaking a premises can be let out either for residential or for business purpose.
In the instant case on the own showing of the defendant respondent it had been taken for the purpose of tobacco business and that business had been stopped for a period of 4 to 5 years before the institution of the suit as the business had expanded and the defendant had shifted to Baroda.
Therefore, it can be safely presumed that the land is not being used for the purpose for which it has been proved to have been let out.
The High Court in our opinion has gone wrong in holding that the construction of super structures on the land in dispute was itself a user.
As indicated earlier the super structures had already been built before the defendant took the land from the plaintiff under rent note, Exbt.61.
Therefore, there is no question of making any construction on the land in question by the defendant after the execution of the rent note.
726 As regards the sub tenancy it has been found by the courts below that it had been created long before the Act in question came into force and, therefore, there was no question of the eviction of the sub tenant as the sub tenancy was not illegal.
For the foregoing discussion the appeal must succeed.
It is accordingly allowed and the judgment of the High Court is set aside and the plaintiff 's suit stands decreed.
The parties shall however, bear their own costs.
[/INST]For the assessment year (1945 46) the assessable income of the appellant bank was computed by the Income tax Officer by splitting up its income into two heads " interest on securities " and " business income ", and deducting the business loss from interest on securities.
In the previous year the assessment showed a loss which was computed by setting off the " business loss against " interest on securities The appellant claimed that in the computation of its profits for the assessment year in question it was entitled to set off the carried over loss of the previous year under section 24(2) Of the Indian Income tax Act, 1922.
The Income tax Officer rejected the claim on the ground that the loss was under the head " business " and so could not be set off against income from securities under section 24(2) of the Act.
Both the Income tax Appellate Tribunal and the High Court, on reference, held that in view of sections 6, 8 and 10 of the Act " interest on securities " could not be treated as business income and therefore the appellant could not claim a set off under section 24(2).
On appeal to the Supreme Court it was contended for the appellant that (1) sections 8 and 10 should be so read that where the securities in the hands of an assessee are trading assets, section 8 would be excluded, being restricted to capital investments only, and the matter would fall under the head " business " within section 10, and (2) in any case, even if the income from securities fell under section 8, the appellant would be entitled to a set off under section
24(2) because it carried on only one business, namely banking, and the holding of securities by it was part of the said business.
Held, that the scheme of the Indian Income tax Act, 1922, is that the various heads of income, profits and gains enumerated in section 6 are mutually exclusive, each head being specific to cover the item arising from a particular source and, consequently, " interest on securities " which is specifically made chargeable to tax under section 8 as a distinct head, falls under that section and cannot be brought under section 10, whether the securities are held as trading assets or capital asset," 80 Commissioner of Income Tax vs Chunnilal B. Mehta, Salisbury House Estate Ltd. vs Fry, (1930) 15 T. C. 266, Commercial Properties Ltd. vs Commissioner of Income Tax, Bengal, and H. C. Kothari vs Commissioner of Income Tax, Madras, , relied on.
The question whether the holding of securities by the appellant formed part of the same business within section 24(2), could not be decided in the absence of a finding that the securities in question were a part of the trading assets held by the appellant in the course of its business as a banker, and the case was remitted to the High Court for a fresh decision on the reference after getting from the Tribunal a fuller statement of facts.
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<s>[INST] Summarize the judgementiminal Appeals Nos.
60 and 63 of 1965.
Appeals from the judgment and order dated November 20, 1963 of the Gujarat High Court in Criminal Appeals Nos. 957 and 796 of 1963 respectively.
Urmila Kapur and section P. Nayar, for the appellant.
The respondent did not appear.
The Judgment of the Court was delivered by Dua, J.
These two criminal appeals (Nos. 60 and 63 of 1965) with certificate raise a common question and are, therefore, being disposed of by a common judgment.
The Gujarat High Court also recorded the main judgment only in Criminal Appeal No. 60 of 1965.
The question which arises for determination is whether, several accused persons jointly tried have been acquitted by the trial Court, the state can ' prefer one appeal against the acquittal of all of them.
The High court held such a joint appeal not to be maintainable under Cr.
P.C. and so holding rejected the appeal by the State without going into the merits.
The Division Bench of the ,High Court speaking through Raju, J. recorded a very lengthily order though the reasoning in support of the non maintainability of the joint appeal is confined to a couple of pages only.
The High Court in its order referred to ss 258, 410, 417, 419 and 423 of the Code and came to the conclusion that the scheme of Chapter XXXI of the Code as disclosed by these sections and particularly by section 419 is against the maintainability of a joint appeal by the State against an order acquitting several accused persons tried jointly.
Section 419 was construed by the High Court to contain a bar against a joint appeal.
The major portion of the impugned order dealt with the question of binding character of the Full Bench decision of that High Court since reported as Lalu Jela vs State of Gujarat(1) on the Division Bench hearing the present appeals.
After a lengthy ,discussion the Division Bench came to the conclusion that the Full Bench decision holding a joint appeal to be maintainable in law was not binding on it.
On the view that we propose to take on the question of main tainability of a joint appeal against a common order acquitting (1) A.I.R. 1962 Guj.
877 several accused persons tried jointly, we do not consider it necessary to embark on a lengthy discussion on the question of binding charter of decisions of Full Benches and of Division Benches on future Benches of co ordinate jurisdiction of the same High Court.
We may only make a passing reference to the decisions of this Court cited at the bar in support of such binding character.
In Mahadeolal Ranodia vs The Administrator General of West Bengal(1), this Court observed as follows : "We have noticed with some regret that when the earlier decision of two judges of the same High Court in Beorajan 's an 's case was cited before the learned judges who heard the present appeal they took on themselves to say that the previous decision was wrong, instead of following the usual procedure in case of difference of opinion with an earlier decision, of referring the question to a lar ger Bench.
Judicial decorum no less than legal propriety forms the basis of judicial procedure.
If one thing is more necessary in law than any other thing, it is the quality of certainty.
That quality would totally disappear if judges of co ordinate jurisdiction in a High Court start overruling one another 's decision.
If one Division Bench of a High Court is unable to distinguish a previous decision of another Division bench and holding the view that the earlier decision is wrong itself gives effect to that view, the result would be utter confusion.
" Other decisions cited containing similar observations are : jai Kaur and others vs Sher Singh etc.
(2 ) and Atma Ram vs State of Punjab and others(3).
We are aware of a still more recent decision of this Court in Jaisri Sahu vs Rai Dewan (4) in which re Ference is made to a Privy Council decision in Budha Singh vs Laltu Singh(5).
The question of competency of a joint appeal by several per sons convicted by one order at a joint trial was referred for authoritative decision to a Full Bench of the Gujarat High Court in Lalu Jela 's case(6).
The argument before the Full Bench was that r. 6 in Chapter XXVI of the Bombay High Court Appellate Side Rules (which are applicable to the proceedings in Gujarat High Court) was inconsistent with Chapter XXXI of the Code of Criminal Procedure, with the result that a joint appeal to the High Court by several persons convicted at a joint trial was not maintainable.
The Full Bench on an exhaustive discussion held such (1) [1960]3.S.C.R. 78 (2) (3) (4) (5) I.L.R , 37 All, 604 (P.C.).
(6) A.I.R. 1962 Guj.
125. 878 an appeal to be competent and did not consider r. 6 to be inconsistent with Chapter XXXI of the Code.
The decision of this Court in Rabari Ghela Jadav.
State of Bombay(1) was explained and distinguished.
If we agree with the principle accepted in the Full Bench decision then the present appeals would on the reasoning of that decision seem prima facie to possess merit and in the absence of some other cogent reason to the contrary the appeals would have to succeed.
Chapter XXVI of the Bombay High Court Appellate Side Rules, 1960 deals with "criminal business" and r. 6 is in the following words "Joint appeal or application by persons affected by the same judgment.
All persons aggrieved,by a judgment or an order passed in a criminal case, may join in one appeal or application for revision, and one copy of the judgment or order complained of shall be sufficient." This rule, of course, does not in terms cover the case of an appeal by the State against several accused persons jointly tried and acquitted by the trial Court by a common order, but if an appeal by persons jointly tried and convicted is competent, then on principle it is difficult to negative the maintainability of one appeal by the State against a common order acquitting several persons tried jointly.
This rule deals with a matter of procedure and not of Substantive rights and seems to be based on sound commonsense.
Procedure has been described to be a hand maid and not a mistress of law, intended to subserve and facilitate the cause of justice and not to govern or obstruct it.
Like all rules of procedure, this rule demands a construction which would promote this cause.
So construed a joint appeal, in compliance of this rule must be sustained.
The power to frame this rule is specifically conferred on the High Court by section 554(2)(c) Cr.
P.C. and r. 6 does not seem to us to be inconsistent with any provisions of the said Code.
Holding this rule to be valid, in agreement with the decision of the Full Bench, the competency of a joint appeal by several accused persons convicted at one trial must be upheld.
On the same reasoning a joint appeal by the State against several accuses.
persons acquitted at a joint trial has also to be held not to be contrary to any provision of the Code and therefore not legally prohibited.
Section 419 of the Code on which the High Court seems to have relied in support of the non maintainability of a joint appeal by the State, lays down inter alia that every appeal shall be made in the form of a petition in writing presented by the appellant (1) A.I.R, 1960 S.C. 748.
879 or his pleader and every such petition shall, unless the court otherwise directs, be accompanied by a copy of the judgment or order appealed against.
This section does not seem to us to prohibit a joint appeal by the State against more than one accused persons.
The contrary view taken by the, High Court on the construction of this section is clearly unacceptable.
Section 417 which provides for an appeal in a case of acquittal empowers the State Government to direct the public prosecutor in any case to present an appeal from an order of acquittal.
This section also does not suggest any bar or prohibition against presentation of a joint appeal against several accused persons acquitted in a case.
On the other hand, it provides for an appeal in a case, and not against an accused person, who has, been acquitted.
The plain reading of this sections therefore.
, seems to be wide enough to permit a joint appeal.
Sections 258, 410 and 423 of the Code also do not seem to indicate any bar as is suggested by the order of the High Court.
This Court in Rabari Ghela Jadav 's case(1), on the basis of which the judgment of the High Court mainly proceeds, merely lays down that the Appellate Court hearing an appeal cannot admit it only on a question of sentence and that such a restricted order of admission being invalid, the appellant would be entitled to insist that his appeal should be heard on the merits.
This decision, in Our opinion, does not militate against the maintainability of a joint appeal.
The Full Bench decision of the Gujarat High Court rightly distinguished and explained this decision.
As observed earlier, once we accept the Full, Bench to lay down the correct rule of law, then there cannot be much difficult in upholding the maintainability of a joint appeal by the State against several accused persons acquitted at a joint trial.
There being no legal bar (at least we are aware of none either in the Cr.
P.C. or elsewhere), such an appeal cannot be held to suffer from any serious legal infirmity.
And then the matter being one of mere form it calls for a liberal approach requiring the appeal to be heard on the merits.
To hold it to be unmaintainable on this ground would defeat the larger cause of justice.
Unfortunately, we did not have the advantage of arguments on behalf of the respondents because they were unrepresented, but on considering the scheme of the relevant provisions of the Code of Criminal Procedure, we are of the view that the High Court was wrong in holding the joint appeal not to be maintainable and in summarily rejecting the same.
We accordingly allow the appeal, set aside the order of the High court and remit the case back to it for decision of the appeal on the merits.
G.C. Appeal allowed.
(1) A.I.R. 1960 S.C. 748.
[/INST]The respondents were tried jointly and acquitted by a common judgment.
State of Gujarat filed a Joint appeal against their acquittal in.
the High Court.
Rule 6 of the Bombay High Court Appellate Side Rules, 1960 (which were applicable to the proceedings in the Gujarat High Court) provided for joint appeals by persons aggrieved by a common judgment or order.
There was however no, rule specifically providing for similar joint appeals by the State.
A Division Bench of the High Court dismissed the joint appeal by the State against the respondents on the ground that such an appeal was not maintainable.
The Division Bench held that the decision by a Full Beach of the High Court in Lalu lela 's case in which a contrary view had been taken was not binding on the Division Bench.
In appeal to this Court against the judgment of the Division Bench.
HELD : (i) The Division Bench was in error in not treating as binding the earlier decision of a Full Bench of the same court on the same question.
1877 A F] Mahadeolal Kanodia vs The Administrator General of West Bengal, ; , Jai Kaur & Ors.
vs Sher Singh etc. , Atma Ram vs State of Punjab & Ors. , Jaisri Sahu vs Rai Dewan, [19621 2 S.C.R. 559 and Budha Singh vs Laltu Singh, I.L.R. 37 All. 604 (P.C.), applied.
(ii) Rule 6 of the Bombay High Court Appellate Side Rules does not in terms cover the case of an appeal by the State against several accused persons jointly tried and acquitted by the trial court by a common order, but if an appeal by persons jointly tried and convicted is competent, then on principle it is difficult to negative the maintainability of one appeal by the State against a common order acquitting several persons tried jointly.
Like all rules of procedure this rule demands a construction which would ' promote the cause of justice and not obstruct it.
(878 D F] A joint appeal by the State against several accused persons acquitted at a joint trial is not contrary to any provision of the Code of Criminal Procedure and is therefore not legally prohibited.
Sections 258, 410, 417, 419 or 423 of the Code do not indicate any bar as was suggested by the order of the High Court.
Indeed the plain reading of section 417 which pro%ides for an appeal in a case and not against an accused person, seems to be wide enough to permit ,A joint appeal.
The matter being one of mere form it calls for a liberal approach requiting the appeal to be beard on its merits.
The order of the High Court must accordingly be set aside.
[878 G H; 879 C F] 876 Rabari Ghela jadav V. State of Bombay, A.I.R. 1960 S.C. 748, ,explained.
Lalu Jela.
vs State of Gujarat, A.I.R. 1962 Guj. 125, approved.
</s>
|
<s>[INST] Summarize the judgementivil Appeal No. 2319 of 1986.
From the Judgment and Order dated 7.3.
1986 of the Allahabad High Court in Revision Petition No. 454 of 1985.
Shanti Bhushan, section Dastur, J.J. Bhatt, A. Dayal and K.J. John for the Appellant.
L.M. Singhvi, Depanker Gupta, P.L. ' Dubey, N.R. Khaitan, A.M. Singhvi, U.K. Khaitan, Ajay Jain, Praveen Kumar and C. Mukhopadhya for the Respondent.
The Judgment of the Court was delivered by CHINNAPPA REDDY, J.
The appellant, General Electric Company, a multi national, entered into a contract with the respondent, Renusagar Power Company Limited, an Indian Company, agreeing to sell equipment for a Thermal Electric generating plant to be erected at Renukoot on the terms and conditions set forth in the contract.
For the purposes of this case, it is unnecessary to set out the terms of the contract and the details of what was envisaged to be done by the parties.
It is also unnecessary to set out the various events that took place subsequently.
It is sufficient to state that on March 2, 1982, the GEC submitted certain disputes between the GEC and Renusagar for arbitration to the International Chambers of Commerce.
On June 11, 1982, Renusagar filed a suit in the Bombay High Court .for a declaration that the claims purported to be referred to arbitration by GEC to ICC were beyond the scope and purview of the arbitration agreement contained in the contract and sought an injunction to restrain the GEC from taking any further steps pursuant to their request for arbitration addressed to ICC on March 2, 1982.
In Renusagar 's suit, GEC, on August 11, 1982 filed a petition under section 3 of the For eign Awards (Recognition and Enforcement) Act, 196 1 seeking a stay of the suit.
On August 19, 1982 GEC also filed a suit in the Calcutta High Court against the United Commercial Bank to enforce a bank guarantee given by the bank at the instance of Renusagar.
On November 25, 1982, Renusagar filed a suit No. 127 of 1982 in the Court of Civil Judge, Mirzapur praying for a declaration that the guarantee given by the United Commercial Bank for and on behalf of the plaintiff stood 864 discharged and had become ineffective and unforceable and for a mandatory injunction against the GEC directing and ordering them to settle the plaintiff 's claim regarding 75 MVA Transformers and to satisfy validly the settlement arrived at of the plaintiff 's claim as mentioned in para 12 of the plaint.
It is useful to refer at this juncture to some of the happenings in the proceedings in the Bombay High Court.
On April 20, 1983, a learned single Judge of the Bombay High Court dismissed the notice of motion taken out by Renusagar for stay of the arbitration proceedings and allowed the application of GEC for stay of further proceedings in the Bombay High Court.
Appeal filed by Renusagar to the Division Bench of the High Court were dismissed on October 21, 1983.
Further appeals filed by Renusagar to the Supreme Court were also dismissed on August 16, 1984.
The Supreme Court held that the claims of GEC were arbitrable and that the decision of the court was conclusive on that issue and would not arise before the court of arbitration of ICC.
On January 17, 1983, GEC filed an application (7 C) purporting to put on record their complaint that annexures to the plaint had not been received by them.
On the same day, the Civil Judge made an order: "Copy of the plaint has been given to the defendant (GEC) so that the defendant may file a written statement.
" On the same day, the defendant GEC also filed another application (8 C) purporting to be 'under section 20 and Order VII r. 11 read with section 151 of the Code of Civil Procedure ' praying that the court may be pleased to reject the plaint and the suit.
In this applica tion, it was stated that the suit was in abuse of the proc ess of the court and an attempt to harass the defendants.
The court was requested to dismiss the plaintiff 's suit on that ground as also on other grounds which were thereafter mentioned.
It was stated that the defendant did not reside and no cause of action arose within the local limits of the jurisdiction of the court.
There was a violation of the stipulation laid down in section 20 of the Code of Civil Proce dure resulting in an abuse of the process of the court.
It should entail a dismissal of the suit.
The suit had been fradulently instituted on insufficient court fee and for that reason also the suit deserved to be dismissed.
The defendant then proceeded to state that they reserved the right to take further objections as preliminary objections to the maintainability of the suit and craved leave to add to or alter or amend the application whenever necessary.
What is important to be noticed here is that there was no prayer at this juncture for a stay of the suit.
On January 19, 1983, GEC filed an application (10 C) requesting the Court to call upon Renusagar to furnish a complete record of the suit and annex 865 ures.
The Civil Judge passed an order: ' "The case is called out.
Shri J.P. Singh, present for the plaintiff, Shri R.S ' Dhawan, Advocate for the defendant.
10 C by the defendant to direct the plaintiff to give copies of complete record so that the defendant may plead preliminary objections.
The copies of papers have been given.
Now the defendant may file_W.S. by March 4, 1983.
Put up on March 7, 1983 for issues.
Preliminary objections like 7 C and 8 C can be heard and disposed of after filing of written statement when the issues may be framed.
" On March 4, 1983 which was the date fixed by the Civil Judge for the filing of a written state ment by GEC, GEC filed three applications before the Mirza pur Court: 11 C, 12 C and 13 C. 13 C was styled as "objec tions by the defendant to the jurisdiction of the court to entertain this suit for declaration and injunction.
" The document began with the statement: "The Hon 'ble court has no jurisdiction to entertain this suit because of the following reasons.
" Seven reasons were set forth.
The first and the fourth grounds related to the territorial jurisdiction of the court.
The second ground stated that the plaint did not disclose any cause of action and, therefore, was liable to be rejected under Order VII CPC.
The third ground stated that from the statements in the plaint, the suit was barred by limitation.
The plaint was, therefore, liable to be rejected under Order VII r. 11 D.
The fifth ground was to the effect that the reliefs claimed were untenable on their face and the suit was liable to be straightaway dismissed on that account.
The sixth ground was that the suit was liable to be stayed under section 10 or section 15 1 of the CPC.
The seventh ground was: "Similarly the suit is liable to be stayed as regards the second relief claimed by the plaintiff under section 3 of the and Foreign Awards (Recognition & Enforcement) Act, 1961 and/or section 34 of the Indian or under all of them".
Thereafter the document proceeded to amplify the seven grounds by detailed reference to the allegations in the plaint and by further traversing those allegations.
In regard to the seventh ground that the suit was liable to be stayed under section 3 of the Foreign Awards (Recognition and Enforcement) Act, 1961, it was stated: "The present claim arises out of the only contract between the parties entered into in 1964.
Disputes arising out of or related to this contract have to be settled, after being unable to resolve such disputes by, sincere negotiation by arbitration under the rules of the International Chamber of Commerce Court of Arbitration because of the provisions of article XVIII of the said contract.
The defendant is ready and willing to have the present dispute raised by the 866 plaintiff in this plaint to be settled by arbitration without prejudice to the defence of want of cause of action, the bar of limita tion and all other defenses.
This Hon.
Court is therefore "bound to stay the present suit under section 3 of the Foreign Awards (Recognition and Enforcement) Act, 1961.
" The final prayer made in the application (13 C) was: "For the above reasons it is prayed that the plaint be either rejected for failure to disclose the cause of action or as being barrred for limitation on the face of it, or it be returned to be plaintiff for presenta tion to a proper forum.
Further, the suit is also liable to be dismissed because reliefs claimed by the plaintiff are untenable on their face.
Again, alternatively the suit is liable to be stayed under section 10 and/or section 151 CPC in respect of first relief and under section 3 of the Foreign Awards (Recognition and En forcement) Act, 1961 in respect of the second relief claimed by the plaintiff in the plaint.
" 11 C was an application under Order VIII Rule 9 and section 151 CPC seeking postponement of the striking of issues from March 7, 1983 to 4th or 5th of April, 1983.
In the course of the application it was recited: "That in keeping with the time schedule fixed by this Hon 'ble Court in effect, that a written statement be filed on March 4, 1983, the defendant is filing objections to the jurisdiction of the court to entertain this suit for declaration and injunction to file a subsequent pleading as written statement on merits in the event of the objections taken in the preliminary written statement dated 21st February, 1983 being rejected".
The reference to the objections to the jurisdiction of the court and the preliminary written statement dated 21st February, 1983 was obviously to 13 C which was verified at Singapore on February 21, 1983.
12 C was an application to grant leave to the defendant to file a subsequent pleading as written statement on merits if the court rejected the objections taken in the prelimi nary written statement.
This application was filed under Order VIII Rule 9.
On March 7, 1983, the court adjourned the case to April 5, 1983 and from time to time thereafter.
On May 31, 1983, GEC filed their written statement raising their pleas in defence to Renusagar 's suit.
However, in the first paragraph it was stated: 867 "The defendant has filed in this Hon 'ble Court an application under section 20 and Order VIII Rule 9 read with section 15 1 CPC for rejection of the plaint with special costs to the defendant on January 15, 1983.
The defend ant has also placed on record on January 17, 3983 that a copy of the plaint was supplied without annexures and documents and without the injunction application said to have been filed.
The defendant has filed its preliminary written statement contesting the jurisdiction of this Hon 'ble Court to try and entertain the suit as no cause of action has arisen to the plaintiff to sue this defendant on March 4, 1983.
An appropriate application under Order VIII Rule 9 read with section 151 CPC was also filed for leave to file subsequent plead ings as written statement on merits in the event of the preliminary written statement and the pleas being rejected was also filed on the same date.
" In the second paragraph, it was added, "This defendant craves leave of this Hon 'ble Court to incorporate the preliminary objec tions taken hithertofore by this defendant in its applications and pleadings and preliminary written statement as if the same are set out herein extenso. " Later in paragraph 6 and 7 of the written statement, it was stated as follows: "6.
The plaintiff states and submits that the preliminary objections are sufficient to dispose of the entire claim in suit on issues of law alone which go to the root of the Jurisdiction aspect of the suit and its apparent non maintainability and these sought to be decided as prelimi nary questions of law." "7.
Without prejudice of the preliminary objections referred to hereinabove and deemed to be incorporated herein as stated this defendant shall now deal with the plaint para wise and on merits . . . " The plaintiff objected to the presentation of the writ ten statement on the ground that it was filed outside court hours.
The plaintiff also filed an application for postpone ment of the date of settlement of 868 issues.
On August 4, 1983, the defendant filed an applica tion (19 C), requesting the court to settle the issues on August 18, 1983 itself without further postponement.
There after the case was adjourned from time to time.
On October 19, 1983, the plaintiff filed an application (2c) requesting the court to set the defendant ex parte as not having filed any written statement and to decree the suit.
On August 1, 1984, the Plaintiff, Renusagar filed an application, 25 A, for amendment of the Plaint.
The amendment sought included a prayer for a decree in a sum of Rs.62,72,272.
After contest, the application for amendment was allowed on October 15, 1984 and GEC was given time to file an additional written statement.
A few days earlier, the defendant had filed application (30 C) requesting the court to decide the issues regarding maintainability and jurisdiction and stating that the suit may proceed after decisions on these issues.
On this application, the court made an order on October 15, 1984 to the effect that a similar request had earlier been rejected by the Court on January 19, 1983 and it was not therefore, open to the Court to reopen the matter.
On November 31, 1984, GEC filed an application (34 D) seeking time to file a written statement "if so advised" and postponement of settlement of issues.
Time was granted.
On January 5, 1985, GEC filed an application (65 C) stating that they had consistently pleaded that the issues relating to the jurisdiction of the court and maintainability of the suit should be heard first and reiterating that request prayed that two issues may be struck and decided before the case was proceeded upon on merits.
The two issues suggested were: "(1) whether the Hon 'ble Court had jurisdiction to try and entertain the suit and (2) Whether the present suit is maintainable against the defendantapplicant who neither resides nor carries on busi ness in India." On February 2, 1985, the Mirzapur Court rejected the appli cation, commenting that such a request was being repeatedly made.
Against the order of the Mirzapur Court rejecting the application 65 C, GEC filed a petition under article 227 before the Allahabad High Court for quashing the proceedings in the suit.
In ground eight of the petition, it was stated that GEC had already raised the plea that the suit was liable to be stayed under section 3 of the Foreign Awards (Recognition & Enforcement) Act, 1961.
It was also stated in ground No. twelve that the question of arbitrarbility of the disputes had already been decided by the Supreme Court.
On April 4, 1985, the Allahabad High Court 869 dismissed the petition in limine observing as follows: "We have considered the matter carefully and we are of the view that so far as the court below has not been called upon to apply its mind to the provisions contained in section 3 of the Act.
Shri R.S. Dhawan who appears along with Shri V.N. Deshpande has stated at the bar that amongst other contentions advanced before the learned Civil Judge, he had pointedly pressed that in view of the aforesaid provi sions further proceedings in the suit should be stayed.
We have no doubt that such an argument must have advanced by him.
Nonethe less, the learned Civil Judge had not given any decision on this point.
We, therefore, consider it appropriate that the petitioner should make a fresh application setting out the relevant facts in the spirit of section 3 of the Act.
This application should be made within a fortnight from today.
If such an application is made within the time specified by us, the learned Civil Judge will dispose of the same on merits and in accordance with the law.
Till the learned Civil Judge disposes of this application he shall not proceed further with the hearing of the suit.
No other order is necessary at this stage.
With these obser vations the writ petition is dismissed sum marily.
" Consequent on the order of the High Court in the appli cation under article 227, GEC filed another application (83 C) before the Mirzapur Court on April 15, 1985 expressly set ting forth their objection under section 3 of the Foreign Awards (Recognition & Enforcement) Act and praying for a stay of the suit under that provision.
Reference was also made to their earlier applications made on March 4, 1983.
The con tentions raised in 13 C were reiterated.
This application (83C) was rejected by the learned Civil Judge, Mirzapur by an order dated July 9, 1985.
The learned Civil Judge took the view that the objection raised on the basis of section 3 of the Foreign Awards Act must, in the circumstances of the case, be considered to have been abandoned and the defendant considered to have elected to proceed with the suit.
The revision application referred by GEC to the High Court of Allahabad against the order dated July 9, 1985 was dismissed by the High Court on March 7, 1986.
The High Court referred to the contents of 13 C in great detail and concluded, "The plaint as initially presented appears to have been completely answered by the General Electric Company in its applica 870 tion 13 C which it may be remembered was also verified as a pleading, because in the written statement 16 Ka which was undoubtedly filed on May 31, 1983, no further facts are referred to . . 13 C is clearly in nature a written statement in the case, raising such pleas which constitute the defence of the General Electric Company to the case set up in plaint as it stood then".
The High Court also observed that it was apparent to them that the emphasis in 13 C was on the other objections and not on the objec tions under sec.
3 of the Foreign Awards Act.
The High Court also rejected the further contentions advanced on behalf of the General Electric Company that a fresh right to make an application under sec.
3 of the Foreign Awards (Recognition & Enforcement) Act accrued on the plaint being amended by Renusagar.
Stay of the Suit was, therefore, refused.
General Electric Company has preferred the present appeal against the judgment of the High Court of Allahabad under article 136 of the Constitution.
Shri Shanti Bhushan, on behalf of the appellant General Electric Company and Dr. L.M. Singhvi, on behalf of Renusa gar addressed elaborate arguments covering indeed a wide range of facts and law.
They also cited before us a host of cases Indian, English and Canadian.
We do not propose to examine the several side issues and non issues which have argued before us.
We propose to confine ourselves to the basic questions which were argued before us namely, (a) whether either 8 C or 13 C could be considered to be a step in the suit so as to disentitle the defendant from seeking a stay of the suit under sec.
3 of the Foreign Awards (Recog nition & Enforcement) Act, (b) whether 13 C was in the nature of a written statement, the filing of which precluded the defendant from seeking a stay and (c) whether the de fendant could be said to have abandoned the right to seek a stay in the circumstances of the case.
The Foreign Awards (Recognition & Enforcement) Act was enacted 'to enable effect to be given to the Convention on the Recognition & Enforcement of Foreign Arbitral Awards done at New York, on the th day of June, 1958, to which India is a party and for purposes connected therewith '.
The Convention is set forth in the Schedule to the Act and section 4(i) of the Act provides that a foreign award shall, subject to the provisions of the Act, be enforceable in India as if it were an award made on a matter referred to arbitration in India.
Except section 3, we are not concerned with the remaining provisions of the Act.
Section 3 is as follows: "Stay of proceedings in respect of matters to be refer 871 red to arbitration: Notwithstanding anything contained in the , or in the Code of Civil Procedure, 1908, if any party to an agreement to which Article II of the Convention set forth in the Schedule applies, or any person claiming through or under him commences any legal proceedings in any Court against any other party to the agreement or any person claiming through or under him in respect of any matter agreed to be referred to arbitration in such agreement, any party to such legal proceedings may, at any time after appearance and before filing a written statement or taking any other step in the proceedings, apply to the Court to stay the proceedings and the Court, unless satis fied that the agreement is null and void, inoperative or incapable of being performed or that there is not, in fact, any dispute be tween the parties with regard to the matter agreed to be referred, shall make an order staying the proceedings.
" Section 3 of the Foreign Awards (Recogni tion & Enforcement) Act is analogous to section 34 of the Indian which is as follows: "Agreement or any person claiming under him in respect of any matter agreed to be referred, any party to such legal proceed ings may, at any time before filing a written statement or taking any other steps in the proceedings, apply to the judicial authority before which the proceedings are pending to stay the proceedings; and if satisfied that there is no sufficient reason why the matter should not be referred in accordance with the arbitration agreement and that the applicant was, at the time when the proceedings were commenced, and still remains, ready and will ing to do all things necessary to the proper conduct of the arbitration, such authority may make an order staying the proceedings.
" It may be straightaway noticed that while section 34 of the Indian vests in the Court the discretion to stay or not to stay the proceedings, section 3 of the Foreign Awards (Recognition & Enforcement) Act vests no such discre tion in the Court.
Under the Foreign Awards (Recognition & Enforcement) Act it is mandatory that the proceedings could be stayed if the conditions prescribed are fulfilled.
But, whether it is a defendant who invokes the discretion of the Court 872 under section 34 of the Indian or whether it is a defendant who seeks to enforce the right under section 3 of the Foreign Awards (Recognition & Enforcement) Act, it is neces sary that he should not have disentitled himself, from doing so either by filing a written statement or by taking any other step in the proceedings.
His application to the Court, be it under section 34 of the Indian .
or section 3 of the Foreign Awards (Recognition & Enforcement) Act may be filed "before filing a written statement or taking any other step in the proceedings.
" It is competent then only and not thereafter.
The question is when may a written statement said to have been filed or when may any other step said to have been taken in the proceedings? On the question of the meaning of the expression 'step in the proceedings ', on the question of the proper approach to the solution of the problem and on allied questions, we were referred by the learned counsel for GEC and Renusagar to decisions of the *English Courts, decisions of the **Canadian Courts and ***passages from textbooks.
We do not propose to refer to them in our judgment not because we do not find them instructive; indeed we read them carefully and found them helpful, but because we think that reference to such persuasive authority is justified only if there is no guidance from binding authority.
The time has perhaps ar rived to discourage uninhibited reference to and extravagant use of foreign precedents, though indeed we welcome such precedents when they explore virgin territory and expand the horizons of legal thought.
The setting of a foreign judgment is the foreign country 's past and present history, its economic relations, its social relations, its trade and commerce, its traditions, its values, its needs, the stages of the development of its people, its legal * 1.
Ford 's Hotel Company Ltd. vs Bartlett (1896(I) AC 1) 2.
Ochs vs Ochs Brothers ( 1909 (II) Ch.
121) 3.
Parker, Gaines & Co. vs Turpin ( 1918 (I) KB 358) 4.
Henry vs Geopresco International Ltd. ( 1975 (2) All Eng.
LR 702) 5.
Tracomin SA vs Sudan Oil Seeds ( 1983 (I) All Eng.
LR 404) 6.
In re.
The Tuyuti (1984 (2) All Eng.
LR 545) **1.
Raymond vs Adrema Ltd. 2.
Fathers of Confederation Bldgs.
Trust vs Pigott Con struction Company Limited * * * 1.
Russell on Arbitration (20th Edition) 2.
Commercial Arbitration by Mustil & Boyd.
873 ideology, its constitutional direction and strategies and its statutes and precedents.
Foreign precedents are to be read and remembered in their setting, out never to be ele vated to the level of binding precedents and, therefore, to be avoided from frequent and needless question.
Section 34 of the Indian has received the consideration of the Supreme Court in State of U.P .v.
Janki Saran Kailash Chander, [1974 (I) SCR 31] and Food Corporation of India vs Yadav Engineer, [1983 (I) SCR 95].
In State of Uttar Pradesh vs Janki Saran Kailash Chandra (supra), the facts were that the summons in a suit institut ed against the State of Uttar Pradesh were served on the District Government Counsel.
On September 2, 1966, the District Government Counsel entered his appearance in the suit and also filed a formal application praying for a month 's time for filing a written statement.
Time was grant ed as prayed for.
On October 1, 1966, the District Govern ment Counsel filed an application under section 34 of the Arbi tration Act pleading that there was an arbitration clause in the agreement between the parties, that the State was will ing to have the matter referred to arbitration and that the suit should therefore, be stayed.
The Trial Court stayed the suit.
But, on appeal, the High Court took the view that the application for time for filing the written statement was a step in the proceedings within the meaning of that expres sion in section 34 of the and the defendant was therefore, disentitled to claim that the suit should be stayed.
The Supreme Court affirmed the decisions of the High Court observing, "In our view there is no serious infirmity in the impugned judgment of the High Court and we are unable to find any cogent ground for interfering under article 136 of the Constitution.
" The Court then proceeded to discuss the scope and meaning of section 34 of the and went on to observe: "To enable a defendant to obtain an order staying the suit, apart from other conditions mentioned in section 34 of the , he is required to present his application praying for stay before filing his written statement or taking any other step in the proceedings.
In the present case the written statement was indisputably not filed before the application for stay was presented.
The question is wheth er any other step was taken in the proceeding as contemplated by section 34 and it is this point with which we are directly concerned in the present case.
Taking other steps in the suit 874 proceedings connotes the idea of doing some thing in aid of the progress of the suit or submitting to the jurisdiction of the Court for the purpose of adjudication of the merits of the controversy in the suit.
" Thereafter, the Court also noticed that the State had taken benefit of the appearance of the District Standing Counsel and his successful prayer for adjournment of the case by one month for the purpose of filing the written statement.
Dealing with the question whether the High Court had interfered with the discretion of the Trial Court, it was observed, "If the appellants ' application was for ad journment for the purpose of filing a written statement, then there is no question of any exercise of the discretion by the Trial Court.
Discretion with regard to stay under section 34 of the is to be exercised only when an application under that Section is otherwise competent.
Incidentlly it is worth noting that even the order of the trial Court is not included by the appellant in the paper book and we do not know the reasoning of that Court for granting stay.
But on the view that we have taken that omission is of little consequence.
" The Court then added, "Keeping in view the long delay after the institution of the suit and the fact that the suit is for a very heavy amount by way of damages for breach of contract, it will, in our opinion, be more satisfactory on the whole to have the suit tried in a competent court of law in the normal course rather than by a lay arbitrator who is not bound either by the law of evidence or by the law of procedure." In Food Corporation of India ,,,.
Yadav Engineer (supra) the question arose whether the appearance of the defendant and his prayer for time to reply to the notice of motion taken out by the plaintiff for an interim injunction could be said to amount to a step in the proceeding so as to disentitle the defendant from seeking a stay of the proceed ing under sec.
34 of the .
First interpreting sec.
34 without the aid of authority, Desai, J. speaking for the court, observed that if a party to an arbitration agree ment sought to enforce the agreement by seeking a stay of the suit, he was obliged to disclose his unequivocal inten tion to abide by the agreement by asking for stay 875 before taking any step which may unequivocally indicate otherwise, that is, a step which may unequivocally indicate the intention to waive the benefit of the arbitration agree ment.
"Abandonment of a right to seek resolution of dispute as provided in the arbitration agreement must be clearly mani fested by the ' step taken by such party.
Once such unequivocal intention is declared or abandonment of the fight to claim the benefit of the agreement becomes manifest from the conduct, such party would then not be entitled to enforce the arbitration agreement because there is thus a breach of the agreement by both the parties disentitling both to claim any benefit of the arbitration agreement.
Section 34 provides that a party dragged to the court as defendant by another party who is a party to the arbitration agreement must ask for stay of the proceedings before filing the written statement or before taking any other step in the proceedings.
That party must simultaneously show its readiness and willing ness to do all things necessary to the proper conduct of the arbitration.
The legislature by making it mandatory on the party seeking benefit of the arbitration agreement to apply for stay of the proceedings before filing the written statement or before taking any other steps in the proceedings unmistakably pointed out that filing of the written statement discloses such conduct on the part of the party as would unquestionably show that the party has abandoned its rights under the arbitration agreement and has disclosed an unequivocal intention to accept the forum of the court for resolution of the dispute by waiving its right to get the dispute resolved by a forum contemplated by the arbitration agreement.
When the party files written state ment to the suit it discloses its defence, enters into a contest and invites the court to adjudicate upon the dispute.
Once the court is invited to adjudicate upon the dispute there is no question of then enforcing an arbitra tion agreement by forcing the parties to resort to the forum of their choice as set out in the arbitration agreement.
This flows from the well settled principle that the court would normally hold the parties to the bargain (see Ramaji Dayawala & Sons (P) Ltd. vs Invest Import, [ 1981] (I) SCR 399." Posing next the question what other steps the legislature contemplated as disentitling a party from obtaining stay of the proceedings, the 876 learned Judges applied the principle of ejusdem generis and held: "That some other step must indis putably be such step as would manifestly display an unequivocal intention to proceed with the suit and to give up the right to have the matter disposed of by arbitration.
Each and every step taken in the proceedings cannot come in the way of the party seeking to en force the arbitration agreement by obtaining stay of proceedings but the step taken by the party must be such step as would clearly and unmistakably indicate an intention on the part of such party to give up the benefit of arbi tration agreement and to acquiesce in the proceedings commenced against the party and to get the dispute resolved by the court.
A step taken in the suit which would disentitle the party from obtaining stay of proceeding must be such step as would display an unequivocal intention to proceed with the suit and to abandon the benefit of the arbitration agree ment or the right to get the dispute resolved by arbitration.
" The learned judges then proceeded to consider the question whether an appearance in the suit to contest an interlocuto ry application, such as, an application for appointment of receiver or ex parte ad interim injunction, disclosed an unequivocal intention to proceed with the suit and give up in the benefit of the arbitration agreement.
The question was answered as follows: "Incidental proceedings for appoint ment of receiver or for interim injunction are for the protection either of the property or the interests of the parties.
Now, when ex parte orders are obtained on ex parte aver ments the other party cannot be precluded from coming and pointing out that no case is made out for granting interim relief.
It would be too cumbersome to expect the party first to apply for stay and then invite the court under section 41(2) of the Act to vacate the injunction or to discharge the receiver.
Giving the expression 'taking any other steps in the proceedings ' such wide connotation as making an application for any purpose in the suit such as vacating stay, discharge of the re ceiver or even modifying the interim orders would work hardship and would be inequitous to the party who is willing to abide by the arbitration agreement and yet be forced to suffer the inequity of ex parte orders.
There fore, the expression tak 877 ing any other steps in the proceedings ' must be given a narrow meaning in that the step must be taken in the main proceeding of the suit and it must be such step as would clearly and unambiguously manifest the intention to waive the benefit of the arbitration agreement and to acquiesce in the proceedings.
Interloc utory proceedings are incidental to the main proceedings.
They have a life till the dispos al of the main proceeding.
As the suit or the proceedings is likely to take some time before the dispute in the suit is finally adjudicat ed, more often interim orders have to be made for the protection of the rights of the par ties.
Such interlocutory proceedings stand independent and aloof of the main dispute between the parties involved in the suit.
They are steps taken for facilitating the just and fair disposal of the main dispute.
When these interlocutory proceedings are contested it cannot be said that the party contesting such proceedings has displayed an unequivocal intention to waive the benefit of the arbitra tion agreement or that it has submitted to the jurisdiction of the court.
When ex parte orders are made at the back of the party the other party is forced to come to the court to vindicate its right.
Such compulsion cannot disclose an unambiguous intention to give up the benefit of the arbitration agreement.
Therefore, taking any other steps in the proceedings must be confined to taking steps in the proceedings for resolution of the substantial dispute in the suit.
Appearing and contesting the interlocutory applications by seeking either vacation thereof or modifica tion thereof cannot be said to be displaying an unambiguous intention to acquiesce in the suit and to waive the benefit of the arbitra tion agreement.
Any other view would both be harsh and inequitous and contrary to the underlying intendment of the Act.
The first party which approaches the court and seeks an ex parte interim order has obviously come to the court in breach of the arbitration agree ment.
By obtaining an ex parte order if it forces the other party to the agreement to suffer the order or by merely contesting be imputed the intention of waiving the benefit of arbitration agreement, it would enjoy an undeserved advantage.
Such could not be the underlying purpose of section 34.
Therefore, in our opinion, to effectuate the purpose underlying section 34 the narrow construction of the expres sion 'taking any other steps in the proceed ings ' as hereinabove set out appears to ad vance the 878 object and purpose underlying section 34 and the purpose for which the Act was enacted.
" The court then referred to various decisions on the ques tion.
Thereafter the case of State of U. P. vs Jankisaran Kailashchandra, (supra) was discussed in detail.
After quoting from the judgment of Justice Dua, the court ob served: "The view herein taken not only does not run counter to the view we have taken but in fact clearly supports the view because the pertinent observation is that taking step in the proceeding which would disentitle a party to obtain a stay of the suit must be doing something in aid of the progress of the suit or submitting to the jurisdiction of the court for the purpose of adjudication of the merits of the controversy in the suit.
In other words, the step must necessarily manifest the intention of the party to abandon or waive its right to go to arbitration or acquiesce in the dispute being decided by court.
In fact, the view taken in this case should have quelled the controversy but it continued to figure in one form or the other and that is why we have dealt with the matter in detail." The Court finally concluded the discussion as follows: "Having thus critically examined both on principle and precedent the meaning to be given to the expression 'taking steps in the proceedings ', we are clearly of the view that unless the step alleged to have been taken by the party seeking to enforce arbitra tion agreement is such as would display in unequivocal intention to proceed with the suit and acquiesce in the method of resolution of dispute adopted by the other party, namely, filing of the suit and thereby indicate that it has abandoned its right under the arbitra tion agreement to get the dispute resolved by arbitration, any other step would not disenti tle the party from seeking relief under section 34.
It may be clearly emphasised that contesting the application for interim injunction or for appointment of a receiver or for interim relief by itself without anything more would not constitute such step as would disentitle the party to an order under section 34 of the Act. ' ' 879 Thus we see that it is the view of this court that a step in the proceeding which would disentitle the defendant from invoking sec.
34 of the should be a step in aid of the progress of the suit or submission to the juris diction of the court for the purpose of adjudication of the merits of the controversy in the suit.
The step must be such as to manifest the intention of the party unequivocally to abandon the right under the arbitration agreement and in stead to opt to have the dispute resolved on merits in the suit.
The step must be such as to indicate an election or affirmation in favour of the suit in the place of the arbi tration.
The election or affirmation may be by express choice or by necessary implication by acquiescence.
The broad and general right of a person to seek redressal of his grievances in a court of law is subject to the right of the parties to have the disputes settled by a forum of mutual choice.
Neither right is insubstantial and neither right can be allowed to be defeated by any manner of technicality.
The right to have the dispute adjudicated by a civil court cannot be allowed to be defeated by vague or amorphous mis called agreements to refer to 'arbitration '.
On the other hand, if the agreement to refer to arbitration is estab lished, the right to have the dispute settled by arbitration cannot be allowed to be defeated on technical grounds.
What do we have in the present case? We mentioned at the outset that GEC filed two applications on January 17, 1983, 7 C and 8 C.
In 7 C, GEC purported to put on record their complaint that they had not received the annexures to the plaint.
By no stretch of imagination could it possibly be paid that 7 C indicated either an abandonment of arbitration or an affirmation of the suit.
8 C was an application re questing the court to reject the plaint and the suit for the reasons set forth in the application.
One of the grounds urged was that the Mirzapur Court had no territorial juris diction.
Another ground was that the plaint was insuffi ciently stamped.
Yet another ground was that the plaint disclosed no cause of action.
Every one of the objections was in the nature of a preliminary objection to the trial of the suit on the merits of the dispute between the parties.
Every one of the objections was what may be called a thresh old objection pleaded as a bar to any further hearing of the suit.
None of the objections invited an adjudication on the merits of the controversy.
It was said that the return of a plaint under Order VII r. 10 and the rejection of a plaint under Order VII r. 11 put an end to the controversy so far as the court where the proceedings had been instituted and that the rejection of a plaint under Order VII r. 11 was a decree within the definition of that expression in Order II r. 2 of the Civil Procedure Code.
It was argued that the rejection of a plaint for non disclosure of a cause of action was also an 880 adjudication of the merits of the controversy in the suit and reliance was placed on decisions under the Representa tion of People Act.
We do not think that we can accept the argument nor are we able to derive any assistance from the cases cited.
In the first place, the expression 'merits of the controversy in the suit ' does not occur either under sec.
34 of the or sec.
3 of the Foreign Awards (Recognition and Enforcement) Act.
The words occur in the decision of this court in State of U.P .v.
Janki Saran Kailash Chandra (supra) where the court said, "Taking other steps in the suit proceedings connotes the idea of doing something in aid of the progress of the suit or submitting to the jurisdiction of the Court for the purpose of adjudi cation of the merits of the controversy in the suit.
" As often enough pointed out by us, words and expressions used in a judgment are not to be construed in the same manner as statutes or as words and expressions defined in statutes.
We do not have any doubt that when the words "adjudication of the merits of the controversy in the suit" were used by this court in State of U.P .v.
Janki Saran Kailash Chandra (supra), the words were not used to take in every adjudica tion which brought to an end the proceeding before the court in whatever manner but were meant to cover only such adjudi cation touched upon the real dispute between the parties which gave rise to the action.
Objections to adjudication of the disputes between the parties, on whatever ground, are in truth not aids to the progress of the suit but hurdles to such progress.
Adjudication of such objections cannot be termed as adjudication of the merits of the controversy in the suit.
As we said earlier, a broad view has to be taken of the principles involved and narrow and technical inter pretation which tends to defeat the object of the legisla tion must be avoided.
We are of the view that an invitation to the court to reject a plaint or dismiss a suit on a ground not touching the merits of the controversy between the parties, but a ground such as insufficiency of the court fee paid, maintainability of suit, territorial jurisdiction etc.
is really to enable the proceeding before the arbitra tor to go on and far from an election to abandon arbitration and continue the suit.
Every threshold bar to a suit set up by a defendant is a step to allow the arbitration to go on.
It is a step in aid of arbitration and not in aid of the progress of the suit.
In that view, we think that 8 C can hardly be called an invitation to the court to adjudicate upon the merits of the controversy, when in fact it is designed to prevent the court from touching upon the merits of the controversy.
The next set of events relied upon by the plaintiff to deny the defendant 's right to obtain stay in the filing by GEC of the applications 1c, 12 C and 13 C in the Mirzapur Court on March 4, 1983.4th 881 March and 7th March were the dates which had been fixed by the Court for filing the written statement and for the striking of the issues.
The defendant, on March 4, instead of filing the written statement, filed 11 C, 12 C and 13 C. 13 C, as already mentioned, was styled "objections by the defendant to the jurisdiction of the Court to entertain a suit for declaration and injunction".
It began with the statement, "the Hon 'ble Court has no jurisdiction to enter tain the suit for the following reasons" and ended with the prayer: "for the above reasons it is prayed that the plaint may be either rejected for failure to disclose a cause of action or as being barred by limitation on the face of it, or it be returned to the plaintiff for presentation to a proper forum.
Further the suit is also liable to be dismissed because reliefs claimed by the plaintiff are untenable on their face, Again, alternatively the suit is liable to be stayed under section 10 and/ or section 151 CPC in respect of first relief and section 3 of the For eign Awards (Recognition & Enforcement) Act 196 1 in respect of second relief claimed by the plaintiff in the suit.
" 11 C was an application seeking postponement of the striking of the issues from March 7 to a later date in the event of the preliminary objections being rejected.
12 C was an application to grant leave to file a subsequent pleading as written statement in the event of the preliminary objec tions being rejected.
Obviously ll C, 12 C and 13 C have to be read together and reading them together, it appears to us to be clear that the defendant raised objections to the trial of the suit on merits, which were loosely described as 'objections to the jurisdiction of the Court and objections to the maintainability of the suit ' and which were requested to be disposed of first, with a further request that if the objections were rejected the defendant may then be allowed to file a proper written statement on merits and issues struck thereafter.
The invitation to the Court was not to proceed with the suit but to refrain from proceeding with the suit until the preliminary objections were first decid ed.
The preliminary objections were set out by the defendant in 8 C and 13 C and we have set them out earlier while narrating the facts.
We notice that the preliminary objec tions raised were not of such a nature as to make adjudica tion on merits of any part of the real dispute between the parties necessary for deciding the preliminary objections.
While elaborating the preliminary objections, particularly in order to explain the contention that the plaint did not disclose a cause of action, the defendant did choose to controvert several factual averments made in the plaint.
We do not think that the 882 circumstances that the defendant chose to deny in his appli cation inviting decision on his preliminary objections, the allegations of material facts made by the plaintiff in the plaint changes the character of the applications into a written statement any more than a reply to a notice of motion seeking an ad interim injunction acquires the charac ter of a written statement merely because factual allega tions made in the plaint are also dealt with in the reply.
A defendant may consider it necessary to deny the averments of the fact in the plaint with a view to explain the prelimi nary objections raised by him or he may deny the averments of fact by way of abundant caution so as not to be under stood as having admitted (by not denying) the plaint aver ments.
In such a situation, the question to be considered is did the defendant intend it to be a written statement or was the document capable of being construed as setting out unreservedly the case which the defendant wished to put forward? Was it meant to answer the plaint? We do not think either 8 C or 13 C is capable of being so construed.
Neither the title of the documents nor the prayer in the documents would justify their being dubbed as written statements.
We have referred to their contents and we do not think it possible to view 8 C or 13 C as meant to answer the plaint.
They were objections and not answer to the Plaint.
We are unable to hold that either of them can be treated as a written statement.
It is of interest to note here that the plaintiff himself filed an application 21 C requesting the court to set the defendant ex parte on the ground that he did not file any written statement.
Obviously the plaintiff never considered 13 C to be a written statement.
We are also unable to hold that either of them can be said to be a step in the proceeding.
We have already explained why 8 C cannot be treated as a step in the proceeding.
The same reasons apply to 13 C also.
13 C invited the court to consider the preliminary objections amongst which was a prayer to stay the suit under section 3 of the Foreign Awards (Recognition & Enforcement) Act.
An invitation to the court to decide the preliminary objections was in fact a request to the court not to proceed with the trial of the suit on merits.
We are unable to hold that 13 C was an invitation to the court to adjudicate upon the merits of the controversy, when in fact as we said in the case of 8 C, it was designed to prevent the court from touching upon the merits of the controversy.
It was argued that the defendant himself sought permission for filing additional pleadings if preliminary objections were rejected and, therefore, the defendant himself thought that 13 C was a pleading, namely, a written statement.
Our attention was also invited to the written statement filed on May 31, 1983 in which the preliminary objections filed earlier were referred to as preliminary 883 written statement.
We do not think we will be justified in harping upon a word here or a word there.
As we said earli er, we propose to look at the substance of the matter and ignore the chaff.
Looking to the subStance of the matter, we find that before May 31, 1983, that is, the date on which the written statement was filed, the defendant did not take any step in the suit.
The applications filed by him were not in aid of the progress of the suit, but to request the court to refrain from proceeding with the suit.
13 C contained a prayer for the stay of the suit under section 3 of the Foreign Awards (Recognition & Enforcement) Act and we hold that, in terms of that provision, it was made before the written statement was filed and before any step in the proceeding was taken.
An argument which was presssed before us was that the conduct of the defendant was such that he must be considered to have abandoned his right to have the suit stayed under section 3 of the Foreign Awards (Recognition & Enforcement) Act.
We do not think there is any substance in the submission.
On the one hand, we have the outstanding circumstances that the defendant was proceeding with the arbitration.
On the other hand, we have also the circumstance that the defendant filed 13 C one of the prayers of which was a stay of the suit under section 3 of the Act.
The argument was that the defendant did not press his application and did not seek the orders of the court on 13 C.
This would not be a correct picture of the events since we find that even on January 19, 1983, the court made an order that preliminary objections like 7 C and 8 C could be heard and disposed of after filing of written statement when the issues may be framed.
We also find that at every stage the defendant kept referring to his prelimi nary objections and never for a moment abandoned them.
30 C was another application filed by him requesting the court to decide the preliminary objections regarding jurisdiction and maintainability of the suit.
On this the order was that it was not competent for the court to reopen the order dated January 19, 1983.
It was therefore, not the defendant 's fault that the preliminary objections were not decided.
Later again the defendant filed 34 C requesting the court to frame preliminary issues and try them on the question of the jurisdiction of the court and the maintainability of the suit.
This application was also rejected by the court with the comment that the request was being repeatedly made.
It was against this order that the defendant went to the High Court with the application 65 C.
The High Court directed the defendant to file an application for the trial court spe cially requesting that court to apply its mind to the provi sions of section 3 of the Foreign Awards (Recognition & Enforce ment) Act and pointedly pressing the contention relating to that provisions.
Pursuant to this direction, the defendant filed 83 C 884 before the trial court and it is on the orders made on this application that the present appeal has come before us.
The submission of the learned counsel for the plaintiff was that the appeal before us arose directly from the order made on the application 83 C not on the application 13 C.
According to the learned counsel, 13 C must be considered to have been given up and since 83 C was filed long after the filing of the written statement, it was incompetent.
We are unable to agree.
13 C was never abandoned by the defendant.
On the other hand 83 C also expressly refers to 13 C. 83 C is a reiteration and revival of 13 C with emphasis on the objec tion relating to section 3 of the Foreign Awards (Recognition & Enforcement) Act.
Looking to the substance of the matter and ignoring technicalities, we are firmly of the view that the defendant sought a stay of the suit before filing a written statement or taking any other step in the suit and that he never abandoned his right to have the suit stayed.
The appeals, therefore allowed with costs and the suit No. 127 of 1982 in the court of Mirzapur stayed under section 3 of the Foreign Awards (Recognition & Enforcement) Act.
In the view that we have taken we do not think it necessary to consider the further question raised by the learned counsel for the appellant that the amendment of the plaint introducing a substantially new cause of action gave the defendant a fresh right under section 3 of the Foreign Awards Act.
H.L.C. Appeal allowed.
[/INST]The appellant filed a petition for execution of the money decree obtained by her in High Court against the judgment debtor and attachment was levied in execution on open land and a portion of the premises in question belong ing to the judgment debtor.
Subsequently, the judgment debtor sold a portion of the attached property.
The purchas er in turn, sold a portion thereof to the respondents.
The aforesaid execution petition was dismissed for default but later on an application by the appellant, the said Execution Case was restored, and the said property was again attached, and a proclamation for sale of the said property was issued under Order 21 Rule 66 of the Code of Civil Procedure.
The respondents ' petition under Order 21, Rule 58 of C.P.C. for releasing the property purchased by the respondents from attachment was dismissed.
The High Court allowed the appeal.
In appeal to this Court, it was urged on behalf of the appellant that in view of the provisions of Section 64 of the Code of Civil procedure, the sale of the property by the judgment debtor to the purchaser and the sale thereafter by him to the respondents, which were both effected during the subsistence of the attachment, were void as against the appellant decree holder, and although the attachment ceased on the dismissal of the Title Execution Case, on May 9, 1972, it was revived by restoration of the case.
Allowing the appeal, this Court, HELD: An order of restoration of a suit dismissed for default would certainly restore or revive the attachment for the period during which it was in subsistence, namely, prior to the dismissal of the suit or execution application.
[ 1043D] 1039 In the present case both transactions, sale by the judgment debtor and subsequent sale by the purchaser to the respondents, were effected during the subsistence of the attachment and before the Title Execution Case was dismissed for default.
[1043C] The Division Bench of the High Court was in error in taking the view that by reason of the dismissal of the said Title Execution Case, the attachment came to an end and the order of restoration of the said case would not affect any alienations made before the restoration, although such alienations might have been made during the subsistence of the attachment.
[1044C] Sushila Bala Dasi vs Guest Keen Williams Ltd., I.L.R. 1949 Vol.
1 Calcutta, p. 177 Annapuma Patrani & Ors.
vs Lakshmana Kara & Anr., A.I.R. 1950, Madras, p. 740; Pradyut Natwarlal Shah vs Suryakant H. Sangani & Ors., A.I.R. 1979 Bombay, p. 166; Tavvala Veeraswami vs Pulim Ramanna & Ors., A.I.R. 1935 Madras, p. 365 and Patringa koer vs Madhavanand Ram & Ors., Calcutta Law Journal, 1911, Vol.
14 p. 476, referred to.
</s>
|
<s>[INST] Summarize the judgementivil Appeal No. 3119 of 1984.
From the Judgment and Order dated 20.9.1982 of the Delhi High Court in S.A.O. No. 181 of 1979.
Dr. Y.S. Chitale and Mukul Mudgal for the Appellant.
R.K. Garg, Gopal Singh, L.R. Singh and Mrs. Vimal Sinha for the Respondent.
The Judgment of the Court was delivered by: PATHAK, CJ.
This is a landlady 's appeal by special leave arising out of proceedings for the ejectment of the respondent tenant.
The appellant let out the premises in suit to the respondent on 1 September, 1962, the rent being stipulated as payable in advance.
With effect from 1 January, 1972 the rent payable was Rs. 515 per month.
On 29 November, 1972, the contractual tenancy was determined by notice.
The re spondent received a notice on 7 May, 1976 calling upon him to pay the arrears of rent.
The rent in fact had been re ceived upto 31 March, 1976 and, therefore, when the notice of demand was served on the appellant, rent for the months of April and May 1976 had fallen due.
The rent was payable in advance.
On 13 May, 1976, the respondent offered a bank draft of Rs.515 to the appellant.
The appellant refused to accept it.
Two days later, the respondent sent the same bank draft by registered post.
The appellant 746 received the bank draft and retained it.
On 7 June, 1976, the appellant wrote to the respondent informing him that his tender was not valid.
On 11 June, 1976, the appellant sent another bank draft for Rs.515 to the landlady, and this draft again was neither encashed nor returned.
On 2 August, 1976, the appellant filed an application for ejectment out of which the present appeal arises.
After filing the application for ejectment, the appellant informed the respondent that both the bank drafts sent by him were lying uncashed.
The Additional Controller, Delhi, dismissed the eviction petition holding that the tenant was not in default.
The Rent Control Tribunal, Delhi, noted that the rent was pay able in advance in accordance with the agreement between the parties, that the respondent had earlier enjoyed the benefit of section 14(2) of the Act, that when the notice of demand was served on 7 May, 1976 the arrears of rent for the months of April and May 1976 had arisen, that the bank draft sent on 13 May, 1976 related to the rent of April 1,976 only, that as the rent for the month of May 1976 had also become due but had not been tendered, the landlady was justified in not accepting the tender, and that when the respondent again sent a draft on 11 June, 1976 to cover the rent for the month of May 1976 the rent for the month of June 1976 had also fallen due but was not tendered.
Holding that the respondent had not tendered the arrears of rent due up to date within two months of the notice of demand, the Tribunal held that the ground of non payment of rent stood estab lished.
The Tribunal noted that the rent had not been paid for the months of April, May and June 1976 in advance for each month and, therefore, the respondent had committed three consecutive defaults.
That being so, the Tribunal observed, the respondent was not entitled to the benefit of section 14(2) again.
In second appeal, the High Court reversed the decision of the Rent Control Tribunal and dismissed the application for ejectment upon the finding that the notice demanding the arrears of rent related to the months of April and May 1976, and as one draft had been sent on 13 May, 1976 and another on 11 June, 1976 representing a total of two months ' rent, and as this rent had been paid within two months of the service of notice of demand, it must be taken that the rent due at the time of the service of notice of demand had been tendered by the respondent to the appellant.
The High Court proceeded on the view that section 14(1)(a) of the Act made out a ground for eviction only where the tenant had neither paid nor tendered the whole of the arrears of rent legally recov erable from him within two months of the date on 747 which a notice of demand for the arrears of rent was served on him by the landlord, the arrears being the rent due on the date of the notice.
In this case, the High Court said, as the notice called for payment of the arrears due for the months of April and May 1976 and the bank drafts were ten dered within the period indicated in the notice, the notice was satisfied and no default could be said to have been committed in terms of section 14(1)(a) of the Act.
Accordingly, the High Court allowed the appeal and dismissed the applica tion for ejectment.
It is urged before us by learned counsel for the appel lant that section 14(1)(a) of the Act contemplates the payment or tender of the whole of the arrears of rent legally recovera ble from the tenant on the date when the demand notice is sent including the rent which has accrued after service of the demand notice.
When the notice was sent on 7 May, 1976, rent for the months of April and May 1976 had become due, and as two months was given for payment of the arrears, it would include also the rent which had accrued during the said period of two months.
We are not satisfied that there is substance in the contention.
The arrears of rent envis aged by section 14(1)(a) of the Act are the arrears demanded by the notice for payment of arrears of rent.
The arrears due cannot be extended to rent which has fallen due after serv ice of the notice of demand.
In this case, the two bank drafts representing the arrears of rent covered by the notice of demand had been tendered within two months of the date of service of the notice of demand.
The High Court is fight in the view taken by it.
We are not satisfied that the construction placed by B.C. Misra, J. in Jag Ram Nathu Ram vs Shri Surinder Kumar, S.A.O. No. 52 of 1975 decided on 28 April, 1976 and in S.L. Kapur vs Dr. Mrs. P.D. Lal, All India Rent Control Journal 1975 p. 322 lays down the control law on the point.
In the result, the appeal fails and is dismissed but there is no order as to costs.
P.S.S. Appeal dismissed.
[/INST]The appellant State by virtue of the judgment in Nida marti Maheshkumar vs State of Maharashtra & Ors.
, ; , after providing 15 per cent of seats under the All India Quota and under Article 15 of the Constitution for admission to MBBS course, laid down the policy of reserva tion of the remaining seats for local students in the city of Bombay and for students from outside Bombay but within the State of Maharashtra, in the ratio of 70:30.
In the writ petitions preferred by the respondents a Single Judge of the High Court took the view that 30 per cent of seats meant for students from outside Bombay should have been filled in before 70 per cent of seats were filled in by local students.
The Division Bench dismissed the Letters Patent Appeal by the State.
In the Letters Patent Appeals by the respondents it directed creation of five additional seats in each of the three Municipal Medical Colleges and four additional seats in the Government Medical College.
Allowing the appeals, HELD: 1.
There was no unreasonableness or impropriety in the State Government 's decision to fill up 70 per cent of seats first.
The question whether the seats reserved for local students or for those residing outside Bombay should be filled up first was not within the purview or the juris diction of the Court.
The High Court was, therefore, not justified in directing admission on the basis of filling up 30 per cent of seats first.
[713C D] 2.
The Additional seats can be created only if the Indian Medical 711 Council approves of it.
There is also the question of bear ing the cost of creation of such seats.
In the instant case, neither the Government nor the Indian Medical Council had consented to such creation.
In exceptional circumstances and for ends of justice, the court may direct the creation of one or two seats after giving the Indian Medical Council an opportunity of being heard.
The High Court, therefore, should not have directed the creation of so many additional seats.
[713E G] [Appropriate directions issued for admission to four seats in the Grant Medical College in Bombay and thirty four seats in the other Bombay available under the All India Quota.]
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<s>[INST] Summarize the judgementCivil Appeal No. 2480 of 1977 From the Judgment and Order dated 28.3.77 of the Gujarat High Court in L.P.A. No. 232 of 1976.
R.N. Karanjawala 2nd P.H Parekh for the appellant.
M.N. Phadke, S.C. Patel and R.N. Poddar for the respondents.
The Judgement of the Court was delivered by PATHAK, J.
This appeal by special leave arises out of a writ petition filed by the appellant in the Gujarat High Court challenging an order terminating his services.
634 The appellant was appointed to the post of Sales Tax Officer by an order dated March 22, 1972.
The order recited that the appointment was on probation for a period of two years.
The period of two years expired, and the appellant continued in service and no order was made confirming his appointment.
On March 31, 1975 the appellant 's services were terminated.
Aggrieved by the termination of his services, the appellant filed a writ petition in the High Court of Gujarat, but by his judgment and order dated April 21, 1976 a learned Single Judge dismissed the writ petition.
An appeal was filed by the appellant, and an Appellate Bench of the High Court dismissed the appeal by its judgement and order dated March 28.
1977 Three points have been raised before us in this appeal.
The first contention is that the order terminating the appellant 's services was passed mala fide, the second is that on the expiry of the period of probation the appellant must be deemed to have been confirmed, and inasmuch as his services have been terminated without complying with clause (2) of Article 311 the order is invalid.
The last contention is that the principles of natural justice were violated inasmuch as on the facts of the present case the appellant.
even as a probationer, was entitled to be heard before his services were terminated.
On the first contention, the learned Single Judge as well as the Appellate Bench examined the material on the record and came concurrently to the conclusion that the allegation of mala fide was without foundation.
Learned counsel for the appellant has taken us through the record and has endeavored to show that the appellant had discharged his duties ably and with integrity, and there was no reason for terminating his services.
Various particulars were set forth in the special leave petition filed in this Court in support of that assertion.
Now, it appears that substantially the same allegations were set forth by the appellant in his writ petition, but in the affidavit filed in reply by the State Government those allegations were denied.
On the contrary, it was asserted that the appellant 's services were terminated entirely because of his unsatisfactory record and that the order was not vitiated by any illegality or unfairness.
In support of the plea of mala fides, the appellant alleged that his services had been terminated because he had taken proceedings against an assessee, Messrs. Shriraj & Company who, according to the appellant, enjoyed political favour and influence with the authorities.
The allegation 635 has been denied in the counter affidavit.
During the hearing of the special leave petition this Court directed the State Government to file a specific affidavit relating to the facts alleged in the writ petition regarding a confidential enquiry initiated by the Government.
The affidavit filed in reply admits that an enquiry was initiated against the appellant on the complaint of the said assessee, but it maintains that there was no mala fides on the part of the Ministers concerned and that a persual of the record relating to that enquiry shows that the allegation of mala fides is wholly baseless.
We have considered the matter carefully and we find no sufficient reason to differ from the finding of the High Court that the allegation of mala fides is not established.
We think it desirable to observe that where a finding of fact has been rendered by a learned Single Judge of the High Court as a Court of first instance and thereafter affirmed in appeal by an Appellate Bench of that High Court, this Court should be reluctant to interfere with the finding unless there is very strong reason to do so.
The second contention on behalf of the appellant is that the appellant must be deemed to have been confirmed inasmuch as he was allowed to continue in service even after the expiry of the period of probation of two years specified in the order of appointment.
We are of opinion that when the order of appointment recited that the petitioner would be on probation for a period of two years, it conformed to Rule 5 of the Recruitment Rules which prescribes such period of probation.
The Rule states further that the period of probation may be extended in accordance with the rules.
The period of two years specified in the Rule is merely the initial period for which an officer may be appointed on probation.
As the terms of the same Rule indicate, the period of probation may be extended.
The period of two years does not represent the maximum period of probation.
It is next urged that as no rules have been framed indicating the manner for extending the period of probation, there is no power to extend the period of probation.
The argument suffers from a fallacy.
The power to extend the period of probation must not be confused with the manner in which the extension may be affected.
The one relates to power, the other to mere procedure.
Merely because procedural rules have not been framed does not imply a negation of the power.
In the absence of such rules, it is sufficient that the power is exercised fairly and reasonably, having regard to the context in which the power have been granted.
636 It is then submitted that the appellant enjoyed a legitimate expectation of being confirmed on the expiry of two years of probation and on successfully completing the qualifying tests and training undergone by him.
We are not impressed by that contention.
It was open to the State Government to consider the entire record of service rendered by the appellant and to determine whether he was suitable for confirmation or his services should be terminated.
There was no right in the appellant to be confirmed merely because he had completed the period of probation of two years and had passed the requisite tests and completed the prescribed training.
The function of confirmation implies the exercise of judgment by the confirming authority on the overall suitability of the employee for permanent absorption in service.
The second contention must also be rejected.
The last contention is that the appellant should have been heard before his services were terminated.
The order of termination does not contain any stigma or refer to any charge of misconduct on the part of the appellant.
It is said that the State Government terminated the appellant 's services because a complaint had been made against him by Messrs. Shriraj & Company, whose case had been dealt with by him, and that the appellants should have been given a hearing to show that there was no basis for the complaint.
There would have been substance in this contention if the appellant 's services had been terminated on the ground of misconduct committed in connection with the case of Messrs. Shriraj & Company.
On the contrary, it appears from the record before us that the appellant 's services were terminated because on an overall appreciation of his record of service he was found unsuitable for being absorbed in the service.
A distinction is sought to be drawn between a probationer whose services are terminated on the expiry of the period of two years and a probationer, who has completed the normal span of two years and whose services are terminated some time later after he has put in a further period of service.
We are unable to see any distinction.
It is perfectly possible that during the initial period of probation the confirming authority may be unable to reach a definite conclusion on whether the candidate should be 637 confirmed or his services should be terminated.
Such candidate may A be allowed to continue beyond the initial period of two years in order to allow the confirming authority to arrive at a definite opinion.
It seems to us difficult to hold that a candidate enjoys any greater right to confirmation if he is allowed to continue beyond the period of probation.
B In our judgment there is no force in this appeal, and it is dismissed but in the circumstances without any order as to costs.
S.R. Appeal dismissed.
[/INST]The services of the appellent who was appointed to the post of Sales Tax Officer, by an order dated March 22, 1972 on probation for a period of two years, but continued thereafter in service without any order confirming him in his appointment were terminated on March 31, 1975.
The writ petition filed in the High Court of Gujarat, challenging the said terminated was dismissed, by a judgment dated April 21, 1976.
Finding no basis for the allegation of mala fide on facts the court held that there was no right to confirmation on the expiry of the period of probation, and therefore, there was no violation of the provisions of Clause (2) Article 311 of the Constitution.
An appeal filed by the appellant was dismissed by the Division Bench, on March 28, 1977.
Hence the appeal, by special leave of the Court.
Dismissing the appeal, the Court, ^ HELD 1.1.
The allegation of mala fides is wholly baseless and has not been established.
Where a finding of fact has been rendered by a learned Single Judge of the High Court as a Court of first instance and thereafter affirmed in appeal by an Appellate Bench of that High Court, the Supreme Court should be reluctant to interfere with the finding unless there is very strong reason to do so.
[635C D1 2.1 When the order of appointment recited that the appellant would be on probation for a period of two years, it conformed to Rule 5 of the Recruitment Rules which prescribes such period of probation.
Under the Rule the period of probation may be extended in accordance with the rules.
The period of two years specified in the Rule is merely the initial period for which an officer may be appointed on probation and does not represent the maximum period of probation In terms of the said rule the period of probation may be extended.
[635E F] 633 2.2 The power to extend the period of probation must not be confused A with the manner in which the extension may be effected.
The one relates to power, the other to mere procedure.
Merely because procedural rules have not been framed does Dot imply a negation of the power.
In the absence of any rule indicating the manner for extending the period of probation, it is sufficient that the power is exercised fairly and reasonably, having regard to the context in which the power has been granted.
[635G H] B 3.1 There is no question of any legitimate expectation of being confirmed or even right to confirmation on the expiry of two years of probation and on successfully completing the qualifying tests and training undergone by a Government employee.
It was open to the State Government to consider the entire record of service rendered by its employee and to determine whether he was suitable for confirmation or his services should be terminated.
The function of confirmation implies the exercise of judgment of the confirming authority on the overall suitability of the employee for permanent absorption in service.
[636A B] 3.2 The contention that the appellant should have been heard before his services were terminated is not correct since the order of termination does not contain any stigma or refer to any charge Or misconduct on the part of the appellant and the termination was on the basis of an overall appreciation of his record of service disentitling him to be absorbed in the service.
No distinction lies between a probationer whose services are terminated on the expiry of two years and a probationer who has completed the normal span of two years and whose services are terminated some time later after he has put in a further period of service.
It is perfectly possible that during the initial period of probation the confirming authority may be unable to reach a definite conclusion on whether the candidate should be confirmed or his services should be terminated.
Such candidate may be allowed to continue beyond the initial period of two years in order to allow the confirming authority to arrive at a definite opinion.
A candidate does not enjoy any greater right to confirmation if he is allowed to continue beyond the initial period of probation.
[636G H; 637A B]
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<s>[INST] Summarize the judgementAppeal No. 43 of 1964, Appeal by special leave from the award, dated August 3, 1962 of the Central Government Industrial Tribunal, Dhanbad in Reference No. 56 of 1961.
B. Sen and I.N. Shroff, for the appellants.
The respondent did not appear.
The Judgment of the Court was delivered by Hidayatullah, J.
This is an appeal by special leave against the Award dated August 3, 1962, of the Central Government Industrial Tribunal Dhanbad, under the 448 449 The appellants are the Employers in relation to Digwadih Colliery and the respondents their workmen.
The workmen did not appear in this Court.
The dispute was whether the management of the colliery was justified in terminating the services of Jaldhar Singh with back wages.
Jaldhar Singh was a 'badli ' workman which means (as defined by the Standing Orders of the colliery) a person appointed in the post of a permanent employee or probationer who is temporarily absent.
He worked as badli in the calendar years 1959 and 1960 in different capacities.
His employment was, of course, not continuous and there were six breaks of one day to a week in 1959 and eight breaks of one day to a week in 1960.
However, he worked for more than 240 days in each calendar year though with these interruptions.
In January 1961 the colliery terminated Jaldhar Singh 's service without notice to him or payment of wages in lieu of notice or compensation.
A dispute arising, conciliation was attempted but failed and the reference followed.
Before the Tribunal the workmen claimed that Jaldhar Singh was a permanent workman while the Employers contended that he was temporary.
The Employers stated that as some of the permanent staff had become surplus, there was no need of badli workmen and the termination of Jaldhar Singh 's service was justified.
The workmen attempted to prove that Jaldhar Singh was permanent from 1960 and produced some documents from which they asked that this inference be drawn but the Tribunal did not agree.
The workmen relied in the alternative upon section 25F of the Act because Jaldhar Singh had put in service of 240 days in each of the years and contended that as the Employers had failed to comply with the provisions of section 25F the termination of service was illegal and unjustified.
The Employers submitted that section 25F could apply only if Jaldhar Singh had put in 240 days ' continuous service in any of the years 1959 or 1960.
The service of Jaldhar Singh was admittedly terminated as there was no work for him and not on account of disciplinary action or voluntary retirement, superannuation or ill health.
This was thus a case of retrenchment as defined in section 2(00) of the Act.
Section 25F, which was inserted as part of Chapter VA, with effect from October 24, 1953 by the Industrial Disputes (Amendment) Act 1953 (43 of 1953) provides: "25F. Conditions precedent to retrenchment of workmen.
No workman employed in any industry who has been in continuous service for not less than one year under an employer shall be retrenched by that employer until (a) the workman has been given one month 's notice in writing indicating the reasons for retrenchment and the period of notice has expired, or the workman has 450 been paid in lieu of such notice, wages for the period of the notice: Provided that no such notice shall be necessary if the retrenchment is under an agreement which specifies a date for the termination of service; (b) the workman has been paid, at the time of retrenchment, compensation which shall be equivalent to fifteen days ' average pay for every completed year of service or any part thereof in excess of six months; and, (c) notice in the prescribed manner is served on the appropriate Government," The section, if it applied, had plainly not been complied with I in respect of any of the conditions precedents Jaldhar Singh, as seen already, had not been given any notice or wages in lieu of notice or paid compensation and no notice had been served on the appropriate Government.
The termination of service would, in these circumstances, be illegal.
But the Employers pointed, out that section 25F required two conditions: (a) continuous service and (b) service for not less than one year, and contended that these conditions were not fulfilled as the service was not continuous but broken.
They relied on the definition of "continuous service" in section 2(eee) which was introduced by the same amending Act: "2(eee) continuous service means uninterrupted service, and includes service which may be interrupted merely on account of sickness or authorised leave or an accident or a strike which is not illegal, or a lock out or a cessation of work which is not due to any fault on the part of the workman;" The workmen, on the other hand, relied upon the provisions of section 25B which read: "25B. Definition of one year of continuous service.
For the purposes of sections 25C and 25F, a workman who, during a period of 12 calendar months, has actually worked in an industry for not less than two hundred and forty days shall be deemed to have completed one year of continuous service in the industry.
Explanation.
In computing the number of days on which a workman has actually worked in any industry, the days on which (a) he has been laid off under an agreement or as permitted by standing orders made under the , or under this Act or under any other law applicable to the industrial establishment, the largest number of days during 451 which he has been so laid off being taken into account for the purposes of this clause, (b) he has been on leave with full wages, earned in the, previous year, and (c) in the case of a female, she has been on maternity leave; so however that the total period of such maternity leave shall not exceed twelve weeks, shall be included.
" The definitions in section 2 of the Act do not apply if there is anything repugnant in the subject or context and the question is whether the definition of "continuous service" can at all apply in considering section 25F when what is meant by the expression "one year of continuous service" in section 25F is, by section 25B specially stated.
If section 25B had not been enacted the contention of the Employers would have been unanswerable for the words of section 25F would then have plainly meant that the service should be for a period of 12 months without interruptions other than those stated in section 2(eee) itself.
But section 25B says that for the purpose of section 25F a workman who, in a period of twelve calendar months has actually worked for not less than 240 days shall be deemed to have completed one year of continuous service.
Service for 240 days in a period of twelve calendar months is equal not only to service for a year but is to be deemed continuous service even if interrupted.
Therefore, though section 25F speaks of continuous service for not less than one year under the employer, both conditions are fulfilled if the workman has actually worked for 240 days during a period of twelve calendar months.
It is not necessary to read the definition of continuous service into section 25B because the fiction converts service of 240 days in a period of twelve calendar months into continuous service for one complete year.
Mr. B. Sen drew our attention to the Industrial Disputes (Amendment) Act 1964 which was passed last December.
By section 2(iii) of the amending Act of 1964 clause (eee) of the second section of the principal Act was omitted and by section 13, for section 25B in the principal Act the following was substituted: "25B. For the purposes of this Chapter, (1) a workman shall be said to be in continuous service for a period if he is.
for that period, in uninterrupted service, including service which may be interrupted on account of sickness or authorized leave or an accident or a strike which is not illegal, or a lock out or a cessation of work which is not due to any fault on the part of the workman; (2) where a workman is not in continuous service within the meaning of clause (1) for a period of one year 452 he shall be deemed to be in continuous service under an employer (a) for a period of one year, if the workman, during a period of twelve calendar months preceding the date with reference to which calculation is to be made, has actually worked under the employer for not less than (i) one hundred and ninety days in the case of a workman employed below ground in a mine; and (ii) two hundred and forty days, in any other case; The Explanation to section 25B is the same, mutatis mutandis as before.
Mr. Sen contended that the change in the law brought out his contention.
We do not agree.
The amended section 25B only consolidates the previous sections 25B and 2(eee) in one place, adding some other matters which are not relevant to the present purpose, but the purport of the new provisions is not different.
In fact the amendment of section 25F of the principal Act by substituting in cl.
(b) the words "for every completed year of continuous service" for the words "for every completed year of service" now removes a discordance between the unamended section 25B and the unamended cl.
(b) of section 25B.
Neither before these several changes nor after is uninterrupted service necessary if the total service is 240 days in a period of twelve calendar months.
The only change in the new Act is that this service must be during a period of twelve calendar months preceding the date with reference to which calculation is to be made.
The last amendment now removes a vagueness which existed in the unamended section 25B.
We accordingly hold that the decision under appeal is correct.
The appeal fails and is dismissed.
Appeal dismissed.
[/INST]The respondents hired lockers in the safe deposit vaults from the appellant bank at Jullundur through its manager under different agreements on various dates during 1950.
In April 1951, the lockers were tampered with and the valuables of the respondents kept in them were removed by the Manager.
In due course the Manager was prosecuted and convicted for theft.
The respondents filed three suits against the bank for the recovery of different sums being the value of the contents of the lockers which had been removed.
The bank denied its liability on various grounds and also contended that the suits were, barred by limitation.
The trial court held that the Bank was liable to bear the loss incurred by the respondents and that the suits were not barred by limitation.
On appeal, the High Court accepted the findings of the trial court on both the questions and dismissed the appeals.
In the appeal before the Supreme Court, only the question of limitation was raised.
It was contended of behalf of the appellants on the facts found that the suit was barred by limitation as the theft of the valuables by the Manager was a tort committed by him dehors the contracts entered into by the appellant with the respondents and, therefore, Article 36 of the Limitation Act which required that a suit must be instituted within two years applied, and not article 115, which provided for a period of limitation of three years; that the suits were, not based on a breach of contract committed by the bank but only the theft committed by its agent dehors the terms of the contract.
HELD: The suit claims, being ex contractu, were clearly governed by Article 115 of the First Schedule to the Limitation Act and by Article 36.
[298F] There were clear allegations in the plaint that the appellant committed breach of contract in not complying with some of the contitions thereof and that the appellant understood those allegations in that light and traversed them.
[298 E] Even ii the respondents ' claim was solely based on the fraud committed by the manager during the course of his employment, such a claim could not fall under article 36.
To attract article 36, the misfeasance must be independent of contract.
The fraud of the manager committed in the course of his employment must be deemed to be a fraud of the principal, i.e. the Bank must be deemed to have permitted manager to commit theft in violation of the terms of the contracts.
While under the contracts the bank was under an obligation to provide good lockers and not to permit access to the safe except to persons mentioned in the contracts, in violation of these terms the bank gave defective lockers and gave access to the manager, thus facilitating the theft.
In either case the wrong committed was not independent of the contract but directly arose out of the breach of contract.
[298 G, H]
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<s>[INST] Summarize the judgementminal Appeal No. 248 of 1964.
87 Appeal from the judgment and order dated September 16, 1964 of the Allahabad High Court in Criminal Appeal No. 348 of 1964 and capital sentence No. 26 of 1964.
P.C. Khanna, for the appellant.
O.P. Rana, for the respondent.
The Judgment of the Court was delivered by Subba Rao, J.
Sahoo, the appellant, is a resident of Pachperwa in the District of Gonda.
He has two sons, Badri and Kirpa Shanker.
He lost his wife years ago.
His eldest son, Badri, married one Sunderpatti.
Badri was employed in Lucknow, and his wife was residing with his father.
It is said that Sunderpatti developed illicit intimacy with Sahoo; but there were incessant quarrels between them.
On August 12, 1963, during one of those quarrels,Sunderpatti ran away to the house of one Mohammed Abdullah ,a neighbour of theirs.
The appellant brought her buck, and after some wordy altercation between them they slept in the only room of their house.
The only other inmate of the house was the appellant 's second son, Kirpa Shanker, a lad of about 8 years.
On the morning of August 13, 1963, Sunderpatti was found with serious injuries in the room of the house where she was sleeping and the appellant was not in the house.
Sunderpatti was admitted in the Sadar Hospital Gonda, at 5.25 p.m. on that day and she died on August 26, 1963 at 3 p.m. Sahoo was sent up for trial before the Court of Sessions, Gonda, on a charge under section 302 of the Indian Penal Code.
The learned Sessions Judge, on a consideration of the entire evidence came to the conclusion that Sahoo killed Sunderpatti.
On that finding, he convicted the accused under section 302 of the Indian Penal Code and sentenced him to death.
On appeal, a Division Bench of the High Court at Allahabad confirmed both the conviction and the sentence.
Hence the appeal.
Except for an extra judicial confession, the entire evidence in the case is circumstantial.
Before we advert to the arguments advanced in the appeal it will be convenient to narrate the circumstances found by the High Court, which are as follows: (1) The accused had illicit connections with the deceased; (2) the deceased and the accused had some quarrel on the Janmashtami day in the evening and the deceased had to be persuaded through the influence of their neighbors, Mohammed Abdullah and his womenfolk, to go back to the house of the accused; (3) the deceased was seen in the company of the accused for the fast time when she was alive; (4) during the fateful night 3 persons, namely.
the accused.
the deceased and the accused 's second son, Kirpa Shanker (P.W. 17), slept in the room inside the house; (5) on the early morning of next day, P.W. 17 was asked by his father to go out to attend to calls of nature, and when he came back to the verandah of the house he heard some gurgling sound and he saw his father going out of the house murmuring something; and (6) P. Ws. 9, 11, 13 88 and 15 saw the accused going out of the house at about 6 a.m. on that day soliloquying that he had finished Sunderpatti and thereby finished the daily quarrels.
This Court in a series of decisions has reaffirmed the following well settled rule of "circumstantial evidence".
The circumstances from which the conclusion of guilt is to be drawn should be in the first instance fully established.
"All the facts so established should be consistent only with the hypothesis of the guilt of the accused and the circumstances should be of a conclusive nature and tendency that they should be such as to exclude other hypotheses but the one proposed to be proved.
" Before we consider whether the circumstances narrated above would stand the said rigorous test, we will at the outset deal with the contention that the soliloquy of the accused admitting his guilt was not an extra judicial confession as the Courts below held it to be.
If it was an extra judicial confession, it would really partake the character of direct evidence rather than that of circumstantial evidence.
It is argued that it is implicit in the concept of confession, whether it is extra judicial or judicial, that it shall be communicated to another.
It is said that one cannot confess to himself: he can only confess to another.
This raises an interesting point, which fails to be decided on a consideration of the relevant provisions of the Evidence Act.
Sections 24 to 30 of the Evidence Act deal with the admissibility of confessions by accused persons in criminal cases.
But the expression "confession" is not defined.
The Judicial Committee in Pakala Narayana vs R.(1) has defined the said expression thus: "A confession is a statement made by an accused ' which must either admit in terms the offence.
or at any rate substantially all the facts which constitute the offence.
" A scrutiny of the provisions of sections 17 to 30 of the Evidence Act discloses, as one learned author puts it, that statement is a genus.
admission is the species and confession is the sub species.
Shortly stated, a confession is a statement made by an accused admitting his guilt.
What does the expression "statement" mean? The dictionary meaning of the word "statement" is "the act of stating, reciting or presenting verbally or on paper." The term "statement" therefore, includes both oral and written statements.
Is it also a necessary ingredient of the term that it shall be communicated to another? The dictionary meaning of the term does not warrant any such extension; nor the reason of the rule underlying the doctrine of admission or confession demands it.
Admissions and confessions are exceptions to the hearsay rule.
The Evidence Act places them in the category of relevant evidence, presumably on the ground that, as they are declarations against the interest of the person making them, they are probably true.
The probative value of 89 an admission or a confession does not depend upon its communication to another, though, just like any other piece of evidence, it can be admitted in evidence only on proof.
This proof in the case of oral admission or confession can be offered only by witnesses who heard the admission or confession, as the case may be.
The following illustration pertaining to a written confession brings out the said idea: A kills B; enters in his diary that he had killed him, puts it in his drawer and absconds.
When he places his act on record, he does not communicate to another; indeed, he does not have any intention of communicating it to a third party.
Even so, at the trial the said statement of the accused can certainly be proved as a confession made by him.
If that be so in the case of a statement in writing, there cannot be any difference in principle in the case of an oral statement.
Both must stand on the same footing.
This aspect of the doctrine of confession received some treatment from wellknown authors on evidence, like Taylor, Best and Phipson.
In "A Treatise on the Law of Evidence" by Taylor, 11th Edn., Vol.
I, the following statement appears at p. 596: "What the accused has been overheard muttering to himself, or saying to his wife or to any other person in confidence, will be receivable in evidence.
" In "The Principles of the Law of Evidence" by W.M. Best, 12th Edn., at p. 454, it is stated much to the same effect thus: "Words addressed to others, and writing, are no doubt the most usual forms; but words uttered in soliloquy seem equally receivable.
" We also find the following passage in "Phipson on Evidence", 7th Edn., at p. 262: "A statement which the prisoner had been overheard muttering to himself,f, if otherwise than in his sleep, is admissible against him, if independently proved." These passages establish that communication to another is not a necessary ingredient of the concept of "confession".
In this context a decision of this Court in Bhogilal Chunilal Pandya v The State of Bombay(1) may usefully be referred to.
There the question was whether a former statement made by a witness within the meaning of $. 157 of the Evidence Act should have been communicated to another before it could be used to corroborate the testimony of another witness.
This Court, after considering the relevant provisions of the Evidence Act and the case law on the subject came to the conclusion that the word "statement" used in section 157 meant only "something that is stated" and the element of communication was not necessary before "something that is stated" became a statement under that section.
If, as we have said, statement is the genus and confession is only a sub species of that genus, we do not see any reason why the statement implied in the confession should be given (1) [1959] Supp. 1 S.C.R. 310. 90 a different meaning.
We, therefore, hold that a statement, whether communicated or not, admitting guilt is a confession of guilt.
But, there is a clear distinction between the admissibility of an evidence and the weight to be attached to it.
A confessional soliloquy is a direct piece of evidence.
It may be an expression of conflict of emotion; a conscious effort to stifle the pricked conscience; an argument to find excuse or justification for his act; or a penitent or remorseful act of exaggeration of his part in the crime.
The tone may be soft and low; the words may be confused; they may be capable of conflicting interpretations depending on witnesses, whether they are biased or honest, intelligent or ignorant, imaginative or prosaic, as the case may be.
Generally they are mutterings of a confused mind.
Before such evidence can be accepted, it must be established by cogent evidence what were the exact words used by the accused.
Even if so much was established, prudence and justice demand that such evidence cannot be made the sole ground of conviction.
It may be used only as a corroborative piece of evidence.
The circumstances found by the High Court, which we have stated earlier, lead to the only conclusion that the accused must have committed the murder.
No other reasonable hypothesis was or could be suggested.
Further, in this case, as we have noticed earlier, P.W.s 11, 13 and 15 deposed that they clearly heard the accused say when he opened the door of the house and came out at 60 'clock in the morning of the fateful day that he had "finished Sunderpatti, his daughter in law, and thereby finished the daily quarrels".
We hold that this extra judicial confession is relevant evidence: it certainly corroborates the circumstantial evidence adduced in the .case.
In the result, we agree with the conclusion arrived at by the High Court both in regard to the conviction and the sentence.
The appeal fails and is dismissed.
Appeal dismissed.
[/INST]The respondent who was assessed to agricultural income tax made an application to the Assessing Officer depositing compensation Bonds and prayed that the Bonds be accepted in payment of tax dues.
This was rejected stating that there was no rule for acceptance of these bonds.
Another attempt by the respondent was also turned down by the Collector.
Thereafter the respondent presented a writ petition in the High Court for directing them to accept the Bonds in lieu off the tax dues.
The High Court was of the opinion that the two officers completely ignored the provisions of section 6(d) of the Act and r. 8A, and directed the Collector to decide the respondent 's application in accordance with law.
In appeal by special leave: HELD: (i) Neither section 6(d) nor r. 8A provide that the Bonds must or can be accepted in payment of tax on agriculture income.
[133 E] Collector of Sultanpur vs Raja Jagdish Prasad Sahi. , referred to.
(ii) When the compensation payable to an intermediary has been paid in the form of cash or Bonds.
that compensation ceased to be payable.
The fact that the Bonds are negotiable does not make them legal tender and does not make it obligatory on anyone including Government to accept them in payment of any dues.
The only result of their being treated as negotiable instruments is that the owner of the Bonds can transfer them to any person who is agreeable to purchase them.
[134 D F]
</s>
|
<s>[INST] Summarize the judgementl Appeal No. 166/1963.
Appeal from the judgment and decree dated April 28, 1961 of the Bombay High Court in First Appeal No. 135 of 1958.
section T. Desai, section Singhvi, J. B. Dadachanji, 0.
C. Mathur and Ravinder Narain, for the appellant.
Purushottam Trikamdas, M. H. Chhatrapati and I. N. Shroff, for the respondent.
March 18, 1964.
The judgment of RAGHUBAR DAYAL and AYYANGAR, JJ. was delivered by RAGHUBAR DAYAL J. MUDHOLKAR J. delivered a dissenting Opinion.
RAGHUBAR DAYAL, J.
This appeal, on a certificate granted by the Bombay High Court, arises out of a petition praying for the annulment of the petitioner appellant 's marriage with the respondent, under section 12 of the (Act XXV of 1955), hereinafter called the Act, on the ground that the respondent was, at the time of marriage, pregnant by some person other than the petitioner.
The facts leading to the proceedings are that the appellant and the respondent were betrothed sometime in JuneJuly 1945 and were married on March 10, 1947.
The appellant went abroad about the end of April 1947.
A daughter was born to the respondent on August 27, 1947.
The appellant returned to India some time in November 1947, but the parties did not live together thereafter.
The appellant instituted a suit, No. 34 of 1947 48, in the Court of the State of Baroda, at Baroda, for the declaration of nullity of the marriage.
The suit was, however, dismissed on September 30, 1949 as the appellant failed to establish that he had his domicile in that State.
The Act came into force on May 18, 1955.
The appellant took advantage of its provisions and on April 18, 1956 filed the petition for annulment of his marriage with the respondent.
The appellant alleged in his petition that on learning of the birth of the child on August 27, 1947, five months and seventeen days after the marriage, he felt surprised and suspected that the child had been conceived long prior to the marriage through someone else, that the respondent was, at the time of their marriage pregnant by someone other than himself, that this fact was concealed from him and that ever since he had learnt of the birth of the child he had not lived or cohabited with the respondent nor had any relations with her whatsoever.
The respondent, in her written statement, raised various defences.
She admitted therein to have conceived the baby prior to the marriage, but alleged that she had conceived as a result of sex relations with the petitioner after their betrothal, 271 on being assured by him that that was permissible in their community.
She further stated that her relations in law, viz., her father in law, mother in law and sister in law knew about such relations between the parties and about her having conceived prior to the marriage.
She further alleged that she ' flatly refused to carry out abortion and that therefore, at the instance of the appellant, the marriage was performed in Bombay and not at her parents ' place.
She denied that the child born to her was by any person other than the appellant.
Due to her allegation about pre marital sexual relations with the appellant and to her having conceived from such relations, she was required to furnish particulars about the time when, and the place or places where, the parties had sexual relations which she alleged to have led to her preg nancy.
According to the particulars furnished by her, such sexual relations took place about or after Christmas, 1946, and again after about the middle of January 1947.
On the pleadings of the parties, six issues were framed,.
but those relevant for our purpose were: 1.
Whether the respondent was at the time of them marriage pregnant by someone other than the ' petitioner as alleged in para 9 of the petition? 2.
Whether at the time of the marriage the petitioner was ignorant of the aforesaid fact? 3.
Whether the petitioner is entitled to have the marriage declared null and void? The petitioner examined himself and his father.
The respondent examined herself and one other witness.
The documentary evidence adduced by the parties consisted mostly of ' letters written by the petitioner to the respondent and the respondent to the petitioner, since their betrothal, and letters written by other relations of the family to one another.
The trial Court did not accept the allegation of the res pondent about the pre marital sex relations with her husband and held that it was not established that she was pregnant by ' the petitioner.
It also held that she was pregnant at the time of the marriage by some other person, that the petitioner did not know about her pregnancy at the time of the marriage and that he did not cohabit with her after knowing of her being pregnant by someone else at the time of marriage.
On these findings, the petition for annulment of the marriage was allowed.
The respondent preferred an appeal to the High Court. ' The High Court agreed with the trial Court in its finding that the respondent had failed to establish that she was pregnant ' by the petitioner at the time of the marriage, as also regarding 672 he petitioner knowing of her pregnancy at that time.
The learned Judges however held that the petitioner had not proved to their satisfaction that the respondent was pregnant by someone other than the petitioner at the time of the marriage and that the petitioner was not the father of the child which was born and, considering that the trial Court had not framed an issue about there being no marital intercourse between the parties after the petitioner 's knowing that the respondent had been pregnant at the time of the marriage, framed two issues and remitted them to the trial Court for recording findings.
The two issues framed by the High Court were: 1.
Is it proved that the respondent was pregnant at the time of the marriage? 2.
Is it proved that marital intercourse with the consent of the petitioner has not taken place since the discovery by the petitioner of the existence of the grounds for a decree? Thereafter, the trial Court recorded further evidence.
The petitioner, besides examining himself, examined Dr. Champak al, husband of his sister, Madhuben, who was a midwife at the Prantij Municipal Dispensary, Maternity Ward, in 1947 and who attended at the respondent 's confinement and two doctors, Dr. Ajinkya and Dr. Udani as experts.
The respondent, for her part, examined Dr. Mehta as an expert witness,Kachrabai who was a compounder at the Pantij Municipal Dispensary in 1947, Khodidas a Doctor, and herself.
Khodidas did not state anything material to the case.
The trial Court, after considering the fresh evidence recorded by it, found that it was not proved that the respondent was pregnant at the time of marriage.
This was on the first issue framed by the High Court.
On the other issue it recorded a finding that it was proved that no sexual intercourse with the consent of the petitioner took place since the discovery by the petitioner of the existence of the grounds for a decree.
These findings were then submitted to the High Court.
In the High Court, objections were filed by the parties to these findings.
Patel and Gokhale JJ., heard the appeal and delivered separate judgments.
They agreed with the trial Court that it was not proved that the respondent was pregnant at the time of marriage.
Patel J., further held that it was proved that the petitioner had marital intercourse with the respondent subsequent to his discovery of the existence of the grounds for the decree.
Gokhale J., expressed the view that the finding of the trial Court, on this point, appeared to be correct.
In the result, the High Court allowed the respondent 's appeal and dismissed the petition.
It is against this judgment and decree of the High Court that the petitioner has 273 preferred this appeal on a certificate granted by the High Court, under article 133(1)(c) of the Constitution, as already mentioned.
Before dealing in detail with the contentions of the par , ties, we may set down the relevant provisions of the Act, quoting the various sections: 12.
(1) Any marriage solemnized, whether before or after the commencement of this Act, shall be voidable and may be annulled by a decree of nullity on any of the following grounds, namely: (b) that the respondent was at the time of the marriage pregnant by some person other than the petitioner.
(2) Notwithstanding anything contained in sub section (1), no petition for annulling a marriage (b) on the ground specified in clause (d) of sub section (1) shall be entertained unless the court is satisfied (i) that the petitioner was at the time of the marriage ignorant of the facts alleged; (ii) that proceedings have been instituted in the case of a marriage solemnized before the commencement of this Act within one year of such commencement and in the case of marriages solemnized after such commencement within one year from the date of the marriage; and (iii) that marital intercouse with the consent of the petitioner has not taken place since the discovery by the petitioner of the existence of the grounds for a decree." "20. (1) Every petition presented under this Act shall state as distinctly as the nature of the case permits the facts on which the claim to relief is founded and shall also state that there is no collusion between the petitioner and the other party to the marriage.
(2) The statements contained in every petition under this Act shall be verified by the petitioner or some other competent person in the manner required by law for the verification of plaints, and may, at the hearing, be referred to as evidence." 74 "21.
Subject to the other provisions contained in this.
Act and to such rules as the High Court may make in this behalf, all proceedings under this Act shall be regulated, as far as may be, by the Code of Civil Procedure, 1908 (V of 1908)." "23(1) In any proceeding under this Act, whether, defended or not, if the Court is satisfied that (a) any of the grounds for granting relief exists and the petitioner is not in any way taking advantage of his or her own wrong or disability for the purpose of such relief, and (c) the petition is not presented or prosecuted in collusion with the respondent, and (d) there has not been any unnecessary or improper delay in instituting the proceeding, and (e) there is no other legal ground why relief should not be granted, then, and in such a case, but not otherwise, the Court shall decree such relief accordingly." "28.
All decrees and orders made by the Court in any proceeding under this Act shall be enforced in like manner as the decrees and orders of the Court made in the exercise of its original civil jurisdiction are enforced, and may be appealed from under any law for the time being in force; Provided that there shall be no appeal on the subject of costs only.
" It is to be seen that, according to the provisions set out above, statements contained in any petition could be referred to as evidence, the provisions of the Code of Civil Procedure apply to the proceedings under the Act and a Court has to pass a decree in the proceedings only when it is satisfied about certain matters specified in section 23.
Two questions of law raised at the hearing of this appeal may now be disposed of as their determination will govern the consideration of the other matter on record with respect to the revelant points to be decided in the case.
These are: (i) whether the High Court was right in remitting the two issues for a finding to the trial Court and (ii) what is the standard of proof required for the satisfaction of the Court before it can pass a decree in these proceedings.
The High Court had to remit the second issue for a finding as it was necessary for the determination of the case and 275 the trial Court had not framed a specific issue in regard to it.
In the absence of such an issue, the parties could not be expected to have produced evidence directed to that point and therefore the High Court rightly remitted that issue for a finding.
The High Court remitted the first issue as it was of opinion that it was for the petitioner to prove to their satisfac tion, beyond reasonable doubt, which he had failed to do, that the respondent was pregnant at the time of marriage.
He had also to establish that the child could not possibly be born as a result of the petitioner 's marital intercourse with the respondent after the marriage, the learned Judges holding that in these proceedings the Court could not base its decision on the mere admission of parties.
The High Court is certainly right in stating that the peti tioner had, in order to succeed, to prove beyond reasonable doubt that the respondent was pregnant by someone else at the time of marriage.
It is, however, not correct in law in holding that the Court, in these proceedings, could in no circumstances base its decision on an admission of the parties.
On the facts of the present case, however, the decision did not rest on the admissions of the parties alone.
In White vs White(1) this Court construed the expression ,satisfied on the evidence ' in section 14 of the Divorce Act and said at p. 1420: "The important words requiring consideration are satisfied on the evidence '.
These words imply that the duty of the Court is to pronounce a decree if satisfied that the case for the petitioner has been proved but dismiss the petition if not so satisfied. and it has been there held that the evidence must be clear and satisfactory beyond the mere balance of probabilities and conclusive in the sense that it will satisfy . the guarded discretion of a reasonable and just man.
" It approved of the observations in Preston Jones vs Preston Jones(2) to the effect that it would be quite out of keeping with the anxious nature of the provisions to hold that the Court might be 'satisfied ' in respect of a ground for dissolution, with something less than proof beyond reasonable doubt.
The Court further observed at p. 1421: "In a suit based on a matrimonial offence it is not necessary and it is indeed rarely possible to prove the issue by any direct evidence for in very few cases can such proof be obtainable." (1) ; (2) , 417.
276 It follows that what the Court has to see in these proceed ings is whether the petitioner has proved beyond reasonable doubt that the respondent was pregnant by some one else at the time of marriage.
The petitioner has to establish such facts and circumstances which would lead the Court either to believe that the respondent was pregnant at the time of marriage by someone else or to hold that a prudent man would, on those facts and circumstances, be completely satisfied that it was so.
It is true that in divorce cases under the Divorce Act of 1869, the Court usually does not decide merely on the basis of the admissions of the parties.
This is a rule of prudence and not a requirement of law.
That is because parties might make collusive statements admitting allegations against each other in order to gain the common object that both desire, for personal reasons.
A decision on such admissions would be against public policy and is bound to affect not only the parties to the proceedings but also their issues, if any, and the general interest of the society.
Where, however, there is no room for supposing that parties are colluding, there is no reason why admissions of parties should not be treated as evidence just as they are treated in other civil proceedings.
The provisions of the Evidence Act and the Code of Civil Procedure provide for Courts accepting the admissions made by parties and requiring no further proof in support of the facts admitted.
Section 58 of the Evidence Act inter alia provides that no fact need be proved in any proceeding which the parties thereto or their agents agree to admit at the hearing or which by any rule of pleading in force at the time they are deemed to have admitted by their pleading.
Rule 5 of O. VIII, C.P.C., provides that every allegation of fact in the plaint, if not denied specifically or by necessary implication or stated to be not admitted in the pleadings of the defendant, shall be taken to be admitted except as against a person under disability.
Both these provisions, however, vest discretion in the Court to require any fact so admitted to be proved otherwise than by such admission.
Rule 6 of O. XII of the Code allows a party to apply to the Court at any stage of a suit for such judgment or order as upon the admissions of fact made either on the pleadings or otherwise he may be entitled to, and em powers the Court to make such order or give such judgment on the application as it may think just.
There is therefore no good reason for the view that the Court cannot act upon the admissions of the parties in proceedings under the Act.
277 Section 23 of the Act requires the Court to be satisfied on certain matters before it is to pass a decree.
The satisfaction of the Court is to be on the matter on record as it is on that matter that it has to conclude whether a certain fact has been proved or not.
The satisfaction can be based on the ' admissions of the parties.
It can be based on the evidence, oral or documentary, led in the case.
The evidence may be direct or circumstantial.
In Arnold vs Arnold(1) Woodroffe J., said: "In the present case admissions have been proved.
Doubtless, caution is required in cases of divorce to see that there is no collusion and an admission must be examined from this point of view.
But if, as here, there is no reason to suspect collusion an admission may be as cogent evidence i n these as in any other cases.
In Robinson vs Robinson (1859 1 Sw. & Tr. 362), Sir Alexander Cockburnsays: The Divorce Court is at liberty to act and is bound to act on any evidence legally admissible by which the fact of adultery is established.
If, therefore, there is evidence not open to exception of admissions of adultery by the principal respondent, it would be the duty of the Court to act on these admissions although there might be a total absence of all other evidence to support them.
The admission of a party charged with a criminal or wrongful act, has at all times and in all systems of jurisprudence been considered as most cogent and conclusive proof; and if all doubt of its genuineness and sincerity be removed, we see no reason why such a confession should not, as against the party making it, have full effect given to it.
" Reference may also be made to Over vs Over(2).
It was a suit for dissolution of marriage.
The respondent did not appear throughout the proceedings.
The evidence originally consisted of affidavits by the petitioner and his son to prove the letters the respondent had written to the petitioner.
Later, their statements were also recorded.
The letters were held to be sufficient evidence of her having committed adultery.
Sir Lallubhai Shah, Ag.
C. J., observed at p. 255: "I have dealt with this case at some length in view of the difficulty which we have felt on account of there being no other corroborative evidence of the admissions of the wife.
But, having regard to the (1)I.L.R. , 912.
(2)27 B.L.R. 251.
278 circumstances, as disclosed in the evidence, I see no reason to doubt the genuineness of the admission made by the wife, and in the words of Cockburn C. J., it is our duty to act upon such admissions, although there might be a total absence of all other evidence to support them." Marten J., said at p. 261 : "As already stated, I think that such a confession is admissible in evidence, and I agree that there is no rule of law which absolutely precludes the Court from acting upon it.
But as a rule of prudence the practice of the Divorce Courts has been in general not to act upon such confessions, unless corroborated.
The aforesaid rule of prudence loses its importance when certain provisions of the Act enjoin upon the Court to be satisfied with respect to certain matters which would enable the Court to avoid passing a decree on collusive admissions.
Section 12(2)(b) provides that no petition for the annulment of the marriage shall be entertained unless the Court be satisfied that the petitioner was at the time of marriage ignorant of the facts alleged and that no marital intercourse with the consent of the petitioner had taken place since his discovering the existence of the grounds for the decree.
Such a finding necessarily implies that before reaching it the Court has satisfied itself that there had been no connivance of the petitioner in the coming into existence of the ground on which he seeks annulment of the marriage.
Besides, section 23 also provides that the Court can pass a decree only if it is satisfied that any of the grounds for granting relief exists, that the petition is not presented or prosecuted in collusion with the respondent and that there was no legal ground on which the relief claimed could not be granted.
In these circumstances, it would be placing undue restriction on the Court 's power to determine the facts in issue on any particular type of evidence alone, specially when there be no such provision in the Act which would directly prohibit the Court from taking into account the admissions made by the parties in the proceedings.
We are of opinion that in proceedings under the Act the Court can arrive at the satisfaction contemplated by section 23 on the basis of legal evidence in accordance with the provisions of the Evidence Act and that it is quite competent for the Court to arrive at the necessary satisfaction even on the basis of the admissions of the parties alone.
Admissions are to be ignored on grounds of prudence only when the Court, in the circumstances of a case, is of opinion that the admissions of the parties may be collusive.
If there be no ground for such a view, it would be proper for the Court to act on those admissions without forcing the parties to lead other evidence to 279 establish the facts admitted, unless of course the admissions are contradicted by the facts proved or a doubt is created by the proved facts as regards the correctness of the facts admitted.
s The trial Court had recorded a finding on the basis of the statements of the respondent in the written statement, , statements which were supported by her on oath when examined as a witness.
Support for these statements was found from certain circumstances which the Court held established on the basis of the correspondence between the parties and certain oral evidence.
The respondent 's case that the child born to her on August 27, 1947 was begotten by the petitioner as they had intercourse at the relevant time sometime in December 1946 or January 1947, left no room for the Court to consider the new case that that child was conceived sometime after the marriage of the parties on March 10, 1947.
In these circumstances, it was not really right for the High Court to remit an issue to the trial Court for recording a finding on the basis of such further evidence including expert evidence as be led by the parties on the question.
In this connection, the remarks of Lord Simonds in Preston Jones ' case(1) at p. 402, are very pertinent: "Your Lordships would, I think, regard it as undesirable that the burden should be imposed upon litigants in this class of case of adducing evidence of the character which in Gaskill vs Gaskill Lord Birkenhead thought it expedient for the Attorney General to ask for the assistance of the court.
That may be unavoidable where medical evidence in regard to the period is called by the respondent; there is nothing to prevent a case becoming the battle ground of experts.
But I am dealing with such a case as that out of which this appeal arises, in which the substantial issue between the parties was whether the husband had at what was considered the relevant times any opportunity of intercourse with his wife and no question of an abnormal period of gestation had been raised until the trial and then only by the commissioner himself.
" However, as evidence has been led by both the parties and the Courts below have considered it, we do not propose to decide the case on the basis of the evidence originally recorded and would content ourselves by simply stating our view that the High Court might well have decided the case on that basis without remitting the first issue to the trial Court.
We may now deal with some general aspects of the case.
The petitioner has been consistent throughout.
He took the (1) 280 position that he was not the father of the child born to the respondent in August 1947 as the period of gestation between the date of marriage and the date of birth was too short for a mature child to be born.
This does not mean that his case was as has been considered by the Court below that the child born was a fully mature child in the sense that it was born after the normal period of gestation of about 280 days.
He could not have stated so positively as that could not be known to him.
Even the doctors are probably not in a position to state that the child was born after a full period of gestation i.e., after 280 days.
The petitioner 's case was that the child born was not a child whose period of gestation was 171 days from the date of conception or who could be said to be a premature child, but was a child born after almost the full period of gestation.
He steadily stuck to this position.
His conduct and the conduct of his relations from the time they learnt of the respondent 's giving birth to the child had been consistent with this view.
The petitioner had no correspondence or connection with the respondent since he was informed of the birth of the child.
His parents too did not enter into any correspondence with the respondent 's parents.
The peti tioner 's sister Sharda, however, appears to have written just one letter in acknowledgment of the respondent 's sister 's letter conveying the news of the birth of the child.
She has not been examined as a witness.
She appears to have written that letter when she was emotionally happy on the receipt of the news and had not given any thought to the matter.
In 1948, the petitioner instituted a suit for the annulment of the marriage in the Court at Baroda and there too pleaded what he pleaded in the petition giving rise to this appeal.
The respondent, however, put up a different case there.
Any way, that suit was dismissed on the preliminary ground that the petitioner did not have the necessary domicile to institute a suit in that Court.
The respondent, on the other hand, has not been consistent.
In her written statement filed in the Baroda Court she stated that she had become pregnant as a result of the sexual intercourse she had with the petitioner after marriage.
The same line was not adopted in her written statement in this case, in which she admitted that she was pregnant at the time of the marriage, but stated that this was due to sexual intercourse with the petitioner prior to her marriage.
She supported this statement vigorously on oath.
Later, after the close of the petitioner 's evidence, and practically of her statement in examination in chief, she wanted to change her case by an amendment of the written statement to what had been said in the Baroda Court.
This was not allowed by the trial Court.
The High Court too did not allow this formally, but in effect had that point tried by remitting an issue.
281 No good motive was suggested for the petitioner and his parents taking the view so firmly held by them about the child, being not of the petitioner from the very moment they learnt of the birth of the child on August 27, 1947.
Their attitude was not an attitude of mere suspicion in connection with which enquiries and observations could be made.
The attitude was firm from the very beginning.
They did not respond to letters from either the respondent or her father.
What could be the motive for them to take such an attitude? The respondent stated in her written statement: "The petitioner 's father has stayed in Europe for a very long time and holds very advanced views so also the petitioner but this entirely false litigation has been put forward at the instance of the petitioner 's mother who wants to sacrifice the respondent knowing full well the part played by her son the petitioner and the other members of the family.
" Nothing like this was said in her written statement filed in the Court at Baroda.
In her deposition before the findings were called for on the issues, she stated that the relations between herself and her mother in law were not very cordial.
She said in her deposition, after the remission of the issues, that "The parents of the petitioner were not on good term& with my parents as at the time of pheramani the petitioner 's parents were not satisfied with the presents given by my parents.
" This cause for bad relations has not been indicated in any of the letters by the respondent or by the petitioner.
It was not stated in the written statement.
We cannot take this to be a correct statement.
In her letter dated June 11, 1947 she merely stated: ". the nature of my mother in law had become peevish on account of ill health and that I should not take anything to my heart.
Respected papa used to advise me well and had also feelings for me .
She (mother in law) would sometimes become peevish, only and then she herself would feel sorry.
Mamma would speak very highly of me before our neighbours.
" The ordinary usual expressions of disapproval between mothers in law and daughters in law would not lead the rela tions in law to make such accusations against their daughterin law lightly, both on account of notions of family honour and on account of the natural love grand parents would feel towards their grand child.
282 The respondent 's letters prior to the marriage and subse quent thereto indicate her affection for the petitioner and her feeling of being bound by her husband 's desires.
But, in one respect at least, and for no good reasons, she ignored those desires.
We refer to the direction by the petitioner in his letter dated June 22, 1947 asking her to destroy that particular letter and the letters received earlier.
She did not do so.
Why? She has not given any explanation for keeping those letters with her in spite of the directions of the husband to the contrary.
It can be said, in the circumstances of the case, that she was retaining the letters for using them if possible in her defence when any accusation of her having gone wrong prior to the marriage be made against her.
It has been considered by the Court below that the res pondent 's letters to Sharda and her father 's letters to Dr. Champaklal in July 1947 had been suppressed.
It did not believe the statements of Dr. Champaklal that these letters could not be traced.
These persons had no reason to retain those letters.
Two letters of Sushila to Sharda have been produced and their production has been relied upon in sup port of the view that other letters had been deliberately suppressed.
We do not agree with this view.
There was reason to retain these two letters which were sent after the birth of the child and which must have been taken to be letters of some importance as written at a time when it had been realised that the respondent 's relations in law felt that the child born was not of the petitioner.
The main question for determination in this case is whether the child born to the respondent on August 27, 1947 could be the child of the petitioner, who, on the finding of the Courts below which was accepted by learned counsel for the respondent before us, did not cohabit with the respondent earlier than March 10, 1947.
Counting both the days, i.e., March 10 and August 27, the total period between those dates comes to 171 days.
The child born to the respondent is said to have weighed 4 pounds, the delivery being said to be nor mal.
The child survived and is said to be even now alive.
It is not disputed that the usual period of gestation from the date of the first coitus is between 265 and 270 days and that delivery is expected in about 280 days from the first day of the mensturation period prior to a woman conceiving a child.
We shall later be examining the point urged before us by learned counsel for the respondent, as regards the possibility of a living child being delivered after a gestation of this duration, but it is sufficient at this stage to point out that, if the delivery was normal, the child born also normal and alive, it was not suggested that it was possible in the course of nature for such a child being born unless the conception took place long before March 10, 1947.
283 In this connection, reference may again be made to what was said by Lord Simonds in Preston Jones ' case(1) at p. 402, when considering the question whether a normal child born 360 days after the last intercourse of a man and a woman "as the child of that man or not.
He said: "It would, I think, appear a fantastic suggestion to any ordinary man or woman that a normal child born 360 days after the last intercourse of a man and a woman was the child of that man and it is to me repugnant that a court of justice should be so little in accord with the common notions of mankind that it should require evidence to displace fantastic suggestions.
" Of similar effect is the observation of Lord Normand at p. 407, it being: "I have felt great doubt whether the House ought not to say that, though it is not possible to draw the line at an actual number of days, 360 days is too long a period, unless evidence of medical knowledge is adduced by the respondent to show the contrary.
" Lord Morton of Henryton also said, at p. 413: "If a husband proves that a child has been born 360 days after he last had an op portunity of intercourse with his wife, and that the birth was a normal one, and if no expert evidence is called by either side, I am of opinion that the husband has proved his case beyond reasonable doubt." In W. vs W. (No. 4) (2) a similar observation was made by Cairns, J. in proceedings on an application for ordering the wife and child to undergo blood tests in order to furnish evidence that the child was not the petitioner 'section The child was born 195 days after the marriage.
He said: "The marriage was on October 7, 1961.
The child was born on April 19, 1962.
It is, therefore, obvious that the wife was pregnant at the time of the marriage.
" We have then to see whether the evidence on the record is such which would justify the Court 's holding against what it should normally hold on proof of the fact that the child was born after 171 days of the first coitus between the parties.
We shall consider the statements of the doctors relating to different matters when dealing with them.
As doctors Ajinkia and Mehta do not agree on several points we have (2) (1) 284 to decide whose statement should be ordinarily preferred.
We however consider that the Court should not leave the questions undecided merely because the two doctors differ, as has been done, practically, by the learned Judges of the High Court.
Dr. Ajinkia is undoubtedly an expert in the subject of obstetrics and gynaecology.
He took a Master 's degree in midwifery in London in 1937 and passed the F.R.C.S. exami nation in Edinburgh in 1939 in midwifery and gynaecology.
He holds a diploma in child health of London University.
He is a member of the Royal College of Obstetricians and Gynae cologists.
He returned to India in 1939.
He was attached to the Nair Hospital as a specialist.
He was Professer of the Medical College at Agra and was in charge of the Department of Midwifery and Gynaecology from 1942 to 1944.
Since 1949 he was attached to the J. J. Hospital as an Honorary Doctor for Midwifery and Gynaecology and later at the Wadia Maternity Hospital.
He has three maternity homes with 60 beds in all.
He can therefore be rightly called a specialist in midwifery and gynaecology, with an experience of over 20 years.
Dr. Mehta states that he has been practising as a Gynae cologist and Obstetrician since 1926.
His qualifications, however, are much less than those of Dr. Ajinkia and his experience too, as an obstetrician and gynaecologist, is much less.
He has passed the F.R.C.S. Examination in 1906 at Edinburgh.
He was a Police Surgeon for about 10 years during which period he had no special means to acquire knowledge in midwifery, gynaecology or obstetrics.
He was a doctor in the Army for 13 years from 1907 to 1920 and could not possibly have such experience during that period.
He was an Associate Professor in Midwifery at Grant Medical College during 1928 to 1937.
He states that as a professor he was concerned both with giving lectures to students and doing practical work of attending to cases and labour operations.
During this period he was in charge of 6 beds at Motlibai Hospital.
At the time of his deposition he was attached to the Parsee General Hospital and Parsee Lying in Hospital for Women.
He carried on private practice and had three consulting rooms.
He states that most of his cases were gynaecology and midwifery.
Where Dr. Ajinkia and Dr. Mehta differ, we would prefer to rely on Dr. Ajinkia due to his superior qualifications and experience.
We do not consider it material that there exists some slight difference of opinion in matters, not of great significance, between what the doctors state and what is stated in certain well recognized books on the subject, as the statements are on the basis of the theoretical knowledge as modified by 285 their actual experience and what is stated in books is based on conclusions derived from various reports by various doctors working in the field.
Certain facts were urged before the High Court in support of the petitioner 's case.
Mr. Desai, learned counsel for the petitioner, has again submitted them for our consideration.
They are: 1.
The child was born 171 days after marriage and has lived.
It was confirmed by about April 2, 1947, that the respondent was pregnant.
The appearance of the respondent 's belly.
The symptoms of toxemia from which the respondent suffered.
Normal delivery.
Condition and weight of the child.
We shall first deal with points Nos. 2 to 4 which relate to, the respondent 's pregnancy and symptoms of its development at various periods.
The relevant facts are to be determined mainly from the contents of the letters between the parties and between them and some other persons.
Some letters make mention of the health of the respondent and the relevant letters in this respect are of the period April to August 1947.
The parties were, as already stated, married on March 10, 1947.
The respondent remained at the house of her relations in law till about March 27, when she returned to her father 's place at village Prantij.
The first letter from the petitioner to the respondent is dated March 31, 1947 and expresses the hope that she had reached her place hale and hearty.
The next letter from him is dated April 5.
It refers to a letter received from the respondent and indicates that her letter had conveyed the news of her getting some fever and that she had gone to consult a doctor.
Her letter might have also given some indication of her possibly being pregnant as the petitioner asked her to inform him about the opinion of the doctor.
There is nothing in this letter to show that the respondent had informed the petitioner about her suffering from nausea.
The petitioner 's letter dated April 8, 1947 refers to the receipt of a letter from the respondent which probably intimated that she was definitely pregnant, according to the opinion of the doctor, as the letter contains an expression 'knowing that you are pregnant ' and indicates the petitioner 's desire that the child be removed.
286 The respondent 's letter dated April 13, 1947 states: "I am not keeping good health at present, I am still getting fever.
I get vomits also .
But fever does, not leave me and I am not allowed to take food also.
I am bed ridden at present .
Well and good if the child survives and it will be still better if it does not.
" The petitioner 's letter dated April 15 has nothing parti cular in this connection.
On April 17, the parties wrote to each other.
The petitioner 's letter said: "I have been feeling very much anxious as your health is not remaining well.
Write about your health.
If you are not keeping good health and if you are not feeling disposed to come then you remain at your place.
I won 't take it ill at all.
" The respondent 's letter acknowledged the receipt of two, letters of the petitioner, probably of April 8 and April 15, and said: "I am keeping well now.
I have no fever for the last two days.
I am allowed to take light food.
I get two or three vomits in a day.
But I am better than, before.
So, please do not worry.
I will start on the 22nd and reach (there) on the 23rd.
" Her letter of April 20, just intimates about her leaving for Bombay on April 22.
She reached Bombay on April 23 ' and stayed there till the petitioner left for America on April ' 27.
According to the contents of these letters, the respondent suffered from morning sickness of a severe type.
She had fever and several vomits in the day.
In her deposition she stated: "Before I left for Prantij for the first time after my, marriage, I had nausea and vomiting.
When I left for Prantij my health was ordinarily good.
At Prantij I started vomiting.
I consulted a lady doctor at Himatnagar.
After I consulted the doctor at Himatnagar, I came to know that I was preg nant.
" In cross examination she stated: "I had a vomit on the day on which I left for Prantij from Bombay about 17 or 18 days after marriage.
At the time when I had a vomit, I did not suspect or imagine that I was carrying.
I consulted the lady doctor at Himatnagar within two or three days after I reached Prantij.
I told the lady 287 doctor at Himatnagar that I was feeling uneasiness.
I was vomiting and I had no appetite.
The lady doctor examined my body including my abdomen.
As a result of the opinion given by the lady doctor at Himatnagar I intimated to the petitioner that I was pregnant.
" It is contended for the petitioner that such a condition of the respondent could not be on account of pregnancy taking place on or after March 10, 1947.
Morning sickness of such type does not ordinarily take place soon after conception and a doctor cannot, without a biological examination, definitely state that she was pregnant.
Re: morning sickness, Dr. Ajinkia stated that it occurred in the first and second month and expressed agreement with Modi 's statement in his text book on Medical Jurisprudence that nausea or vomiting commences about the beginning of the second month and lasts generally till the end of the fourth month.
It follows that the commencement of the morning sickness at the end of March or the beginning of April 1947 may be possible from the respondent 's conceiving after marriage, but that the severe type of morning sickness, viz., fever and vomiting several times a day should have also developed so early after the conception is rather unlikely in view of what authorities state.
Williams in his 'Obstetrics ' states at p. 275, 12th Edition: "The so called morning sickness of pregnancy, as the name implies, usually comes on in the earlier part of the day and passes off in a few hours, although it occasionally persists longer or may occur at other times.
It usually appears about the end of the first month and disappears spontaneously six or eight weeks later, although some patients suffer from it for a longer period.
" At p. 706 he states: "Nausea and vomiting of mild degree constitute the most common disorder of the first trimester of pregnancy.
About one half of pregnant women complain of some degree of nausea at this time, and, of these, perhaps one third experience some degree of vomiting.
In the present era, however, it is uncommon for nausea and vomiting to progress to a serious extent, that is, to a stage in which systemic effects such as acetonuria and substantial weight loss are produced.
. and the condition is called hyperemesis gravidarum.
" 288 He states at pp.
708 and 709: "The disease varies in degree of severity from nausea and morning sickness to the severe or pernicious type of vomiting which may have a fatal outcome, Usually the condition begins about the sixth week of gestation and abates around the twelfth week." "A small number of these patients develop persistent vomiting, lasting four to eight weeks or longer and resulting in a loss of body weight of 10 to 20 pounds or more.
These patients vomit two, three, or more times a day and may be unable to retain any nourishment by mouth." "In the later stages of the disease rarely seen today a low grade fever frequently develops.
This seldom exceeds 101 degree F but may persist despite adequate hydration." Dugald Baird states at p. 323 of the 7th Edition of the Combined Text Book on Obstetrics and Gynaecology: "Morning sickness occurs in about 50 per cent of women during the early weeks of pregnancy.
In many cases there is only a feeling of nausea, with perhaps the ejection of a mouthful of fluid.
In, others, some partly digested food may be expelled.
In graver cases vomiting may persist throughout the day, and apparently all the ingested food is.
returned.
This latter type is a very serious condition and is described as hyperemesis gravidarum.
It is extremely difficult to draw any hard and fast line between the mor e severe form of morning sickness and a condition which should be labelled as hyperemesis.
As soon as a patient suffering from morning sickness feels nauseated and is sick later in the day, she must be regarded as a mild case of hyperemesis and treated accordingly.
" The respondent does not state about fever and about several vomits in a day in her deposition, but such a condition was expressed in her letters.
The respondent stated in cross examination that when she went to Gamdevi, she continued to, have vomiting, no appetite and uneasiness.
None of the letters written subsequent to April 17 by either party make any mention of this condition continuing.
Champaklal was not questioned about such a condition of hers at Gamdevi.
The petitioner was not questioned and the res pondent does not state that she had nausea and vomiting when at Bombay between April 23 and 27.
She did not have vomit or nausea so long as she was at Bombay in March, though she happened to state in examination in chief that 289 she had a vomit on the day she left.
The petitioner was not questioned about it.
It appears: to be too good to be true, that she suffered from morning sickness of such a type only for a short period of a little over two weeks.
These can be two, possibilities.
Either she did not suffer from any such sickness during that period and just mentioned about it to build up her case regarding the development of pregnancy or that her ' pregnancy was of a longer period at first she may have had ordinary morning sickness which usually consists of a feeling of nausea without any actual vomiting and could therefore be not known to others and that the serious type of actual vomiting and fever developed later in the third or fourth month of pregnancy which would indicate that in April the pregnancy was about four months old and not one month.
We may refer to her first statement in Court.
She then stated : "The petitioner 's father and his sister might be suspicious prior to the marriage that I was pregnant because I was not keeping good health." This may refer to her suffering from morning sickness prior to marriage.
Re: confirmation of pregnancy, Dr. Ajinkia deposed that it was not possible to confirm pregnancy by April 3, 1947 if a woman married on March 10, 1947 had conception subsequent to the wedding, except by performing some special biological test.
Similar is the opinion of Dr. Mehta examined for the respondent.
The Court below attached no importance to the doctor 's telling the respondent that she was pregnant about 3 weeks after she was married, by saying that what was conveyed to the respondent was not a definite diagnosis of pregnancy but only a suspicion about pregnancy as anybody would suspect after a woman 's missing of the monthly course and suffering from morning sickness.
It is not justified in so construing what the respondent stated in Court and what she appeared to have conveyed to the petitioner.
The doctor 's informing her definitely after examination of the body that she was preg nant again points to the fact that her pregnancy noticed in the first few days of April was of a longer duration than that of about 4 weeks.
From Bombay, the respondent went to Gamdevi where the petitioner 's sister Sharda lived and spent a few weeks there.
Letters written in May are not of any importance.
Her letter dated May 12, 1947 to the petitioner is on record.
She L/P(D)ISCI 10 290 expressed her intention to go to Bombay within a few days and to stay there for two months and stated: "Then, when my fifth month (of pregnancy) will be about to be over I will go to Prantij. " There is nothing particular in this letter.
She, however, did not stay at Bombay for two months but left for Prantij before June 4, 1947 for some reason which was possibly not true.
The petitioner wrote letters to her on May 2, 6 and 14.
In his letter of May 2, he says that she must have told about her pregnancy to Sharda and that he, himself had not told anyone about it.
In his letter of May 6 he said: "You tell Sharda that you are pregnant so that Mama can know it.
Consult Sharda about food and reading who will also guide you.
So you should not become anxious at all.
Convey to Champaklal through Sharda so that he may prescribe medicine for you, hence you may not have any trouble ahead.
" In his letter of May 14, he said: "You must be taking good food and I think you must have consulted Champaklal." In his letter dated May 31, he, for the first time, acknow ledges receiving a letter from her.
It must be the letter of May 12, as therein he refers to her intention to go to Bombay from Gamdevi.
There is nothing particular in this letter either.
The petitioner 's first letter to the respondent in June is dated June 3, 1947.
It refers to the receipt of her air mail letter from Bombay after a long time.
It appears that letters of May 12 and May 24 were not sent by air mail.
Her sending a letter by air mail 'on or about May 30 from Bombay indicates that she felt the urgency of communicating something to the petitioner.
The contents of his letter dated June 3 indicate that she had mentioned what she had been suffering from and wanted to leave Bombay for her paternal home.
The letter does not disclose what sort of sufferings there were.
Probably they were due to domestic affairs, as it appears that the relations between the mother in law and the daughter inlaw were not good.
He writes: "If you tell me that I may write a letter to revered mother and father or write a letter to your father to call you at Prantij." Why this urgency? The conditions of living at Bombay could not have been intolerable.
Parents in law would have taken good care of her troubles due to pregnancy.
The urgency of her returning to Prantij could have been due to her feeling 291 that it would be difficult to keep her unduly advanced state of pregnancy a secret for any more appreciable time at Bom bay.
The next letter of June 4 was written by the petitioner, on receipt of the respondent 's letter dated May 24.
This letter too must have been from Bombay, as she appeared to have informed him about the adjoining neighbours talking about them.
Again, it is not clear what was the talk.
The talk might have had reference to their marital relations with particular reference to her pregnant condition, as it is said in the letter: "Let people talk about me and you, but as long as we each have complete confidence over one another which is there to fear for us.
" On June 11, the respondent wrote to the petitioner.
It appears that she returned to Prantij from Bombay on or about June 4, as she said: "A week has passed since I came to Prantij".
She states that she told her mother in law that she wanted to go back to her paternal house, as she was not keeping good health.
There is no reference in this letter to what type of bad health she was keeping.
She makes a significant statement in this letter.
It is: "She (namely the mother) asks me to take away the ornaments, take care of my health and to return in the 7th Month .
I said I did not want to take ornaments because I would have to take care of them on my way." Another statement of hers which is of some significance is: "My health has improved very much.
Blood in my body has very much increased.
" It appears that her excuse to her mother in law for going to her parents ' house was not a true one.
Her reference to im proved health and increase of blood in the body seems to indicate that she was feeling the enlargement of her abdomen.
The contents of this letter were interpreted in some such way by the petitioner who, in his letter dated June 22, wrote in the very second paragraph: "I am asking you what is the month of your pregnancy".
Such a question indicates that lie probably felt surprised at this condition of her abdomen and having studied sex litera ture, as appears from his letters to her, he had his doubts how within such a short period of the marriage the respondent could have such an enlarged abdomen.
This letter contains some very intimate details.
The petitioner asked her to destroy it after she had read it and also to destroy his previous letters.
L/P(D)ISCI 10(a) . 292 Such a suspicion expressed in his letter makes the respondent write a very curt letter on July 2, 1947.
In that letter she said: "How are you to know how many months I have advanced in pregnancy.
I am really so very angry with you today that I cannot understand what I should do with such a man.
Do you not yourself know that you ask me how many months I have advanced in pregnancy.
Calculate (months) in your own mind only.
" In between, the petitioner had written another letter to her on June 27, on receipt of her letter dated June 17.
This letter also contains some significant statements: "Now belly appears big and I feel what kind of baby would be born .
At present I appear very fat.
I do not understand from where so much blood has come. .
This letter was acknowledged by the petitioner by his letter dated June 27.
In this letter again the petitioner wrote: "Please write how many months of pregnancy you have passed".
The letter was comparatively a very formal letter.
On June 28, 1947 the respondent writes to the petitioner in her letter: "I am keeping good health etc .
Now I have to pass only five months .
The belly gives the appearance of a big water pot and one becomes nervous to see it .
A nurse comes to examine me every Sunday.
I had once told her that something was moving in my belly and had asked her as to after how many mont hs these movements must be starting.
She said that my baby to be born would be very healthy because a child would make movements after the fourth month only if it was healthy.
I am very much worried.
If the child would be strong I myself would die.
How then would it be born? .
I go for a walk daily.
I walk two miles one mile while going and one while coming back".
It is clear from this correspondence which passed between the parties in the month of June that the respondent noticed her belly to have enlarged sufficiently between June 11 and June 17, i.e., between the 107th and 114th day, counting from March 10 and adding 14 days to the total, that she had felt the quickening of the foetus sometime before June 28 and that the petitioner had some doubts about her condition being compatible with conception having taken place on or after 293 March 10, 1947.
Patel J., made an error in ignoring the letter of June 17, 1947 and in calculating the days upto June 28 to be 155 instead of 124.
The respondent thus noticed the .enlarged abdomen at the end of the 4th lunar month of pregnancy.
She appears to have felt it before June 16 as she had .spoken about it to the nurse on a Sunday.
The Sundays previous, fell on June 23 and June 16.
It appears that she did not speak on the 23rd as she did not say so in her letter of June 28 and said there: 'I had once told her '.
She must have told the nurse latest on Sunday, June 16.
Two other statements in her letters also tend to indicate that her condition in the beginning of June had been such as probably gave rise to suspicions in the minds of persons about her pregnancy.
These are her statement in the letter dated June 11 that her mother in law asked her to take away all ornaments.
Ordinarily a mother in law would not have liked her daughter in law to take away all her ornaments when she be going to her maternal place for a few months.
Such a request might have been on account of her suspecting that she was in a much more advanced stage of pregnancy, than would 'have been expected in a case of pregnancy subsequent to marriage.
The other statement is in the petitioner 's letter of June 4 referring to her letter of May 24 stating that adjoining neighbours talked about it.
Why should neighbours talk about the petitioner and the respondent prior to May 24, 1947? The talk must have been in connection with her pregnancy and its stage.
The relations between the husband and wife are of no concern to the other people, except when they provide matter for scandal.
This means that her abdomen had enlarged noticeably by May 24 and therefore could indicate to people that her pregnancy was of a duration much larger than of about 74 days, which, on addition of 14 days, would be deemed to be pregnancy of 88 days, i.e., about 3 lunar months.
None of the doctors examined in the case deposes that the enlargement of the abdomen would be of such an extent in 3 calendar months of pregnancy, the period being counted from the first day of the last menstruation previous to the conception.
Dr. Ajinkia states that there cannot be perceptible abdo minal enlargement within 3 months and 7 days of pregnancy in ordinary cases and that such perceptible abdominal enlarge ment would be after the 4th month.
He further states that when a woman is pregnant for the first time, the enlargement might not be visible as late as 5 months, and that a huge abdominal enlargement might occur within 3 months and 18 days of pregnancy in certain complications which, we may mention, do not appear to have occurred in the case of the respondent.
On the other hand, Dr. Mehta states that the enlargement of the abdomen is manifest from the 4th month 294 and in any event will be manifest in the 5th month, even if ' the pregnancy is for the first time.
He did not agree with what Alan Brews states in his 'Manual of Obstetrics ', 1957 Edition, p. 84: ". . enlargement of the abdomen usually does not become manifest to the patient until the uterus rises well above the pubes, and therefore seldom attracts attention until the close of the first half of pregnancy.
A multigravida owing to the laxity of the abdominal wall, usually notices abdominal enlargement earlier than a primigaravida.
" We prefer to rely on Dr. Ajinkia 's statement in this respect.
The respondent felt the quickening of the foetus before June 16, i.e., before the 112th day, or before the end of the fourth lunar month from the first day of the menstrual period prior to conception.
That is too short a period.
Dr. Ajinkia stated that the perceptible foetal movement in a woman pregnant for, the first time does not take place before the 20th week from the date 'of her conception and that the expectant mother begins to feel the movement of the child after the 20th week or end of the 7th month of pregnancy.
He further stated that he would not consider it possible for a woman pregnant for the first time to have a marked perception of foetal movement by the 15th week of conception.
When referred to a statement in Modi 's Medical Jurisprudence to the effect that the first perception of the foetal movement occurred at any time between the 14th and 18th week, Dr. Ajinkia expressed his disagreement and referred to statements in the text book of 'Obstetrics & Gynaecology ' by Dugald Baird, and in Eden & Holland 's 'Manual of ' Obstetrics '.
In the former it is stated: "These are generally first felt about mid term .
The movements are often not felt by primigravidae till the end of the twentieth week while multiparae may recognize them as early as the end of the 16th week.
" In the latter it is stated: "Definite history can be obtained.
Quickening is usually found to occur between the 18th and 20th weeks.
Multiparae from former experience, notice the movements earlier than women pregnant for the first time.
" We are therefore of opinion that the statements by the, respondent in her letters to the petitioner about the enlargement of her abdomen and the quickening of the foetus fits, 295 in with her pregnancy being of a longer duration than one starting on or after March 10, 1947, or notionally starting 14 days earlier.
The only thing said against the pregnancy really having been of a greater duration is that the respondent had her body examined by Dr. Champaklal, husband of Sharda, sister of the petitioner, sometime in May 1947, when she was at Gamdevi.
She states that she had some bleeding and therefore consulted Dr. Champaklal who examined her body including the abdomen.
Dr. Champaklal denies having done so.
The High Court has preferred the statement of the respondent to that Dr. Champaklal, as the petitioner himself had advised the respondent in his letters to consult Champaklal.
There is nothing in the letters of the petitioner which he wrote to the respondent from USA in May 1947 which would indicate that she was to show her body to Champaklal.
He simply advised her to consult him so that she may not have any trouble later on.
This was a general advice and in view of her having suffered from morning sickness in the month of April.
In none of the letters by her or by the petitioner in reply is any reference to her bleeding at Gamdevi and to her showing the body to Dr. Champaklal.
Unless absolutely necessary, Dr. Champaklal would not have examined her abdomen and there is nothing on the record to establish anything so unusual in the condition of the respondent as to persuade Champaklal to examine the body of a close relation of his.
We are not prepared to prefer her statement to that of Champaklal in this respect.
It is true that Dr. Cham paklal does not depose to have noticed anything unusual about her condition.
But that does not mean that her preg nancy was not more advanced than what it would have been if the conception had taken place on March 10, or later.
A male relation is not expected to notice such a condition.
We do not therefore consider any non observation by Champak lal of any such enlargement of the respondent 's abdomen as would indicate her pregnancy to be from a date anterior to March 10, to affect adversely the inferences to be drawn from her own statements in her letters referred to above.
In her letter of January 8, 1948, to Sharda, written long after her delivery, for the first time the respondent mentioned that her body was examined by Dr. Champaklal and that if there had been any deceit in her heart she could not have shown her body to him.
There is no mention of bleeding in this letter which was written over four months after the delivery of the child.
The respondent stated about her bleeding and being ,examined by Dr. Champaklal for the first time in her letter to the petitioner dated February 16, 1948, months after she 296 was delivered of the child and the petitioner had in a way severed his connection with her.
This belated statement is, not sufficient to discredit Champaklal.
The respondent suffered from symptoms of toxemia.
She had blood pressure, passed albumen in urine and had swellings on the body.
According to Dr. Ajinkia, there are two types of toxemia, one appearing in the early months, i.e.,, between the 2nd and 3rd month of pregnancy, and the other from the 7th month onwards, and that in the first case there is severe vomiting, dehydration and jaundice which may result in death due to liver necrosis, while in the latter case there is swelling of the tissues due to water retention.
(oedema), rise of blood pressure, passage of albumen in the urine, headache, disturbance of vision, sometimes culminating in fits.
He further stated that oedema, high blood pressure and passing of albumen in urine may take place in the 4th month of pregnancy in a case of chronic kidney disease suffered by a women previously, but not in other cases.
There is no evidence in the present case that the respondent had suffered from any chronic kidney disease.
Dr. Ajinkia stated that he would call it a severe type of toxemia, if a pregnant woman suffering from oedema all over the body, passing albumen in the urine and having high blood pressure does not respond to treatment.
In cross examination he states that the first type of toxemia does not occur again and again during the period of pregnancy and that it does not appear after the third month, and that if the second type of toxemia appears in the early stage of pregnancy it can be concluded that the woman is suffering from chronic nephritis.
Dr. Mehta states in examination in chief that passage of albumen in urine and oedema usually occur at the second period of pregnancy which he described to be after the 3rd month and before the 7th month of pregnancy, but in cross examination states that these can occur at any time and that it is not the case that these occur only in the last two or three months of pregnancy.
When referred to a passage in Williams on 'Obstetrics ', which contained the statement.
"It is a disease of the last two or three months of ' gestation for the most part and rarely occurs prior to the twenty fourth week.
It is most often seen in young primigravidae.
Pre eclampsia is the fore runner of prodromal stage of eclampsia.
In other words, unless the pre eclamptic process is checked by treatment or by delivery, it is more or less likely that eclampsia (convulsions and coma) will ensue." he said that he agreed with what was stated there.
He argeed with the statement in "Progress in Clinical Obstetrics and 297 Gynaecology" by Lews to the effect that the condition ,appears in between 3 and 10 per cent of pregnancies, gen erally later than the thirty second week.
He also agreed with the statement in British Obstetric and Gynaecological Practice by Holland, 11 Edition, P. 256: "In the majority of cases of pre eclampsia signs of the disease do not appear until after mid term and in the majority not until after the thirtieth week of pregnancy." He agreed with what was stated in Dugald Baird 's Combined Text Book of Obstetrics & Gynaecology, 6th Edition, to Ike effect: "Sometime about the thirtieth week of pregnancy the patient, most commonly a primigravida, will be found to have some elevation of blood pressure and she may have noticed some puffiness of her ankles and hands.
After the lapse of days or a week or two, the blood pressure may rise further and albumen, often not more than a trace, can be demonstrated in the urine.
There may be a progressive rise in the blood pressure and oedema becomes more marked.
In severe cases the face, abdominal wall and libia are effected.
" It is thus clear that this type of severe toxemia which results in increased blood pressure, passing of ablumen in urine and swelling of the body appears in the later stages of pregnancy and not usually before the end of the 6th month, i.e., not during the period of 168 days of pregnancy, that is to say, not to take place before August 10, 1947 in the case of the respondent who was married on March 10, even if for the purpose of duration 14 days are added to the period following March 10.
The respondent stated in the examination in chief that when she went to Prantij from Bombay, which was about the 4th of June 1947, she had swelling on her feet, hands and face.
In cross examination she further stated that she had swelling over these parts and also high blood pressure in June and that the passing of albumen and swelling of hands and feet continued till delivery but there was no high bloodpressure at the time of delivery.
The Court below did not act on the statement of the respondent about her having the symptoms of toxemia in the month of June as none of the letters on record written in June makes reference to such a condition of hers.
This is true, but that does not necessarily mean that she did not have such symptoms in the month of June.
They might not have been very severe that month and the severity appeared in the month of July.
Letters on record amply make out that she was suffering from a severe type 298 of toxemia in July.
It has been urged for the respondent in connection with her alleged toxemic condition in the month of June that her statement in her letter dated June 28 about her walking 2 miles a day is not compatible with her state ment in Court and the suggestion for the petitioner that she was suffering from toxemia in the month of June.
The statements of the respondent in her letters can be used against her as her admissions, but cannot be used in her favour accepting them to be correct statements.
If she was pregnant at the time of marriage she must take such steps up to the time of delivery as to allay the suspicion that she had been really pregnant at the time of marriage.
She may therefore be inclined to make wrong statements in her letters to prepare for any plausible explanation when the delivery took place before the expected time on the basis of her conception after marriage.
There is therefore no reason not to believe her statement that she did have such trouble of a milder kind in the month of June.
Severe trouble does not usually come at once.
It develops from a mild stage.
By June 4, 1947, the duration of pregnancy, if.
due to coitus on or after March 10, can be at most 100 days, a little over 3 1/8 lunar months, and according to the medical opinion, toxemia in the form of blood pressure, oedema and passing of albumen in urine does not occur after such a short period of pregnancy.
It is to be concluded that by the end of May the duration of her pregnancy was of about 6 months.
This fits in with the petitioner 's contention that she was pregnant on March 10, when the marriage took place.
A brief reference to the correspondence which shows that she was suffering from toxemia from the month of June 1947 may be made now.
The first letter in this connection is dated July 12, 1947.
It is Champaklal 's letter to Kodarlal, father of the respondent, and was written on receipt of the respondent 's letter addressed to Sharda.
The respondent must have written that letter on or about July 10.
Champaklal expresses worry on having the news about her health.
He states: "It is not a good sign if she has oedema on the legs and abdomen in passing the urine, and hence you keep Sushilabehn immediately under the treatment of a doctor either in Ahmedabad or at Bombay.
Dr. Pandya at Ahmedabad is also a good doctor. continue the medicine as long as she advises.
You can consult her and then inform us immediately.
" Sharda had herself written to the respondent on July 13, 1947 suggesting that she should go to Bombay for consultation about her health.
Champaklal again wrote to 299 Koderlal on July 20, after receipt of letter from him and stated : "The medicine prescribed by Dr. Pandya is proper and I am sure that there will be complete cure.
Follow her advice as regards medicine and food directions.
If she has given advice for her not.
taking salt do follow it and if advised to live entirely on fruits and milk do follow the same because if proper care is not taken for this disease there will be epileptic fits at the time of child birth and the case will be serious.
Your doctor has warned you from now by examining the urine and it is good that you have taken a warning and you have taken good precautions from now and hence I am sure that she will definitely improve.
" Champaklal 's letter dated July 28, again on receipt of a letter from the respondent 's father, asks the latter to in form him as to how the respondent 's oedema stands.
On July 24, the respondent 's father wrote to the peti tioner 's father stating therein: "My daughter Sushilaben was got examined by Miss Pandya and her opinion is that she is passing albumen in her urine and that she is suffering from blood pressure.
Her health is good.
This is all.
" Manilal, the petitioner 's father replies to this letter on July 27 and writes: "Very pleased to learn that Sushilabai has been 'shown ' to the doctor and the medicine has been continued and that she is keeping good health.
Very pleased to learn that you and the members of your family are keeping well.
Here we all of us are keeping well, so much".
With affection of Manilal 's Jai Gopal.
" The letter in a way, is a cold one.
He has not stated what would have been both an expression of his feeling at the time and would also have been very polite in the circum stances.
He expressed no concern and did not write that he be informed about the respondent 's condition from time to time just as Champaklal happened to write in each of his letters.
It is to be noted, however, that both Kodarlal and Manilal use language which could not have been correct factually.
Kodarlal says her health is good ' and Manilal expresses his pleasure on receipt of the letter.
300 The respondent 's letter dated July 2, 1947 was the only letter written to the petitioner in the month of July.
No other letter is on the record and the petitioner states in his letter dated July 27 that he had not received any letter from her for a long time and was therefore very much worried.
The petitioner wrote to the respondent on August 6, 1947 stating that he was awaiting her letter and that Champaklal and Sharda had informed him that her health was very bad and she was not in a position to write a letter.
He asks for further news of her health by wire.
It is his letter dated August 12, 1947 which makes a reference to the respondent 's letter dated August 4 which he thought was received after about a month of her previous letter.
Thus it is clear that for about a month between July 2 and August 4, 1947, the respondent 's condition was such that she was not even able to write a letter.
It was when her condition had become very bad that news of her ill health was conveyed to Sharda by letter on or about July 10.
The last letter which the respondent writes to the peti tioner is dated August 13.
In this letter she writes: "As my health was very bad, a letter was sent to Shardaben and my father also wrote a letter to Champaklal.
At that time he had written that Dr. (Miss) Pandya would be called in and treatment by her would be started; so we are taking her the treatment by her accordingly.
We did not write to you for the simple reason that that would have caused you anxiety.
The treatment is still continued.
But there is no change.
There are swellings all over my body and I am feeling extremely weak.
Consequently, I have not even the strength to write a letter.
We had consulted Miss Pandya and Dr. De Monte and Doctor Anklesaria at Ahmedabad.
So according to them poison is passing in the urine and along with it there is also the blood pressure and so it is likely that the case may be serious case of delivery and I might get convulsions at that time.
That is why, right from now they have altogether stopped me from taking salt and they have also stopped me taking food, so as to avoid the rise of blood pressure.
I am on the diet of mere milk and fruit.
Also my medicines are continued.
My dear, the exertions of writing even this much are causing a severe giddiness in my head and so I now stop.
" 301 As a post script to this letter she had further written: "They are attending all right on me here.
Possibly, they are going to take me to Ahmedabad or.
Bombay, for the delivery, because in a village ' like this, there is not sufficient equipment available.
" The petitioner 's letter dated August 25, 1947 makes reference to the letter from the respondent 's sister dated August 17.
The respondent 's letter dated August 13 is a very good synopsis of her condition and of the reasons for not inform ing the petitioner of her ill health.
It is clear from this letter that Shardaben was informed in about the first week of July only when her health had deteriorated to a large extent as she said in the letter that a letter was sent to Shardaben as her health was very bad.
Kodarlal informed Manilal even later,.
on July 24.
There is therefore no reason not to accept the respondent 's statement on oath that she had suffered from blood pressure, swellings and passing of albumen in the urine in the month of June and that she had oedema on her legs, ankle and feet when she left Bombay for Prantij on or about June 4, 1947.
The doctors who examined her and whose names are given in her letter dated August 13, have not been examined.
No explanation has been given for not examining Dr. De Monte and Dr. Anklesaria.
It is said that Miss Pandya refused to appear as a witness as she had not kept notes about the respondent 's condition, remembered nothing about it and would not be able to depose anything in Court.
We do not consider this to be a good explanation for not calling a relevant witness.
Under the stress of oath and cross exami nation Dr. Pandya might have recollected things which could have a bearing on the case.
Madhuben, the nurse examined for the petitioner, deposed about the respondent 's condition and that is not much different from what the respondent her self stated in Court and in her letters.
Madhuben states in this connection: "About two months before the date of the delivery of the respondent I was called at the house of Sushilabai.
At that time I had examined Sushilabai.
At that time I noticed that there was swelling over the hands and feet of Sushilabai.
I also noticed that Sushilabai was weak in her health and she had trouble about the passing of the urine.
Her urine was examined.
It was noticed that she was passing albumen in urine.
At the 302 time when I examined Sushilabai at her house, she had the 7th month.
She was not taking proper food.
" As the delivery took place on August 27, Madhuben was describing the respondent 's condition in about the last week of June.
She has been disbelieved for remembering this con dition of the respondent as she was not expected to remember this after such a lapse of time.
We see no reason to disbe lieve her when the respondent herself admits her suffering from these symptoms of toxemia.
If Madhuben concluded from these symptoms that the respondent was in the 7th month of her pregnancy, there is nothing to be surprised at that, as, according to the medical opinion already discussed, such symptoms do not appear before the 7th month.
Madhuben deposes that she used to visit the respondent at intervals of 8 or 10 days during those two months.
The respondent denies that Madhuben ever attended on her except at the time of her delivery.
According to her, a lady doctor of Himat nagar used to look her up every Sunday.
This lady doctor has not been examined.
It is alleged that she had left the place and her address could not be known.
The respondent said in her letter to the petitioner, dated June 28, 1947: "A nurse comes to examine (me) every Sunday".
There is some dispute about the word 'nurse '.
The original word in Gujarati was 'bai '.
The correctness of the official translation of that word does not appear to be questioned before the trial Court or in the grounds of appeal to the High Court.
We see no reason to disbelieve Madhuben 's statement which, so far as the condition of the respondent goes, finds support from what the respondent herself states and also from the medical opinion about the stage of preg nancy when the symptoms observed by her occur.
The respondent 's letter dated August 13, 1947 indicates the extreme severity of the toxemic condition she was in at that time.
Doctors were contemplating the possibility of the respondent 's suffering from convulsions at the time of de livery and therefore of moving her to Ahmedabad or Bombay where there was sufficient equipment to deal with a compli cated case of delivery.
Now, we may consider the expected condition of the child, born after 171 days of conception, as a result of the respondent 's suffering from mild toxemia for about a month and thereafter from severe toxemia for about 8 weeks prior to delivery.
With respect to the effects of toxemia from which a mother suffers, on the expected baby, Dr. Ajinkia states that if toxemia starts at the end of the 4th month of pregnancy 303 and in spite of the treatment there is no change in toxemia for a period of 7 weeks thereafter, the condition of the child delivered 169 days after the marriage would most probably be a still birth.
Dr. Mehta states that the effect of toxemia in the mother, speaking generally, is that the baby will be under sized and feeble, though if toxemia be 'of a short duration, the baby may not be affected.
He, however, states that toxemia starting at the end of the 4th month of pregnancy and showing no change in spite of treatment for a period of 7 weeks thereafter, would result either in the child 's dying in the womb or in being delivered of on a premature date.
The respondent 's suffering from toxemia for about 2 1/2 months at least prior to the delivery and from a very severe type of toxemia for about 7 weeks before the delivery, according to the medical opinion, would be an important factor in reducing the weight of the child born.
There was nothing in the progress of the pregnancy of the respondent which could be conducive to the increase in weight of the foetus which would result from conception on or after March 10.
A child born of a mother, who had so suffered from toxemia, after the full period of gestation can be 4 lbs.
but a child born of such a mother after a period of 171 or 185 days of gestation cannot be 4 lbs.
and will be less than 2 lbs.
In fact, according to the medical opinion, the child born in such circumstances, should have been either dead already, or one which would die soon after delivery.
The High Court relied on the statement of Dr. Mehta that though Such is the normal expectation, certain children may survive on account of their ' inherent vitality.
We do not think that an extremely premature baby born of a mother who had suffered from severe toxemia has any chance of having such inherent vitality.
The delivery took place at the Prantij Municipal Dispensary, Maternity Ward.
Madhuben, witness No. 2 for the petitioner.
was working as a mid wife at the hospital and had attended to the delivery of the respondent.
She states that she had weighed the child and it weighed 4 or 4 1/2 pounds, that it was a mature child which was born after the expiry of the full period of gestation and that the child was a normal one.
Her statement finds support from Exhibit K, one of the in door case papers relating to the respondent at the hospital.
Madhuben states that Kachrabhai, the compounder, made entries in this paper under her instructions.
Exhibit K, as printed, shows that the portion of the column under 'disease ' was torn.
We have seen the original and could clearly read the word 'normal ' and the other word may be 304 either 'labour ', as stated by Madhuben, or 'delivery '.
It records. 'Female child, weight 4 pounds '.
The details noted about the interval between the starting of the labour pains and the delivery do not indicate that there was anything abnormal.
Kacherabai, the compounder, was examined by the respondent as witness No. 2.
According to him, a white paper known as 'the maternity card ' is also prepared along with the brown paper, which Exhibit K is, and that the white paper which must have accompanied Exhibit K was missing from the record.
A photo copy of the pro forma white paper was taken on record.
It requires entries about previous obstetric history and various other matters observed at the time of admission of a maternity case.
There is no reason to suppose that the relevant white paper was removed from the records by the petitioner or by someone at his instance and that it contained matters which would show the entries in Exhibit K to be wrong or the statement of Madhuben to be inaccurate.
Kachrabai states that all the records at the hospital remain in the custody of the Doctor, that they are kept under lock and key, that the key remains with the doctor or with him and that they were the only two responsible persons in the dispensary.
he has also stated that in the file there were some other brown papers also for which there were no corresponding white papers and that he did not charge the petitioner with the removal of any white paper from this file and that it was no fault of the petitioner if any white paper was not on the file.
He has also proved the entry with respect to the respondent 's delivery in the Maternity Admission Register.
The entry is Exhibit 15.
It also mentions the weight of the child to be 4 lbs.
It has a 'dash ' in the column for 'conditions of the child '.
Kacherabai states that this 'dash ' meant that the condition was good.
A 'dash ' which is found in the column 'still born, miscarriage, abortion ' cannot mean 'good '.
'Dash ' in the column of 'condition of child ' may mean 'good ' as deposed to by Kacherabai.
Any way, it must mean that there was nothing particular to note about the condition of the baby.
Gokhale J., accepted Mahuben 's statement about the weight of the baby and its condition but did not accept the statement that the baby was born after a full period of gestation.
He considered the delivery to be premature.
Patel J., considered Madhuben to be unreliable, assumed the weight of the baby to be 4 lbs.
and accepted the res pondent 's statement about the condition of the baby and its being born premature.
Patel J. remarked, in meeting the submission for the peti tioner that Madhuben was living at Vrindaban and was leading a pious life and had no reason to make untrue statements 305 that sometimes such persons might be bigoted and narrow minded.
He did not believe her statement that the child was kept on glucose for two days in accordance with the practice ' followed in the Prantij Hospital, as normally mother 's milk is available only after two days after the birth of the child.
The statement is said to be contrary to those of most of the standard books referred to by the experts on behalf of the parties.
Madhuben was not questioned about it and we have not been referred to any statement to the contrary in any book on the subject.
He did not rely on the entry about the condition of the child as the various entries in Exhibit 17 showed that the condition of children weighing 3 lbs.
or 4 lbs.
or 6 lbs.
was similarly noted.
The description of the condition of a child as good, need not have a necessary relation with the weight of the child born.
It is to be noted that, according to the entries in the Maternity Admission Register, Exhibit 17, most of the children born in the Prantij Hospital weighed 4 lbs.
or less.
The condition of all the children could not have been such as to require special mention.
It may, however, be pointed out that no entry in Exhibit 17 shows the weight of the child to be 6 lbs.
Patel J., suspected the genuineness of the entries in the hospital records as he mis read Kacherabai 's statement and so erroneously thought that the hurry with which the papers were produced by the Doctor raised some suspicion.
Kacherabai, the compounder, examined for the respondent on May 7, 1950, stated: "Doctor has returned to Prantij yesterday.
He had gone to attend some marriage about 3 or 4 days ago." Patel J., however, happened to mis read this statement and observed, in dealing with the question of normal delivery, "Keshavbhai (Kacherabai?), the witness of the respondent, the compounder, said that the doctor left only a day before his giving evidence, i.e. he, left on the 6th.
The hurry with which the papers were produced by the doctor may raise some suspicion.
" The fact is that Dr. Modi who was attached to the Prantij Municipal Dispensary in May 1959 was present in Court on May 2, 1959 to produce the documents summoned from him.
He was not in a position to be present in Court between 3rd and 6th May on account of a marriage which was to take place on May 4.
He, therefore, filed an affidavit that day stating the facts and requesting the Court to excuse his absence from Monday, May 4, 1959, till the morning of Thurs 306 day, May 7, and expressing his readiness to leave the records in the custody of the Court or such other person as the Court directed.
The order sheet of the trial Court dated May 2, 1959shows that the petitioner 's counsel requested the Court to take the papers in its custody as the Doctor had come with the relevant papers.
Counsel for the respondent had no objec tion.
The records came in the custody of the Court in this.
Patel J., says: "The white paper in respect of the respondent is missing.
The petitioner and his advisers had the first glimpse of the hospital record in connection with this case if any one had it and it is a mystery that the white paper should disappear.
" The order sheet of May 2, 1959 shows that counsel for the; petitioner had tendered in Court Entry No. 63 for the year 1947, i.e., Exhibit J. and indoor case papers of the respondent, Exhibit K.
It adds: "Shri Mehta says that Dr. Modi (the doctor at the Prantij Municipal Dispensary who produced Exs. J & K) does not know of his personal (knowledge) and he is producing the records (maintained) in the ordinary course of business.
Mr. Shah (counsel for the respondent) has no objection.
" It appears that Dr. Modi did not file in Court any white paper.
There is no evidence that the petitioner had the first glimpse of the hospital record and this is clear from the learned Judges using the expression 'if anyone had it '.
The petitioner is not to blame for the missing of the white paper.
When the learned Judge suspected the bonafides of Dr. Modi and the petitioner in connection with the missing of the white paper relating to the respondent 's delivery and was to base a finding on such a suspicion, he should have summoned Dr. Modi and examined him in that connection and should not have left the matter by a mere observation: 'The doctor who produced it could not be cross examined, as he produced the papers in a hurry '.
We should, however, point out that what transpired when Exhibits J & K were produced gave no room for the comment made by the learned Judge.
Patel J., was further of opinion that it was not expected of Madhuben to remember the condition of the child after so many years of the event and because the respondent herself described the condition of the child very much differently and the latter could be expected to have better reasons for remembering its condition than the mid wife.
We may quote the statements of the respondent and Madhuben about the condition of the child.
The respondent said: "The child born to me was a very weak one.
It was a very.
small one.
She was not in a position to cry at 307 the time of her birth.
She did not cry for two days after her birth.
Her eyes were closed.
There were, no hair on her head.
She had no nails on her fingers and toes.
She was not able to suck my milk.
She was reddish in colour.
As the baby was unable to suck my milk, milk was pumped out.
That, milk was thrown away.
The baby was given glucose and brandy.
12 or 13 days after delivery the baby was able to feed from the breast.
" Madhuben said: "After the delivery Sushilabai appeared to be weak but the child was normal.
It was crying.
The movement of the limbs was normal.
The eyes of the child were open and the child was taking glucose.
The cries of the child indicated that the child was a healthy one." "At the time of the delivery of Sushilabai, Dr. Chimanlal was not present.
No other doctor or nurse was called at the time of Sushilabai 's delivery.
I alone attended to the delivery of Sushilabai.
" Madhuben was not cross examined regarding her statement about the condition of the child and the respondent 's version about the condition of the child was not put to her.
The only explanation suggested for this omission has been that the respondent herself was not present in Court that day and therefore could not have instructed the counsel in that regard.
The explanation is feeble.
The respondent was in Bombay on the day Madhuben was examined.
She must have known that Madhuben had been summoned for evidence on that particular day and if she did not attend the Court that day it must have been with a purpose.
A party has to give instructions to his counsel in good time and has not to put that off till the actual date of hearing.
Madhuben was questioned as to how she remembered these facts and stated that during the proceedings of the case at Baroda, somebody had made enquiries from her and therefore she was reminded of the respondent 's delivery.
This too must have happened in 1.948.
It appears to us that the reason for her remembering the details of the respondent 's delivery could be the very fact which is the matter in issue in this case.
The respondent belonged to a respectable family of the place which is not a large one.
The date or at least the month of the marriage would be known in the locality.
The delivery took place within an unusually short period of the marriage.
It appears that people of the locality talked about it.
In these circumstances, Madhuben could have recollected of this particular delivery when questioned about it.
308 It is very difficult for a witness to state on oath why he remembers a certain fact which took place long ago and the witness therefore makes his best to answer it at the spur of the moment.
We do not consider the long period lapsing between the delivery and Madhuben 's statement in Court sufficient to justify ignoring her statement or consider her to be an unreliable witness when there is no reason for her to depose falsely, nor the fact that she stayed at the place of Manilal, fattier of the petitioner, in Bombay when she came to give evidence sufficient to discredit her.
She went to Bombay from Vrindaban where she had been residing after she gave up service and bad been living the life of a devotee.
It is true that a mother is not likely to forget the condition of the child born to her, but the value of the respondent 's statement depends on her veracity.
Both the trial Court and the High Court in their judgements held her to be an unreliable witness.
Patel J., relies on her statement only so far as it is about the condition of the child.
We do not consider her statement about the condition of the child born to her to be worth reliance.
She describes this condition to be practically exactly what ought to be the condition of a child after a period of gestation amounting to 171 days.
The description given by her exactly fits in with the details of the descriptions found in text books on obstetrics.
She was examined after the doctors examined for the petitioner and for her had made their statements.
Apart from this, she could know from other sources what condition a baby born after that period of gestation should have and could therefore mould her statement accordingly.
Before the remand of the issues by the High Court, it was not her case that the child was born prematurely or that its condition was such as would have been the condition of a child born after that period of gestation.
If the condition described now was the real condition of the child born, there could have been no reason for her to think that her true story of having conceived by her husband after the marriage might not be accepted by the Court.
She could have doubts about it only when the condition of the child did not fit in with the expected condition of a child born after that period of gestation.
If the condition of the child was such as described by her, there was no reason why Madhuben would not have given instructions about the condition to the compounder, for noting in the Hospital records.
That was not the normal condition of the child born, be it after the full expiry of the usual period of gestation or after almost the full period of gestation.
There is no difference in the statements of the doctors examined in the case with respect to the care and attention necessary to be given to a baby born after such a period of gestation.
The respondent was in the hospital till September 8, 309 1947.
She states that great care was taken of the child, but if that extreme care was taken, there would have been some note about it in the hospital records and that itself would have been a very good reason for Madhuben to remember about the. , child 's condition.
We see no reason why Madhuben be not believed when the available hospital records support her.
She has no reason to depose falsely.
In these circumstances, we are of opinion that Patel J., was in error in preferring the statement of the respondent to that of Madhuben.
The weight of a child born, is again a factor which tends to support the statement of Madhuben about the condition of the child and goes against the statement of the respondent.
The child weighed 4 lbs.
Again, there is no difference in the opinion of the doctors examined for the parties that the weight of a child born at about the 6th month of pregnancy would be about 2 pounds.
Such a statement is borne out from what is noted in the various books on that subject.
We see no reason to doubt the statement of Madhuben about the weight of that child.
The entries in Exhibits K and 15 support it.
We do not see any reason to disbelieve the statement of Madhuben that the child was a mature child.
The normal weight of a child born after the full period of gestation is, said to be 6 to 7 pounds, according to Dr. Ajinkia and 5 to 7 pounds, according to Dr. Mehta, but the weight of a normal child depends upon various circumstances.
In this connection, it is worth noticing that Exhibit 17 contains entries about 35 cases of births at the Prantij Hospital between December, 1942 and August 1952, about which Kacherabai was questioned by the respondent 's counsel in the examination inchief.
Out of these the majority of children weighed less than 4 lbs.
Only one weighed 5 lbs.
, one 4 lbs.
and 8 ounces, and twelve weighed 4 lbs.
Only one out of them appears to have died.
It can be taken that the normal weight of the children born at this hospital is about 4 lbs.
It is too much to expect that all these were cases of premature deliveries.
It should not therefore be a matter for surprise and for disbelieving Madhuben when she states that the child born to the respondent was a mature child born after the expiry of the full period of gestation.
Of course, her statement cannot be taken to be literally correct.
What it amounts to is that the child was born after practically the full period of gestation and was definitely not a child born in the 6th or 7th month of pregnancy.
There had been some difference of opinion between Dr. Ajinkia and Dr. Mehta examined for the petitioner and the respondent respectively, about the definition of 'normal labour ' or 'normal delivery '.
Both are agreed with what the 310 expression 'labour ' means.
Dr. Ajinkia states that normal labour would mean a series of processes by which the mature or almost mature products of conception are expelled from the mother 's body and referred to, in this connection, the definition of 'labour ' in Williams ' 'Obstetrics ', 10th Edition, p. 324.
Dr. Mehta agrees with the definition but would not associate maturity or almost maturity of the child with the expression 'normal labour ' and would restrict that expression to mean labour during which no artificial means are used.
He had to admit later that labour has connection with maturity.
When questioned whether normal labour could be compatible with premature birth, Dr. Mehta stated in examination inchief : "It may be termed as a normal labour, but one specifies the term that it was a. premature one.
" We are inclined to prefer Dr. Ajinkia 's view on this point.
However, nothing, much turns on it in view of, our opinion about the weight of the child born and the weight being consistent with the weight of a child born after almost a full period of gestation, as would be discussed later.
We, therefore, accept as true the statement of Madhuben and hold that the child born to the respondent on August 27, 1947 was after normal labour and weighed 4 lbs.
We also believe her statement that it was a mature child and had been born after almost a full period of gestation for reasons we now state.
We now deal with the question whether the child born after 171 days of marriage could survive and live for years, and if so, whether the respondent 's child was born premature or after almost the full period of gestation and refer to what Dr. Ajinkia and Dr. Mehta had said in this connection Dr. Ajinkia states that if special care is taken at the time of delivery and also in the treatment of a child prematurely born at the 28th week of conception, then it may survive.
The special care he refers to is not just giving more attention to the baby by the relations, but of a particular type.
He has described the special care to be taken in the process of delivery and the care required after the delivery.
During the delivery the special care required is in regard to the following matters: 1.
The labour should not be allowed to be prolonged.
As soon as the baby is delivered, its temperature should be maintained.
Oxygen should be given to the child, by special incubators.
Some respiratory and circulatory stimulants will also be required.
Baby will be required to be handled very gently.
Since its resistance to fight infection is low, all the care is taken to prevent infection.
The care required after delivery is in these respects: 1.
Maintenance of warmth.
Maintenance of proper nourishment.
Prevention of cyanotic attacks by giving oxygen.
Prevention of infection as stated before.
The respondent remained in the hospital for about 12 days till September 8.
Madhuben does not state of any such care being taken either during the delivery or afterwards.
In fact.
the hospital did not have the requisite equipment.
Madhuben has stated that abnormal cases of delivery were not attended to at the hospital.
Dr. Ajinkia further deposed that in his opinion even with the skilled care, a child born within the 7th calendar month cannot survive, and in this he is not fully supported by what Taylor states at p. 32 in his 'Principles & Practice of Medical Jurisprudence ', 11th Edn., Vol.
II: "In the absence of any skilled care Hunter 's dictum on the unlikelihood of survival when born before the 7th calendar month remains as true as it was.
" There cannot be any positive definite statement in these matters by any one including a doctor and especially when there have been exceptional cases of whatever veracity men tioned in medical books.
Possibly there had been no such case in the personal experience of Dr. Ajinkia where a child born before the 7th calendar month survived in spite of the care given to the child presumably at the hospital.
Dr. Mehta states that lie had not applied his mind to the question whether a child born after 169 or 171 days after conception would be born alive, but had applied his mind on the footing of 184 days counted from the first day of the last menstruation.
He was not, therefore, in a position to challenge the statement of Dr. Ajinkia that a child born after 169 days from the date of conception would be born dead.
Williams, in his book on Obstetrics, states at p. 186 that at the end of the 6th month, the foetus weighs about 600 grains and a foetus born at this period would attempt to breath, but almost always perishes within a short time.
He further states that in the 7th month the foetus attains a weight of about 1,000 grams and that a foetus born at this time moves its feet quite energetically and cries with a weak voice and as.
312 a rule it cannot be reared, but occasionally expert care is rewarded by a, successful outcome.
Williams, however, states that generally speaking the length affords a more accurate criterion of the age of the focus than its weight.
The weight of the child, however, is a good index of the period of gestation, though it is not as good and accurate as the length of the child born.
The baby 's weight of 4 lbs.
at birth is not consistent with its being born after a gestation period of 185 days.
It is, therefore, reasonable to conclude that the child born to the respondent and weighing 4 lbs.
was not a child born on the 6th or 7th month of pregnancy.
This supports Dr. Ajinkia 's statement.
Madhuben does not state that the child was weak.
The respondent states so.
We do not believe her.
Reference to certain letters may be made in this connection.
Tile respondent 's sister sent a letter to Sharda on August 27 or 28 to which Sharda replied on August 3 1.
It appears from Sharda 's letter that the respondent 's sister 's letter had said that the health of the respondent as well as of the baby was good.
The sister 's letter does not, in any way, convey the information that the baby was very weak and of such a condition as is now described by the respondent.
On August 30, the respondent 's father sent a telegram to the petitioner and said that both the respondent and the baby were well.
On September 3, seven days after the birth of the child, Koderlal sends a letter to the petitioner.
It is in this letter that he states: "After I had been to Marwar, our daughter Sushila has given birth to a daughter prematurely on 27th August 1947, at 'about 10 A.M. in the morning . . and the health of both is very well Intimation has been given to your father by wire and through letter but there is no reply from him." This letter was written after the petitioner 's parents had not responded in any way except by showing extreme indifference to the news of the birth of a grandchild.
That, along with local gossip, must have put Koderlal on guard and even then he does not write anything with respect to the extremely weak condition of the child and simply states that the delivery was premature.
Sushila also writes to Sharda, on the same day, i.e., September 3.
She was still in the hospital and ordinarily the mother of a baby 6 or 7 days old would not have written a letter to anyone.
She writes in this letter: "The health of myself, and my baby is all right.
The baby is very weak Two letters and a telegram about the birth of the baby were sent to the respected Mamma, but there is no reply at all from the respected Pappa.
Hence, all here are 313 very much worried as to why there is no reply from the 'Vevai ' (in laws) even to the telegram.
And as I did not keep good health, the baby was born prematurely before the full period which of course is a matter over which the Almighty has dispensation.
I do not know what idea he (PappaVevai) must be entertaining about me.
To whom, but to you, can I write?. .
A telegram was sent to London to your brother, informing him about the birth of the baby but God knows why there is no reply from him.
" The contents of this letter tend to confirm what we have said in connection with the letter of the respondent 's father to the petitioner.
The respondent and her people had a definite feeling that the petitioner and his people were not responding to the communications probably on account of the idea that the child born was not the petitioner 's child.
The respondent indirectly gave expression to such a feeling by saying that she did not know what idea her father in law was entertaining about her.
Any way, her letter does not state in what respect the baby was very weak.
The expression that the baby was weak in no way conveys the idea that the baby 's condition was such as has been now described by the respondent.
For a baby of mature period, the respondent 's child was certainly weak, but for a baby born after a period of about 6 months ' gestation, the baby born was not weak at all.
The respondent sends a letter to the petitioner on December 22.
She expresses her grievance at not being informed first of the petitioner 's return to the country, and states, "No one can be a match for nature; God alone stands for truth.
Please forgive my mistakes if any.
" These expressions also make out that she was fully conscious by this time that the indifference of her husband towards her was on account of the feeling that the child born was not his.
Still in this letter she does not give a full picture of the condition of the child born to her in order to impress the correctness of her implied statement that the child was really of the petitioner.
That was the time when she and her people, could have placed facts and evidence in the form of either statements from the doctors or references to the doctors to whom the petitioner could refer for such information which could have supported the respondent 's assertion.
When no reply was received to this letter, it was then that the respondent wrote a letter to Sharda on January 8, 1948 and over a month later to the petitioner on February 16, 1948.
314 Reference has been made to these letters earlier in connection with the allegation that Champaklal had examined the respondent 's body in May 1947.
In her letter to Sharda, she is more explicit than what she was in her letter to the petitioner on December 27.
She said: "Hence I open out my heart to you this very day (and say) that I am absolutely innocent.
I was in M.C. about ten days before the marriage It did not occur to me, even in my dream, that an accusation of such a roguery would be brought against me .
To throw such an infamy on a person coming of a respectable family would indeed be the limit; Behen: You are kind and please think full well over this matter and bring it to end.
As to whether it is your child or not, well, you may see it and satisfy yourself as to whether or not its appearance and features tally (with yours).
" It is clear now, from this letter that she was fully con scious of the accusation against her, conveyed through silence if not through letters.
Yet, in this letter, except for asserting her innocence, she does not come out with the facts about the condition of the baby and the extreme care taken by her.
She wrote in similar strain to tier husband on February 16, and stated in that letter: "I was keeping weak health and was suffering from blood pressure and only on account of that the delivery has taken place earlier It is, therefore only the feeling of revenge entertained by the persons who have poisoned your ears towards me and the members of my family.
Further, if I were at fault and if I wanted to hide something from you then I would not have taken proper care of the child who was and is still weak due to its premature birth and consequently it would have died and I would have told (you) that there was some thing like miscarriage.
But as my conscience was clear and as I had trust in you I took proper care of it and brought about improvement in its health.
It may well be that as you have not known me fully that you have got suspicious.
But if you live with me you will be convinced that out of jealousy and revenge an absolutely false charge has been put on an innocent woman.
" It is for the first time in this letter that something is said of taking proper care of the child who was weak.
Even in this letter she had not given a description of the condition of the 315 child at the time of its birth a condition which would have sufficed to convey the idea that the child born was really am, child of about 6 months ' pregnancy.
The letters of the respondent and her relations subsequent to the birth of the child do not bear out the respondent 's statement about the condition of the child at the time of its birth and.
therefore, do not in any way discredit the statement of Madhuben about the condition of the child born and its weight.
True that there had been instances of children born after a comparatively short period of gestation and that they had survived a few for some years too.
But such cases are few and it may be open to doubt whether the period of gestation reported was absolutely correct.
In this connection we may refer to Table No. 2 at p. 560 of 'British Obstetric & Gynaecological Practice ' by Holland & Bourne, 11 Edn., which relates to Total Consecutive Births, Male, Classified by Birth Weight & Gestation Time.
It also mentions still births and neo natal deaths among them.
It appears from this table that out of 7,037 cases of births, there were 3 births i.e., .043 per cent with a gestation period between about 155 and 175 days, that all those three were cases of still births or neo natal deaths and that the weight of each child was 1 lb.
or so.
There were 4 births i.e. 057 per cent with a gestation period between 170 and 185 days.
All the four of them, were cases of still births and neo natal deaths.
Only one of them weighed 6 lbs.
Two weighed 2 lbs.
each and one weighed 1 lb. 13 i.e., .19 per cent were births with a period of gestation between 185 and 200 days.
12 of them were cases of still births and neo natal deaths.
Only two weighed 5 lbs.
each, one of them surviving; one weighed 4 lbs.
Three weighed 3 lbs.
Six weighed 2 lbs.
each and one weighed 1 lb.
Dr. Mehta states that a baby born 169 days after conception would weigh between 1 1/2 and 2 lbs.
A child whose weight at birth is 4 lbs.
might in rare cases be a full term baby, but ordinarily it was taken to be a premature baby, according to him.
and a 4 lbs.
full term baby was a rare occurrence.
The learned Judges considered the delivery premature on account of the respondent suffering from toxemia.
We do not agree.
Dr. Ajinkia states that a premature delivery is one which takes place between the 28th week and the 40th week from the date of conception and that miscarriage means the expulsion of the product of conception before the 28th week of con ception.
He has also stated that the shorter the period of gestation, the more feeble would be the child and fewer would be the hours of its survival, while a child born out of miscarriage could not survive even with special care because it 316 was not a viable child.
By viable he meant that the child has been sufficiently developed to continue separate existence from the mother.
He is emphatic that a child could not be viable even before the 28th week, say 25th or 26th week.
Dr. Mehta, on the other hand, states that a child is sup posed to be normally viable about the 28th week, that there can be exceptions and a child might be viable before the 28th week and could be born alive and could survive.
He said that he made this statement on the basis of knowledge which he had acquired from the standard books and referred to three cases mentioned in De Lee 's Book.
Dr. Mehta has further stated with respect to premature deliveries that premature delivery could be before the 28th week.
At first he stated that he could not say how long before such a delivery could be, but when pressed in cross examination he stated that a 20 weeks ' foetus, if ejected alive or dead from the body of a woman it would be a premature birth.
He admitted that abortion was different from premature delivery and also stated that if the delivery took place before the 28th week it was termed either miscarriage or abortion, but added that if the child born was a viable child, then such a delivery would be called a premature delivery.
He could not contradict Dr. Ajinkia 's statement that a child born after 169 days from the date of conception would be born dead.
We may refer to what is stated about premature termination of pregnancy in British Obstetric Practice by Holland, at pp.
559 561, 2nd Edition: "Premature termination of pregnancy may be defined as termination of the pregnancy after the twentyeighth week (accepted date of viability of the foetus) and before the fortieth week, counting from the first day of the last menstrual period.
On the other hand, most writers on the subject of prematurity tend to define the condition in terms of the weight of the baby rather than in terms of the maturity of the pregnancy.
It was first laid down by the American Academy of Pediatrics in 1935 that a premature infant is one that weighs 5 1/2 lb.
(2,500 gm) or less, regardless of the period of gestation.
This definition was accepted by the International Medical Committee of the League of Nations and has gained universal acceptance, in spite of its scientific inaccuracy.
Most obstetricians have seen babies of less than 5 1/2 lb.
born after a gestation period of more than 280 days.
Indeed, birth weight and duration of pregnancy are far from perfectly correlated.
Infants weighing less than 5 1/2 lb.
at birth may even be post mature.
This 317 is well shown in Table 2 constructed by Kane and Penrose from 7,037 live births from University College Hospital records.
It is seen that 470 babies weighed less than 5 1/2 lb., but that III (23.6 per cent) of these under weight babies were born at term or later, according to the ordinary method of calculation.
The term immaturity has been suggested as an alternative in view of these discrepancies, but it has not received universal acceptance.
There is, however, more than academic significance in the difference because maturity as such, irrespective of weight, is of the greatest importance in relation to foetal survival.
A baby whose birth weight is 4 lb., if born at thirty eight weeks stands a far better chance of survival, and is more likely to develop into a healthy child, both mentally and physically, than one of the same weight born a month earlier.
" What has been said above about the viability of a child or its premature birth is with respect to a child born of a mother whose pregnancy progressed normally.
The chances of survival of a baby born, of a mother who had suffered from severe toxemia for about two months prior to the delivery, are bound to be much less and would be further less if no special care is taken during delivery and thereafter.
The weight of the respondent 's baby, its condition at birth and its having lived as a mature child born after full period of gestation does, together with the other circumstances connected with the progress of the pregnancy, amply support the petitioner 's case that the child born to the respondent could not be of the petitioner.
We have been referred to several cases in which the question about a child being conceived from the husband or not arose.
Suffice it to say that cases fall into two categories.
One where delivery takes place much more than 280 days after the husband had last opportunity to cohabit with his wife and the other where it takes place much earlier than 280 days from the first day of menstruation prior to conception.
The first type of cases, to which reference need not be made, involve the determination of the question as to the period it took for a sperm to fertilize the ovum.
Nothing precise about the period was known when cases prior to the decision of Preston Jones ' case(1) came up for consideration.
It was considered to vary much and so children born so long as 349 days after the known period of cohabitation were held to be legitimate, as not proved to be the results of adultery.
No such question however arises in the other type of cases as the decision is to be given on the assumption that there had been fertilisation on the first day possible for the coitus between the husband and wife.
The question to determine in such cases is (1)(1951) A.C. 391.
318 whether the short period of gestation would justify the con clusion that the child was born of conception from that coitus or was born as a result of some other sexual relations between the woman and someone prior to that coitus between the husband and wife.
One such case was Clark vs Clark(1) on which much reliance has been placed by the Court below.
In this divorce case, on the petition of the husband there was no evidence of misconduct on the part of the wife and the only evidence of adultery was the fact of the birth of a child the period of gestation of which, assuming the husband to be the father, could not have exceeded 174 days.
The child lived, and,.
at tile date of the hearing was about 3 years old.
The medical evidence was to the effect that a child of so short a period of foetal life would not survive for more than day or two.
In view of tile fact that the date of conception could be fixed very rarely, it was considered that the periods of gestation generally spoken of were notional periods and that therefore where the (late of conception could be fixed and thus the actual period of gestation be ascertained, such period was comparable to the longer notional period and consequently a six months ' child might be comparable to what was called a 7 months ' child.
The facts of that case were very much different from the present case and must have naturally influenced the view that a six months ' child be comparable to a 7 months ' child.
The Court considered the allegation of the husband who lived quite close to where the wife lived for about a year after the delivery, that the child when born was a fully developed 9 months ' child, grotesque.
The Court believed the evidence of the nurse with 30 years ' experience that the child born was one of the two most extreme cases of premature births she had seen.
The wife 's mother deposed about the condition of the child which corresponded to a child born after 174 days of the conception.
The Court believed the statement of the mother of the child.
The lower limbs of the child were in irons even about 3 year& after its birth.
Tile delivery was hastened on account of an accident.
The mother of the child had fallen a day earlier.
The weight of the child, though noted as 3 1/2 lbs.
was not more.
than 2 1/2 lbs., as the former weight included the weight of the towel.
The notional period of pregnancy is calculated from the first day of the menstruation preceding the conception and it is on this account that 14 days are added to the period of pregnancy from the actual date of conception.
On the basis of notional calculation, the fully mature child is born after 280 days.
On the basis of the date of conception, the child is born (1) [1939] 2 All E.P. 59.
319 between 265 and 2 '70 days.
The development of the foetus undoubtedly depends on its age as counted from the date of conception and it is for this reason that the books on Obstetrics mostly deal with the development of the foetus on the basis of, days or weeks after conception, for a period of about 2 months and thereafter they begin to note its development with respect, to the end of the 3rd and consecutive months.
This must be due to the fact that by that time a difference of about a fortnight in the period of gestation does not bring about a substantial difference in tile description of the development of the foetus.
After all, the entire knowledge with respect to the development of the foetus with respect to the period of gestation is based on a consideration of a large number of cases and then arriving at some generalized conclusion about the develop ment of the foetus corresponding to its age from the date of conception.
It would not therefore be very correct to add 1 lunar month to the ascertained period of gestation in cases of a known date of conception merely on the ground that when books speak of a foetus of a certain number of months that foetus might be due to a conception taking place on any day of the lunar month corresponding to the menstruation prior to the conception and the miss period after conception.
In the present case, however, it is known that the earliest ,date for conception can be March 10, 1947.
It is the statement of the respondent herself that about 10 days prior to the marriage she had her monthly course.
It is clear therefore that the notional period of pregnancy in the present case cannot execeed the period from March 10 by more than 10 days.
This means that the notional period of gestation of the respondent 's child cannot be more than 181 days.
We have, however, considered the case on the footing of 185 days which is equal to the period between March 10 and August 27 (both days inclusive) plus 14 days.
There can therefore be no justification in the present case to consider that the respondent 's child, though of 171 days ' gestation after conception, if it be taken to be conceived on March 10, could be notionally equivalent to an age of 171 days plus 28 days, i.e., 199 days.
We are therefore of opinion that Clark 's case(1) cannot be a good guide, both on facts and law, for the determination of the question before us about the legitimacy of the respon dent 's child.
It may be mentioned that Clark 's case(1) was distinguished in Guardianship of Infants Act, 1886 & 1925.
In re.
and In re. section B. an Infant.(2)B. vs B. where it was held that a period of 188 days is too short to be accepted in law as a period of :gestation on the ground that in Clark 's case(3) the child was (1) (2) 1949(1) Ch.
320 not held to be a fully developed nine months ' child but was held, in view of the evidence of the experienced mid wife, to be an extreme case of premature birth.
It was said at P. 110: "There is, as I have said, no such evidence of prematurity here, and it would be straining the facts to assume that the birth was the result of intercourse that took place only 188 days previously.
" It is true that no allegation of any kind has been made about the respondent 's general immorality or about her mis conducting with someone at the time when the child born to her could be conceived.
The mere fact that her character in general is not challenged does not suffice to rebut the conclusion arrived at from the various circumstances already discussed.
The only question before us is whether on the evidence led it is possible for the petitioner to be the father of the child.
The facts and matters we have set out earlier clearly establish that the conception to produce a child of the type delivered must have taken place before March, 10, 1947, and if, as is now the case, the petitioner 's first sexual contact with the respondent was on March 10, 1947, it follows that the respondent was pregnant by someone other than the petitioner at the time of her marriage.
The respondent, in her letter dated February 16, 1948 to her husband said: "Further, you know that one has to insult wicked persons in order to remain chaste.
Therefore those wicked persons who have been insulted are ready to take revenge.
Hence it is only out of jealousy that they poison your ears.
" If this statement is correct, it shows that persons in her village had evil eyes on her and that she had to reject their advances.
We may also now mention certain other circumstances on which the respondent relied to show that however unusual it might be, the child born to her was by the petitioner 's marital intercourse with her after their wedding.
They are: 1.
Reluctance of the respondent to meet even the petitioner before the marriage though the engagement continued for a period of two years and she loved him.
Suggestion to break off the engagement as late as January and February.
Reluctance to abort the child.
Symptoms of vomiting and nausea immediately after the miss of period.
321 5.
The fact that Champaklal, the brother in law of the petitioner did not notice the pregnancy of the respondent which would be sure to have far advanced if the allegation were true, though she lived with him,, and was examined by him.
She stayed up to the end of May at Vile Parle in the house of the petitioner 's father and yet the pregnancy was not noticed.
The progress of pregnancy from the beginning which was consistent only with pregnancy by marriage.
The child being very weak and under weight.
Sudden delivery.
The first circumstance can only indicate that she was moral and did not want to have any irregular connection with the petitioner prior to the marriage.
The petitioner has not challenged her character.
A good general character does not necessarily mean that nobody could have had sexual inter course with her even by force, a possibility indicated by her letter just quoted.
The second circumstance urged is that if she had become pregnant, she could have accepted the suggestion of breaking off the engagement when the petitioner had been expressing his dissatisfaction at his engagement with her.
She could not have been very independent about it.
The engagement was brought about by the parents of the parties though, possibly, with the implied or express consent of theirs.
Breaking off the engagement might have led to scandals.
She wrote to the petitioner in her letter dated May, 15, 1946 that people asked her as to why marriage was not taking place.
A betrothal period of about 2 years is ordinarily a long period, when the parties were of marriageable age.
So this circumstance, again, is of no force.
The third circumstance about her reluctance to abort the child, again, is not of any value.
Abortion, as suggested by the petitioner in his letters of April 5 and 8, too would have led to complications and scandal and it could not have been certain that the abortion would not disclose the longer age of the foetus than what it ought to have been if it was of a connection after the marriage.
We have already dealt with the symptoms of nausea and vomiting appearing immediately after the first miss of the period and ceasing suddenly about the middle of April and held that they appeared to be more consistent with the peti tioner 's case than with the respondent 'section L/P(D) ISCI 11 322 We have also dealt with the possibility of Champaklal 'section observing the stage of her pregnancy when she was at Gamdevi in the month of May and have held that he could not possibly have noticed it.
It is true that there is no evidence that her parents in law noticed during her stay at Bombay, from about the middle of May to June 4, that she was in an unduly advanced stage of pregnancy.
Reference has already been made to the implica tion of the statement in her letter that her mother in law asked her to take all the ornaments with her when she was leaving, for her paternal place on or about June 4.
We have also referred to a letter of her father in law ex pressing no surprise and showing coldness on his part on learning of her condition in the last week of July 1947 and to persons talking about her and the petitioner by May 24, 1947.
It is therefore not possible to say that the advanced stage of pregnancy wits not noticed when she was at Bombay in the month of May.
We have already dealt with the progress of the pregnancy and.
need not say anything more in that connection.
It is not established that the child was very weak and was under weight.
The last circumstance urged on behalf of the respondent.
is the fact of sudden delivery.
The only circumstance alleged in this regard is that her father was not at Prantij on August 27.
Koderlal stated in his letter to the petitioner on September 3 that after lie had been to Marwar their daughter Sushila had given birth to a daughter.
If this statement, as translated, is correct, it shows that Koderlal had returned from his visit to Marwar and not that the delivery took place when he was away from Prantij.
The respondent 's bare statement that her father was not in the village that day, therefore, does not suffice to lead to the conclusion that the delivery was sudden and that no arrangements had.
been made for the delivery and that the delivery did take place after six months of pregnancy.
Further, a sudden delivery need not be a delivery of the six months ' child.
It may be a delivery sometime before the ex pected date.
Even in such a case, no particular arrangements for the confinement might be made by the relations.
We have already referred to the respondent 's statement in her letter dated August 13, 1947 that the doctors were contemplating arrangements for the respondent 's confinement in view of expected delivery, be it on account of the normally expected time of delivery approaching or of expecting an early delivery on account of the toxemic condition of the respondent.
She said in that letter that they were going to take her to Ahmedabad or Bombay for the delivery since in a village like hers there was not sufficient equipment available.
It cannot therefore be said that the delivery was so sudden as to bear out the.
323 respondent 's case that the delivery took place when she bad just completed 6 months of pregnancy.
On the basis of the evidence discussed above and the pro babilities of the case, we are of opinion that the child born to,, the respondent on August 27, 1947 was practically a mature child and weighed 4 lbs in weight and that therefore it could not have been the result of a conception taking place on or after March 10, 1947.
It follows that it was conceived prior .to
March 10 and that therefore the respondent was pregnant at the time of marriage.
Lastly, we may refer to sections 112 and 114 of the Evidence Act.
Section 114 provides that the Court may presume the existence of any fact which it thinks likely to have happened, regard being had to the common course of natural events, human conduct and public and private business in their relation to facts of the particular case.
The conclusion we have arrived at about the child born to the respondent being not the child of the appellant, fits in with the presumption to be drawn in accordance with the provisions of this section.
People in general consider that the child born, being of a gestation period of 185 days, cannot be a fairly mature baby and cannot survive like a normal child.
Medical opinion, as it exists today and as is disclosed by text books on Obstetrics and Gynaecology, however, refer to some rare exceptions of livebirths even with a gestation period of a few days less than 180 days.
But we have not found it possible to accept the respondent 's case of the conception having taken place from and after March 10, 1947 for several reasons which we have explained in detail at the relevant place.
We should observe that in the case before us the earliest date on which conception through the husband could have taken place is fixed with certainty, a matter which could not be said of the freak cases referred to in medical literature, for in them the earliest date of conception was a matter of guess or inference.
Besides, we have the feature in the present case, of evidence regarding the various phenomena and bodily changes attending on pregnancy at different stages of its course, and the combined effect of these does preclude any argument of a conception on or after March 10, 1947.
Lastly, we have definite evidence, oral and documentary, of the condition of the child at birth which is wholly inconsistent with a gestation of less than six months ' duration, assuming that a live birth and the child healthy enough to survive is possible with such short duration of pregnancy.
In passing, we might add that we consider it probable that it was because the physical condition of the child at birth approximated to a normal mature child, that the respondent originally put forward a case of pre marital intercourse with the husband a story she could not sustain and which she ultimately abandoned.
1/P(D)ISCI 11 324 Section 112 of the Evidence Act provides that the fact that any person was born during the continuance of a valid marriage between his mother and any man shall be conclusive proof that he is the legitimate son of that man, unless it can be shown that the parties to the marriage had no access to each other at any time when he could have been begotten.
The question of the legitimacy of the child born to the res pondent does not directly arise in this case, though the conclusion we have reached is certain to affect the legitimacy of the respondent 's daughter.
However, the fact that she was born during the continuance of the valid marriage between the parties cannot be taken to be conclusive proof of her being a legitimate daughter of the appellant, as the various circumstances dealt with by us above, establish that she must have begotten sometime earlier than March 10, 1947, and as it has been found by the Courts below, and the finding has not been questioned here before us.
that the appellant had no access to the respondent at the relevant time.
It has been found by the Courts below that the petitioner had no sexual intercourse with the respondent prior to mar riage on March 10.
This finding has not been challenged be fore us and appears to us to be well founded.
The only con clusion is that the respondent was pregnant at the time of marriage by someone other than the petitioner.
The next question to determine is whether the petitioner had marital intercourse with the respondent after he had dis covered that she was pregnant at the time of marriage by someone other than himself.
The trial Court found that the petitioner did not have such intercourse after he had discovered about the respondent being pregnant at the time of marriage.
Patel J., did not agree with that finding.
Gokhale J., considered the view of the trial Court to be correct.
The petitioner states that he discovered the respondent being pregnant at the time of marriage by another person when he learnt of her delivering the child on August 27, 1.947 and when be felt that could not be his child.
He has further stated that since his return from abroad he had no intercourse with her and that is not disputed.
The respondent admits it.
There is no evidence to the contrary either.
The last marital intercourse the petitioner bad with his wife was at Bombay, before he left for abroad.
That was between April 23 and 27.
The question then is whether he could have known during those days about the respondent 's being pregnant at the time of marriage.
The respondent does not state at that time she had such ostensible symptoms which could have led the petitioner discover that she bad been pregnant at the time of marriage.
The opinion of the experts on 325 this point is not very decisive.
Dr. Ajinkia has stated in crossexamination that ordinarily the petitioner should have been aware about the respondent 's condition who was in advanced pregnancy when he had coitus with her on April 26 when the foetus would have been 157 days old on the assumption ' that it had started its life i.e., the ovum had fertilised on ember 20, 1946.
He however added that it would not be possible for the petitioner to detect that the respondent was pregnant if the coitus took place in darkness.
He further stated that the woman who is pregnant for the first time has her abdominal tissues so tense that a non medical.
person coming into contact by act of coitus might not be able to detect the enlargement of the abdomen.
A husband, without having medical knowledge, can feel abdominal enlargement without any difficulty during coitus only when the pregnancy is advanced above 6 months.
Dr. Mehta, stated in examination in chief that a man having Coitus with his wife 157 days after pregnancy begins, would immediately know about her being in a fairly advanced stage of pregnancy and added in answer to the Court 's question that he would not know that she had been pregnant for 157 days but only know that she was merely pregnant.
When asked by the respondent 's counsel whether the, husband would or would not have noticed the difference between 1 1/2 months ' pregnancy and pregnancy of 5 months and 17 days he replied that the husband would not notice a pregnancy of 1 1/2 months ' but would certainly notice 5 1/2 months ' pregnancy.
We consider these statements to be of no help in coming to a finding on the point whether the petitioner could discover on April 26 that his wife was not only pregnant but was pregnant from some day much earlier than the tenth day of March 1947 when they were married.
Neither of the two doc tors was questioned as to whether the petitioner could have known that his wife 's pregnancy was of more than 1 1/2 months ' duration, and, unless the petitioner knew that, he could not be said to have discovered on April 26 that the respondent had been pregnant by someone else at the time of marriage, irrespective of the fact whether the coitus that night took place in darkness or in light.
In this connection, we may again refer to what Williams says in his 'Obstetrics ', 12th Edition, at p. 270 : "It should also be borne in mind, that the abdomen changes its shape materially according as the woman is in the upright or horizontal position, being much less prominent when she is lying down.
" We may also say that the mere fact that the petitioner alleges that the respondent gave birth to the child after a full 326 period of gestation, does not actually mean that the child was born after such a period.
The petitioner could not have known when the child was conceived.
By that statement he simply expresses his view, based on the fact that a fairly mature child was born on August 27, 1947 though the marriage had taken place on March 10.
The fact that the child born to the respondent was a mature baby does not mean that it was conceived on November 20, 1946.
We have already indicated that the weight of the child and the surrounding circumstances could only indicate that the child was born after almost the usual period of gestation, though it could not be said that it must have been conceived 280 days earlier.
We therefore hold that the petitioner did not have marital intercourse with the respondent after he had discovered that she had been pregnant by someone else at the time of marriage.
We have already said that there is no collusion between the parties.
The petitioner filed the petition within time.
There is no legal ground which would justify refusing the petitioner a decree for declaring the marriage between the parties to be null and void.
We therefore allow the appeal, set aside the decree of the Court below and annul the marriage between the parties by a decree of nullity.
We direct the parties to bear their own costs throughout.
MUDHOLKAR, J I regret my inability to agree with the judgment proposed by my brother, Raghubar Dayal, J.
The appeal arises out of a petition for divorce instituted by the appellant on April 18, 1956 in the City Civil Court of Bombay against his wife, the respondent under s.12(1) (d) of the .
The petition was decreed by the City Civil Court, but on appeal, the High Court dismissed it.
Certain broad facts which are not in dispute are briefly these: The appellant is a resident of Bombay, while the res pondent 's father was a resident of Prantij in the former State of Baroda.
They were betrothed to each other in June or July, 1945, and their marriage was celebrated at Bombay according to Hindu rites on March 10, 1947.
Thereafter, the couple lived together as husband and wife for a short while, and the respondent then went to her parents ' house at Prantij where she stayed till the third week of April, 1947.
During her stay there she wrote to her husband informing him that she was in the family way.
The appellant was to leave for the United States in connection with the family business, and, therefore, the respondent returned to Bombay towards the end of April of 327 that year.
The husband and wife admittedly had martial relations during this visit of the respondent to Bombay.
After them appellant 's departure.
for the United States, the respondent stayed with the appellant 's father for a few days, and thereafter at Gamdevi in the hous of the appellant 's sister, Sharda and her husband.
She stayed there for about four weeks, and then again returned to her father in law 's house at Vile Parle.
From the correspondence between the parties, it appears that the respondent and her mother in law were not getting on well, and the appellant, therefore, advised her to arrange for her return to her father 's house as early as she could manage it.
In pursuance of this, the respondent returned to her father 's house along with some one who had been sent by her father to fetch her.
There was considerable correspondence between the parties subsequent to this until August 27, 1947, on which date the respondent gave birth to a female child at Prantij.
Information about this was communicated telegraphically as well as by a letter to the appellant 's father and also to the appellant himself.
According to the appellant, he was shocked when he learnt that the child was born to the respondent only 5 months and 17 days after their marriage, and he suspected that this child had been conceived before the marriage through some one else.
After his return to India in November, 1947 he instituted a suit in a Baroda Court for the annulment of the marriage under the Baroda State Divorce Act, but that suit, which was defended on merits by the respondent, was dismissed by the Baroda Court on the ground of want of jurisdiction.
The came into force on May 18, 1955.
Under this Act, it was competent to a person, though married prior to the commencement of the Act, to apply for divorce upon certain grounds including those set out in s.12((1)(d) within one year of the commencement of the Act.
Availing himself of this provision, the appellant preferred a petition, out of which this appeal arises.
In the petition the appellant made allegations against the respondent to the effect that the child born to her was conceived by her through a person other than himself, and that she was actually in the family way before the marriage, of which fact he was not aware at that time.
In her written statement the respondent denied these allegations.
She stated that after their betrothal she succumbed to the entreaties and representations made by the appellant and permitted him to have sex relations with her, and that as a result of this, she had conceived from him.
She further averred that the appellant, his sister and her husband were all aware of this before the marriage, and thus no fraud had been practised upon the appellant and the members of his family by her.
It may be mentioned that such a plea was not taken by the respondent in the written 328 statement which she had filed in the proceedings, which bad been instituted in the Baroda Court.
In her evidence, however, she has confined her averment only to having had sex relations with the appellant before the marriage, and stated that she was not aware at the time of the marriage that she was pregnant.
She added that she came to know of her pregnancy only when she started vomiting, which was after her return to Prantij subsequent to the marriage.
She has not repeated in her evidence the allegations that the appellant or any members of the family were aware of the fact of her pregnancy before the marriage.
Upon the pleadings of the parties, the City Civil Court raised the following six issues: "(1) Whether the Respondent at the time of the marriage was pregnant by some one other than the Petitioner as alleged in para 9 of the Petition '? (2) Whether at the time of the marriage the petitioner was ignorant of the aforesaid fact? (3) Whether the petition is not maintainable for the reasons alleged in para 2 of written statement? (4) Whether the Petitioner 's claim in the petition is barred by the Law of Limitation for the reasons alleged in paras 3 and 4 of the written statement? (5) Whether the Petitioner is entitled to have the marriage declared null and void? (6) To what relief the petitioner is entitled?" The Court answered issues (1), (2) and (5) in the affirma tive, and issues 3 and 4 in negative, and granted a decree to the appellant in terms of the prayer in the plaint.
When the matter went up in appeal before the High Court, the two learned Judges.
Gokhale and Patel, JJ.
who heard it did not feel satisfied that the appellant had proved that the respondent was pregnant by some one other than the appel lant, and that the appellant was not the father of the child which was born to the respondent.
In his judgment, Patel, J. observed : "The question then is whether we should dismiss the petition on this ground.
As mentioned before the evidence is not decisive of the pregnancy of the respondent before her marriage.
The effect of a decree of nullity might be very serious to the child who is living and who is now 10 years old as also to the respondents.
" Gokhale, J. expressed his agreement generally with the view taken by Patel, J, and after pointing out the necessity of obtaining on record expert evidence, said that the case should be sent down to the trial Court to record a finding as to whether 329 it was proved that the respondent was pregnant at the time of marriage.
Accordingly, the following two issues were framed by the High Court and the case was remitted to the City Civil Court for recording a finding: 1.
Is it proved that the respondent was pregnant at the time of the marriage? 2.
Is it proved that marital intercourse with the consent of the petitioner has not taken place since the discovery by the petitioner of the existence of the grounds for a decree ?".
It may be mentioned that Mr. Amin, who appeared for the present appellant, contended that a great injustice would be done to him if these issues were required to be determined now.
His objection was, however, overruled by the Court.
Patel, J. pointing out that it would be the respondent who would be in greater difficulty, as her father was dead, and the Munim who was attending to the affairs of the family was dead, and the doctor, who attended on her during her pregnancy, was also dead.
After the matter went back to the trial Court, five additional witnesses were examined by the appellant, including his brother in law, who is a doctor and a Gynaecologist, Dr. Ajinkya and a pediatrician Dr. Udani.
The respondent examined herself as well as Dr. Mehta, a Gynaecologist and two other witnesses.
Upon a consideration of the additional evidence, the High Court allowed the appeal.
Before us, the first point urged by Mr. section T. Desai appear ing for the appellant is that the High Court was in error in ordering the recording of fresh evidence.
It is indeed surprising that the High Court which has correctly stated the legal position obtaining in divorce petitions, should have, upon its considered view that the evidence already adduced by the appellant was not sufficient to justify a passing of decree for annulment of marriage, sent down, despite the opposition of Mr. Amin on behalf of the appellant, two issues for recording fresh findings by the City Court after permitting the parties to adduce additional evidence.
It may be mentioned that the High Court thought that it was doing so to afford to the respondent, whose whole life was at stake, as observed by Patel, J., an opportunity to defend her honour and chastity.
This question, however, did not really arise, if, in fact, the High Court felt that the appellant had not discharged the burden which the law had placed upon him to satisfy the Court beyond doubt that the respondent was pregnant by a person other than himself before the marriage, and that he was not aware of it.
The two issues sent down for retrial by the High Court would seem to suggest that these essential points had been missed by the trial Court.
I have quoted in extenso the 330.
issues framed by the trial Court, and issues (1), (2) and (5) seem to cover both.
the additional issues settled by the High Court.
No doubt, the first issue reads thus: "Whether the respondent at the time of the marriage was pregnant by some one other than the petitioner as alleged in para 9 of the Petition?".
This itself consists of two parts, the first being whether the respondent was pregnant at the time of the marriage, and the second being whether she was pregnant through a person other than the appellant.
The fifth issue is undoubtedly couched in general terms, but it certainly includes the content of the second additional issue.
The High Court was itself cognisant of this because after reproducing (see judgment of Patel, J.) the terms of s.23(1) it has set out what, according to it, would be the issues which would arise.
Section 23(1) so far as relevant reads as follows: "In any proceeding under this Act, whether defended or not, if the court is satisfied that (a) any of the grounds for granting relief exists and the petitioner is not in any way taking advantage of his or her own wrong or disability for the purpose of such relief, (b) the petition is not presented or prosecuted in collusion with the respondent, (c) there has not been any unnecessary or improper delay in instituting the proceedings, and (d) there is no other legal ground why relief should not be granted, then and in such a case, but not otherwise, the Court shall decree such relief accordingly.
" The issues which would arise, therefore, would be, as pointed out by Patel, J. the following: "(1) Whether the respondent was pregnant at the date of marriage.
(2) If she was whether she was pregnant by some one other than the petitioner.
(3) Whether the petitioner was at the time of marriage ignorant of the facts alleged.
(4) Whether marital intercourse with the consent of the petitioner has not taken place since the discovery by the petitioner of the existence of the grounds for a decree.
" That the trial Court was itself aware of this, would be clear from paragraph 43 of its judgment.
It has dealt with the argument of Mr. Shah on behalf of the respondent that the 331 condition precedent laid down in s.12(2)(b)(iii) was not complied with by the appellant.
1, therefore, agree with Mr. Desai that the remission of the issues was wholly unjustified and should not have been allowed.
The effect of this, however, would be that the entire evidence adduced thereafter including the evidence upon which Mr. Desai has placed such strong reliance before us will have to be completely left out of consideration.
No doubt, an appellate Court has the power under section 107 of the Civil Procedure Code to remand a case or to frame issues and refer them for trial, or to take additional evidence or require such evidence to be taken.
But the exercise of these powers is regulated by the provisions of 0.41, rr.
23 to 25 and 27.
Under r.23, an appellate Court has the power to remand a case where the suit has been disposed of by the trial Court upon a preliminary point and its decision is reversed by the appellate Court.
Rule 24 provides that where the evidence upon the record is sufficient to enable the appellate Court to pronounce judgment, it may do so and may proceed wholly upon the ground other than that on which the appellate Court proceeds.
For this purpose it can also re settle the issues if it finds it necessary so to do.
A power to frame additional issues is conferred by r.25, which reads as follows: "Where the Court from whose decree the appeal is preferred has omitted to frame or try any issue, or to determine any question of fact, which appears to the Appellate Court essential to the right decision of the suit upon the merits, the Appellate Court may, if necessary, frame issues, and refer the same for trial to the Court from whose decree the appeal is preferred, and in such case shall direct such Court to take the additional evidence required; and such Court shall proceed to try such issue and shall return the evidence to the Appellate Court together with its findings thereon and the reasons therefor.
" Rule 27 deals with production of additional evidence in the appellate Court and prescribes the conditions upon which additional evidence can be allowed to be adduced in the appellate Court.
Rule 25 circumscribes the powers of the appellate Court to frame an issue and refer the same for trial to the Court below, if need be by taking additional evidence, and permits it to adopt this course only if (a) the trial Court had omitted to frame an issue, (b) try an issue or (c) to determine any question of fact which appears to the appellate Court essential to the right decision of the suit upon the merits.
In this case, the High Court his purported to exercise its powers 332 upon the ground that proper issues were not framed by the trial Court.
I have already indicated above that the content of the two additional issues framed by the High Court is to be found in three of the issues raised by the City Civil Court.
Therefore, there was no scope for the exercise of the High Court of its power under r. 25.
No doubt, the High Court has made no reference to r. 25 when it framed the additional issues and sent them down for a finding; but its action must be referable to r. 25, because that is the provision of law which deals with the question of remitting issues for trial to the trial Court.
I may add that in view of the express provisions of this rule the High Court could not have had recourse to inherent powers, because it is well settled that inherent powers can be availed of ex debito justitiae only in the absence of express provisions in the Code.
Upon this view it would, therefore, follow that this appeal must be decided only on the basis of the evidence which was before the City Civil Court prior to the interlocutory judgement of the Hight Court remitting to it two issues for findings, leaving altogether out of consideration the evidence subsequently brought on record by the parties.
Before I deal with that evidence, it would be desirable to set out in brief the requirements of the law in a petition of this kind.
The appellant had sought annulment of his marriage with the respondent upon the ground that she was pregnant by a person other than himself before the marriage, and that he was not aware of this fact.
The law of divorce in India, is broadly speaking, modelled on the law of England.
It will, therefore, be useful to refer to the decisions of the Courts in England.
In Ginesi vs Ginesi(1), it was said that in matrimonial cases the same strict proof of adultery is required as in criminal cases, and that the matrimonial offence must be proved beyond all reasonable doubt to the satisfaction of the tribunal of fact.
This decision was criticised in Gower vs Gower(2).
Ginesi vs Ginesi(l) was actually followed in Fairman vs Fairman (3), where it was observed that when a witness gives evidence in matrimonial proceedings that he or she has committed adultery with a party to those proceedings that evidence must be treated with the same circumspection as the evidence of an accomplice in a criminal case.
The view taken in Ginesi 's case(1) has also been accepted in Preston Jones vs Preston Jones(4) and Galler vs Galler(5).
In the first of these two cases, which is a decision of the House of Lords, it was established by evidence that during the period between 186 and 360 days before the birth of the child (1)(1948) (2) (3)L.R. (4) (5) 333 to the wife the husband had been continuously absent abroad and that there had been no opportunity for intercourse bet ween them.
The child was normally delivered, and appeared a normal, healthy and full time child.
It was contended on behalf of the husband that in these circumstances the child must be deemed to have been born of adulterous intercourse by the wife with some one else.
With the exception of Lord Oaksey, the view of the House of Lords was that the onus of proof on the husband in a case of this kind did not extend to establishing the scientific impossibility of his being the father of the child.
Lord Simonds.
Lord Oaksey and Lord Mac Dermott were of the view that in the case of an interval of 360 days between intercourse with her husband and the birth of a child the court cannot, in the absence of further evidence, regard adultery by the wife as established.
Lord Normand was dubitante, and Lord Morton of Henryton dissented from this view.
In the course of his speech, Lord Simonds observed; "The result of a finding of adultery in such a case as this is in effect to bastardize the child.
That is a matter in which from time out of mind strict proof has been required.
But that does not mean that a degree of proof is demanded such as in a scientific enquiry would justify the conclusion that such and such an event is impossible.
In this context at least no higher proof of a fact is demanded than that it is established beyond all reasonable doubt; see Head vs Head(1).
The utmost that a court of law can demand is that it should be established beyond all reasonable doubt that a child conceived so many days after a particular coitus cannot be the result of that coitus." He then added that since writing his opinion he had had the advantage of reading that of Lord MacDermott and he concurred in what Lord MacDermott bad to say.
It would be convenient now to refer to the observations of Lord MacDermott.
At page 417 of the Report are his relevant observations: "The evidence must, no doubt, be clear and satisfactory, beyond a mere balance of probabilities, and conclusive in the sense that it will satisfy what Lord Stowell, when Sir William Scott, described in Loveden vs Loveden(2) as 'the guarded discretion of a reasonable and just man '; but these desiderata appear to me entirely consistent with the acceptance of proof beyond reasonable doubt as the standard required. .
I am unable to subscribe to the view which, though not propounded here, has its adherents, namely, that on (1)Sim and section 150.
(2) (1810) 2 Hag.
Con., 13.
334 its true construction the word 'satisfied ' is capable of connoting something less than proof beyond 'reasonable doubt '.
The jurisdiction in divorce involves the status of the parties and the public interest requires that the marriage bond shall not be set aside lightly or without strict inquiry.
The terms of the statute recognize this plainly, and I think it would be quite out of keeping with the anxious nature of its provisions to hold that the court might be 'satisfied ', in respect of a ground for dissolution, with something less than proof beyond reasonable doubt." After saying that he did not base his conclusion as to the appropriate standard of proof on any analogy drawn from criminal law since the two jurisdictions are distinct, he observed The true reason, as it seems to me, why both accept the same general standard proof beyond reasonable doubt lies not in any analogy, but in the gravity and public importance of the issues with which each is concerned." Lord Oaksey, after pointing out that the only thing sug gested against the wife was that her child was born 360 days, after her husband had access to her, observed: " In such circumstances the law, as I understand it, has always been that the onus upon the husband in a divorce petition for adultery is as heavy as the onus which rests upon the prosecution in criminal cases.
That onus is generally described as being a duty to prove guilt beyond reasonable doubt but what is reasonable doubt is always difficult to decide and varies in practice according to the nature of the case and the punishment which may be awarded.
The principle upon which this rule of proof depends is that it is better that many criminals should be acquitted than that one innocent person should be convicted.
But the onus in such a case as the present, is not founded solely upon such considerations but upon the interest of the child and the interest of the State in matters of legitimacy, since the decision involves not only the wife 's chastity and status but in effect the legitimacy of her child.
" One of the decisions relied upon before the House of Lords was Gaskill vs Gaskill(1), in which the birth of the child had taken place after an interval of 331 days between it and 335 the coitus with the husband Lord Birkenhead, L.C., who tried the case sitting as a judge of first instance, said, in regard to the wife: "I can only find her guilty if I come to the conclusion that it is impossible, having regard to the present state of medical knowledge and belief, that the petitioner can be the father of the child.
The expert evidence renders it manifest that there is no such impossibility. 'In these circumstances I accept the evidence of.
the respondent, and find that she has not committed adultery, and accordingly I dismiss the petition." Referring to this decision, Lord Morton of Henryton observed in Preston Jones vs Preston Jones(1): "My Lords, in the case of Gaskill vs Gaskill(2) the birth was far from being a normal one, but I think that Lord Birkenhead placed too heavy a burden of proof upon the husband.
It is not the law to day, in my view, and with all respect to Lord Birkenhead I do not think it was the law in 1921, that a husband is bound to prove that he cannot possibly be the father of the child and I do not think that the case of Morris vs Davis(3), cited by Lord Birkenhead, established the strict rule which he laid down." He then referred to Wood vs Wood(4), in which the interval was 346 days and Hadlum vs Hadlum(5), where the interval was 349 days, and observed: "But I think that the cases of Gaskill(2), Wood(4) and Hadlum(5) put an unwarranted and increasing burden upon a husband who seeks to prove his wife 's adultery.
" On the other hand, he expressed his agreement with the view of Ormerod, J., in M T vs M T(6), where the interval was 340 days, and acting upon the medical evidence to the effect that the husband could not have been the father of the child, the learned Judge without saying anything about the burden of proof granted a decree to the husband.
In Galler vs Galler(7), Hodson L.J. has observed at p. 540: "I have used the language which I have, because, since Fairman vs Fairman(8) was decided, the much debated question whether the standard of proof in a divorce suit, which is a kind of civil action, is the same as that ina criminal case, and whether the (1) (2)(1921) P. 425.
(3)5 Cl. & F. 163.
(4) (5)(1949) P. (7)(1954) 1 All E.R. 536.(8)L.R, (1949) P. 341.
336 case rules apply, has been considered by the House of Lords in Preston Jones vs Preston Jones(1)." and has quoted with approval the opinions expressed by Lord Simonds and Lord MacDermott.
He then observed: "It might appear from the passages which I have read from the judgment in Fairman vs Fairman(2) that the anology of criminal law was the ratio of that decision, but I think the result is the same by whichever road one travels.
In divorce, as in crime, the court has to be satisfied beyond reasonable doubt.
" A similar view has been expressed by Sir Lallubhai Shah in John Over vs Murial A.I. Over(3).
The learned Judge has said: "I desire to make it clear that in divorce cases, great care and caution are necessary in dealing with the admissions of parties and it is only the exceptional circumstances of a given case that could justify the Court in acting upon the admissions of party as to adultery without any corroboration.
Generally speaking as a matter of prudence it is desirable to insist upon evidence corroborative of the admissions.
" Martin, J., has observed in the same case at p. 259: "No doubt section 15 provides that subject to the provisions herein contained, all proceedings under this Act between party and party shall be regulated by the Code of Civil Procedure.
But that provision, in my opinion, does not override the express directions in sections 7, 12, 13 and 14 to which I have already alluded." (The provisions referred to are those of the ).
Indeed, in White vs White(4), which was a case under the , this Court has held that the words "satisfied on the evidence" in s.14 of the Act implied that it is the duty of the Court to pronounce a decree only when it is satisfied that the case has been proved beyond rea sonable doubt as to the commission of a matrimonial offence.
After pointing out that the evidence must be clear and satisfactory beyond the mere balance of probabilities, this Court had said that the rule laid down in Preston Jones vs PrestonJones(1) should be followed by the Courts while dealing with cases under section 7 of the , Section 23(1) of the which deals with the powers of the Court in a proceeding under the Act also provides that the Court shall decree the relief claimed by the petitioner, whether the petition is defended or not, if the Court is (1) (2)L.R. (3) (4)1958 [S.C.R.] 1410.
337 satisfied that any of the grounds for granting relief exists and certain other conditions are satisfied.
Thus, under the as well as under , the condition for the grant of a relief is the satisfaction of the Court as to the existence of the grounds for granting the particular relief.
The satisfaction must necessarily be founded upon material which is relevant for the consideration of the Court, and this would include the evidence adduced in the case.
Therefore, though in the former Act the words used are "satisfied oil the evidence" and the legislature has said in the latter Act "if the court is satisfied", the meaning is the same.
In my judgment, what the Court has said in White 's case(1) about the applicability of the rule in Preston Jones vs Preston Jones(2) must also apply to a case under the .
Now, let us consider the evidence which was originally tendered at the trial of the proceedings before the City Civil Court.
In support of his case, the appellant examined himself and his father.
The gist of his evidence, when he was examined in chief, is that he did not see the respondent between the date of the betrothal and his marriage either at Bombay or at any other place, i.e., between November 1, 1946 and March 10, 1947, that he did not know at the date of the marriage that the respondent was pregnant, that he and the respondent lived together for 10 or 12 days at Vile Parle after the marriage, that during this period she did not disclose to him that she had been pregnant prior to the marriage, that he left for U.S.A. in the last week of April, 1947, that the respondent who had gone to Prantij in the meanwhile returned to Bombay only a day prior to his departure, that he was aware before he left for U.S.A. that the respondent had become pregnant, and that he did not disclose this fact to any one, because he was not sure whether she was pregnant or not.
lie further stated that he returned to India towards the end of the year 1947 and that he only learnt IO to 15 days prior to his departure to India and while he was in London, of the birth of a child to the respondent.
and that he was shocked at the news and began to suspect her.
He denied having made any demand upon the res pondent for having pre marital sex relations or had said to her that betrothal was as good as marriage and that the marriage ceremony was merely a legal formality for "legalising children".
In his cross examination, he admitted that he had seen the respondent before the marriage on three occasions, two of which were subsequent to the betrothal.
He denied a suggestion made to him in cross examination that he visited Ahmedabad where his father owns a house, on many occasions between November, 1946 and March, 1947.
He also denied having (1) ; (2) 338 expressed his desire to see the respondent.
He, however, admitted that he had written to her suggesting that she should come to Bombay where his sister was residing and that he made this suggestion immediately after the betrothal had taken place.
A number of letters written by the appellant to the respon dent in which he had suggested that they should meet and come in closer contact with each other were put to him, and he admitted them.
He admitted having stated in his letter dated July 11. 1945 that the object of betrothal two years prior to marriage was that both should come in contact with each other so that they might be "accommodative to each other and not for the sake of betrothal." He was asked to explain what he meant by this and his explanation was "I meant that I and the respondent should try to know each other by writing letters and by knowing the views of each other.
By the word 'Sugan ' used in that sentence (which is in Gujarathi), he said that I meant that the marriage life may be smoothened after (sic) each other." He admitted that in, one of her letters the respondent had stated that her father was objecting to her coming into contact with the appellant before marriage.
He has admitted in his cross examination that after he came to know that the respondent had conceived he had written to her that she should arrange for an abortion.
In cross examination,the following questions were put to him: "Q.
In the letter dated 17th April 1947, you have stated 'I had already told you from the beginning but you did not pay any attention to my say. ' What do you mean by that sentence? A. (The witness refers to the letter dated 17th April 1947 written by him to the respondent part of Ex No. 3 and gives the answer after reading the same).
By that sentence I meant to convey that I had told the respondent after the marriage when I had sexual intercourse with her that we should not have a child and for that purpose we should take precautions but in spite thereof no precautions were taken and therefore I had stated what is written in my letter dated 17th April 1947 part of exhibit
No. 3.
" He has also made admissions to the effect that he had sug gested abortion to the respondent several times.
According to him, she also expressed a similar desire.
I have already pointed out that the appellant had said that he wanted to keep the fact of respondent 's pregnancy a secret, though he knew about it before his departure to U.S.A. He had to admit that he had suggested to the respondent that she should intimate the fact to his sister, Sharada.
In that letter he had also said "Explain 339 all things to my sister Sharada".
According to him, however, what he meant was that she should explain to Sharada" in connection with the posting of the letters to be written by Sharada to me.
" That is all his evidence.
There is nothing in the evidence of his father, which has any bearing upon the Question of the respondent 's pregnancy before the marriage.
In her evidence, the respondent has reiterated her denial of having conceived from a person other than the appellant.
She has, however, deposed to the fact that she had visited Bombay before the marriage about the Christmas days in the year 1946 and stayed in the house of Ramanlal, Witness No. 2 for the respondent, who is a friend of her father.
According to her, the appellant used to visit his house and take her from there either to her father in law 's house or to pictures or to some hotel.
Then she has deposed.
"On those occasions I had sexual intercourse with the petitioner.
I agreed to submit to the sexual intercourse by the petitioner because he threatened to break off the betrothal if I refused to permit him to have sexual intercourse.
Prior to the date of my marriage with the petitioner, I had no sexual intercourse with any man other than the petitioner.
" She has further said categorically in her evidence that she did not know at the time of her marriage that she was pregnant and that she became aware of this after the marriage only when she started vomiting.
This was after she had returned to Prantij from Vile Parle.
She has also stated in her evidence, "After I went to Prantij after my visit to Bombay in Christmas 1946, 1 had monthly course.
After I left for Prantij after my visit to Bombay in January 1947 and before the marriage I had monthly course.
But on those occasions the bleeding was less.
" She was cross examined at length with regard to her story that she had sex relations with the appellant before the marriage, and after asserting once again that she had met the appellant in Bombay in December 1946 or January 1947 she said in answer to the next question: "It is not true that prior to the marriage I knew that I was pregnant.
It is not true that I deliberately suppressed the fact of my pregnancy from the petitioner and performed marriage with him.
It is not true that I was not pregnant as a result of the sexual intercourse with the petitioner prior to the marriage.
" And then in answer to the question "Before 10th March 1947 Mahendra, the petitioner, his sister Sharada and his father did not know that you were pregnant?", her answer, after certain hesitation was: "It is not true that the petitioner, his sister Sharadaben and his father did not know that I was pregnant 340 prior to the marriage.
According to me the petitioner, his father and his sister knew prior to our marriage that I was pregnant." In the letter dated January 8, 1948 written by her to the appellant 's sister she had stated "I am innocent", and in crossexamination, she was asked as to what was the necessity for her to write that in her letter if the child which was born to her was conceived from the appellant, her answer was: "We came to know that a scandal was raised by my father in law and mother in law at Vile Parle and that is why I had written to my sister in law that I was innocent.
The scandal which I have referred to in my earlier answer was that the baby born to me was premature and was not the child of the petitioner.
" She was then asked why she did not inform the appellant 's sister, Sharadaben, that she had pre marital sexual intercourse with the appellant, her answer was that she did not do so in obedience to an injunction from her husband.
It may be mentioned that in the letter of January 8, 1948 the respondent had stated that she had her menstrual period 10 days prior to the marriage.
The question put to her in cross examination was whether she stated this in her letter with the object of showing that she had no sexual intercourse with any one before the marriage and her answer was: "Even if the woman is pregnant she would be in monthly course.
It is not true that the object of my writing the aforesaid statement in my letter was as you suggest.
" When again pressed to state what was the object in saying "I am innocent" in that letter, she answered: "By saying that I was innocent, I meant to suggest that the scandal which was spread about the child being not of the petitioner was a false scandal." When asked why she did not write in that letter that this child was conceived as a result of the sex relations she had with the appellant in December 1946 and January 1947, her answer was that the appellant knew the fact and knew that lie was the father of the child.
When asked why she had then described the child as premature in that letter, her answer was that that was because the child was weak, Eventually, however, she admitted that the child born to her was premature.
The only other witness examined was Ramanlal, with whom the respondent claims to have stayed during her visit to Bombay in December 1946 January, 1947.
He supports her statement in that regard as well as the other statement that during her stay there the appellant used to visit her and take her out.
341 That is all the evidence in the case, and the question is whether upon this evidence it was open to a Court to make a. decree under section 23 of the annulling the marriage upon the ground that the respondent had conceived, from a person other than the appellant before her marriage and that the appellant was not aware of this fact at the time of the marriage.
It is contended on behalf of the appellant that the respondent has admitted both in her pleading and in her evidence in the Court that she had had pre marital sex relations and that this admission by her should be construed against her.
An admission in a pleading must be taken as a whole, and, therefore, if we are to act upon that admission, then that part of it which is to the effect that she had such sex relations with the appellant and not anyone else must also be regarded.
No doubt, what applies to an admission in the pleading would not apply to statements made by a witness in evidence.
It seems to me, however, that the defence taken by the respondent of having had pre marital sex relations with the appellant as well as the evidence given by her in the Court was false.
Had there been any truth in this, she would certainly have taken that defence in the earlier suit, which was filed in the Baroda Court.
Apparently, faced with the fact that the child was born to her only five and half months after her marriage she and her advisers found themselves in a difficult situation.
For, having regard to the generally accepted notions of people regarding the normal period of gestation it would be difficult to convince any one of the fact that the child was legitimate, particularly in view of the fact that it has in fact survived and so would be presumed to have been normal.
It may be because of this that she and her advisers thought of an obviously false defence.
Would this, however, make any difference either in the incidence or the discharge of the burden which the law casts upon the petitioner in a proceeding like this, of establishing affirmatively the existence of the ground relied upon by him? I would say with Lord Normand that apart from the objection of principle, it would in the circumstances of this case be unjust to the respondent to infer or assume that the false defence is tantamount to an admission of guilt.
If it is possible that an apparently normal child may be born 171 days after coitus (or even 186 days as contended by Mr. Purshottam Trikamdas) and would survive, and if that was what had happened in this case, then in the words of Lord Normand "the departure from the normal course of things is so extraordinary that the mother, conscious of innocence but believing herself the victim of a sport of nature, might, despairing of establishing the true defence, allow herself to palter with the truth, and might induce others closely connected with her to lend themselves to prevarication 342 or worse.
" I would, therefore, wholly leave out of account the false defence set up by the respondent.
Even if the appellant 's evidence is believed completely, the facts which can be said to have been established by him are only these:(a) that the child was born 171 or 186 days after the marriage;(b) that he never had pre marital intercourse with the respondent; and (c) that he was not aware of her pregnancy before the marriage.
Can it be said that this evidence justifies the conclusion that the child must have been conceived before the marriage, and since, if the appellant 's statement is believed, it could not be conceived from him, but from some one else? It was urged by Mr. Desai, apparently on the strength of an observation made in one of the speeches in Preston Janes ' case(1) that where the period of gestation deducible in respect of a child deviates markedly from the normal, the burden on the husband who denies being its father of establishing the matrimonial offence alleged by him against his wife is a very light one.
With respect I would say that the argument is untenable.
When the law places the burden of proof upon a party it requires that party to adduce evidence in support of his allegation, unless he is relieved of the necessity to do so by reason of admissions made by or in the evidence adduced on behalf of his opponent.
The law does not speak of the quantum of burden but only of its incidence and to my mind it is mixing up the concepts of the incidence of burden of proof with that of the discharge of the burden to say that in one case it is light and in another heavy.
Looked at that way, the argument would amount, in effect, to be that the appellant has fully discharged the burden of proving hi , wife 's pre marital conception because, admittedly, the child was born only 171 or at most 186 days after the marriage.
While it would be relevant to bear in mind the fact that the child was born within 171 or 186 days of the marriage for deciding the question whether the conception was pre marital, other relevant factors and circumstances cannot be excluded.
For, it cannot be assumed that the delivery was normal, the child was born at the end of the full period, that it was a normal and mature child, that the mother maintained normal health throughout the period and so on.
Again, there is no evidence whatsoever that the respondent was a woman of loose character.
On the other hand, such little evidence as there is bearing on the point would show that the respondent was a member of a family which had strong ideas regarding association between betrothed couples and was herself reluctant even to meet the appellant during the long period of their betrothal.
There is nothing in the evidence to indicate that the respondent could have had an opportunity of coming in contact with male persons at Prantij, where she lived before her marriage.
(1) 343 The second thing is that if as contended on behalf of the .appellant, the respondent 's delivery was after the full period of gestation, her pregnancy must have been of about four months ' duration at the time of the marriage.
If that were, so, it is difficult to believe that this fact would not come to ' the notice of the female relatives of the appellant or the appellant himself, or of Dr. Champaklal the appellant 's brother inlaw who has been found by the High Court to have examined her.
Moreover, had that been so, she would not have shown readiness to break off her engagement till as late as in February, 1947 and thus taken the risk of becoming an unmarried mother.
The third thing is that if the respondent 's nausea started three weeks after returning to Prantij, how could it be related to a pregnancy of five months ' duration? Fourthly, if the respondent had her menstrual period 10 days before the marriage, then despite what she herself says, how could she be said to be pregnant at that time? Indeed, the progress of the pregnancy as appearing from the evidence which was not challenged before us is consistent only with post marital conception. There is also the circumstance that despite exhortation by the appellant she refrained from having an abortion, which is more consistent with the pregnancy being post marital than pre marital.
As against this, all that is relied upon on behalf of the appellant is the circumstance that it would be against the generally accepted notions of mankind to hold that a normal child would be delivered after 171 or 186 days after conception.
Can it reasonably be said that this circumstance is sufficient in itself to outweigh the other circumstances taken cumulatively? At the stage with which I am dealing, there was no medical evidence in the case.
But it was said that the live birth of a child 171 or 186 days after conception is impossible and it must be presumed that the child was conceived before marriage and further that such a presumption can be competently drawn even in a proceeding of this nature.
If the birth of an apparently normal child 171 or 186 days after conception is an impossible phenomenon and if its impossibility is notorious, then alone a Court can take notice of it and the question of drawing a presumption would arise.
All that can be said is that such an occurrence can at best be said to be unusual; but it is a far cry to say that it would be impossible.
No doubt, courts have taken notice of the fact that the normal period of gestation is 280 days, but the courts have also taken notice of the fact that there are abnormal periods of gestation depending upon various factors.
It would appear from the medical evidence in this case that one of such factors is a short cycle of menstruation.
Another is that where the mother is suffering from oedema and high blood pressure and passing albumen in her urine the period of gestation of the child will be shortened (see evidence of Dr. B. section Mehta).
344 There may also be other factors which have not been brought out in the evidence or which may not have yet come to the notice of obstetricians.
Therefore, while the courts ought in cases which largely turn upon medical evidence, to have regard to the existing state of medical knowledge they should not overlook the fact that there is still a good deal which is not known.
So when a court is called upon to decide a matter like the one before us mainly, if not wholly, on the opinion of medical men it must proceed warily.
Medical opinion even of men of great experience and deep knowledge is after all a generalisation founded upon the observation of particular instances, however numerous they may be.
When further the Court finds that in individual cases departure from the norm has in fact been observed by some experts and when again the experts themselves do not speak with the same voice the need for circumspection by the court becomes all the more necessary.
It may land itself into an error involving cruet consequences to innocent beings if it were to treat the medical opinion as decisive in each and every case.
The responsibility for the decision of a point arising in a case is solely upon the court and while it is entitled, nay bound, to consider all the relevant material before it, it would be failing in its duty if instead, it acts blindly on such opinion and in disregard of other relevant materials placed before it.
Initially no attempt was ever made before the City Civil Court to adduce any scientific evidence i.e., evidence of experts, and in the absence of such evidence, can it be said that there was anything else of which the City Civil Court ought to have taken judicial notice? Should it have drawn any presumption? The only relevant provisions regarding presumption are sections 112 and 114 of the Evidence Act.
Section 112 reads thus: "The fact that any person was born during the continuance of a valid marriage between his mother and any man, or within two hundred and eighty days after its dissolution, the mother remaining unmarried, shall be conclusive proof that he is the legitimate son of that man, unless it can be shown that the parties to the marriage had no access to each other at any time when he could have been begotten.
" It refers to the upper limit of the duration of pregnancy for the purpose of determining the legitimacy of a child but not to the lower limit.
Section 114 enables the court to presume the existence of any fact which it thinks likely to have happened, regard being had to the common course of natural events, etc., in their relation to facts of the particular case.
The question would then be whether from the circumstance that the child was born five and half months or so after the marriage it could be presumed to have been conceived before the 345 marriage, regard being had to the common course of natural events.
If the only fact known was that the child was born on August 27, 1947 and nothing else was known, it would be open to the Court to presume that it was conceived so many days prior to its birth.
If, however, in addition to this there was evidence to show that the mother was suffering from eclempsis or that the child was weak and premature such a presumption would not arise.
In this case, there is evidence of both these facts.
This consists of the testimony of the respondent herself and of her letter to the appellant, exhibit 6 dated August 13, 1947 and of that to Sharadaben, exhibit F dated September 3, 1947 produced by the appellant.
This is further supported by the letters exhibit 11 written by Dr. Champaklal to the respondent 's father on July 12, 1947 and September 20, 1947.
It would, therefore, not be legitimate to raise the presumption that the child was born after the normal period of gestation and must, therefore, have been conceived 'before the marriage.
Such was the material before the City Civil Court at the conclusion of the trial and before High Court when it first heard the appeal.
This material is insufficient for discharging the burden placed on the petitioner by section 23 of the Act.
On the basis of this material, no Court could reasonably come to a finding that the respondent was pregnant at the time of her marriage and that, therefore, the appellant was entitled to the annulment of the marriage.
As already pointed out by me, this is what the High Court itself felt, and having formed this view, it is a matter of surprise to me that the High Court should have proceeded to frame additional issues and send them down for findings to the City Civil Court.
The only thing the High Court could properly do was to allow the appeal and dismiss the appellant 's petition for annulment of the marriage.
Now, the High Court has, after receipt of the additional evidence and the fresh findings of the City Civil Court accepted one of those findings and dismissed the appellant 's petition.
If, therefore, I am right in my view that the letting in of the additional evidence for which the appellant had not even asked, was not permissible by law, then upon my view that the evidence originally adduced in the proceedings is inadequate for the purpose of granting the relief under section 23 of the Act, the appeal must be dismissed.
I would accordingly dismiss it with costs in this Court, and direct that the appellant shall pay the respondent 's costs in the High Court as well as in the City Civil Court.
This really ends the matter, but as my learned brother Raghubar Dayal J., has considered the medical and other evidence in great detail, I should at least make a brief reference to it, even though, in my view, it has been illegally admitted.
I will only refer to the evidence of those witnesses 346 upon whose statements reliance was placed before us by one party or the other.
One is Madhuben, who claims to have been working in the Prantij Municipal Dispensary from 1939 to 1955.
She said that she atte nded to the delivery of the respondent, and that she had examined her two months before the date of delivery, when she noticed swelling all over her hands and feet.
She also says that the respondent had ad vanced seven months in the pregnancy when she first examined her and that the weight of the child which was born was 4 to 4 1/2 lbs.
According to her, it was a mature child born after the full period of gestation.
Her evidence was discarded not only by the High Court but also by the City Civil Court on the ground that she was deposing to these facts 12 years after the delivery is supposed to have occurred, and deposed without reference to any records made by her.
No doubt, the Hospital Indoor case paper, exhibit K. was produced by a witness, Kacharabai, also examined at that stage; but in the absence of a white paper, which is normally a part of this particular record, it loses its value.
It is true that there was No. crossexamination on behalf of the respondent regarding Madhuben 's statement that she had examined the respondent two months before the delivery, but it seems to me that from the fact that she deposed 12 years after the event and the further fact that she had to attend to at least 150 labour cases every year a total of 2,400 cases during the time she worked in the hospital her evidence cannot be regarded otherwise than as artificial.
Indeed, she had long ceased to be in the service of the hospital, and had even left Prantij, before she was summoned as a witness in the case.
According to her, she was contacted by some bania and it is obvious that she has been induced to speak to facts which would assist the appellant in this case.
Her evidence was rightly rejected by the courts below.
The next witness is the appellant himself.
He has stated in his evidence that his case was that the child born to the respondent was born after the expiration of the full period of gestation, and that the respondent must have conceived somewhere in November or December, 1946.
He has, however, admitted that when he had sex relations with the respondent, her clothes used to be removed, though he said that lights used to be switched off in the room in which they slept.
We cannot lose sight of the fact that in Bombay after sunset the streets are well illuminated and since the windows are usually kept open the light coming from outside is sufficient to illuminate the rooms adjacent to the streets.
They therefore are not totally dark even at night.
Apart from that, the appellant has admitted that he did not feel anything abnormal when he came in contact with her.
If her pregnancy had actually advanced to four months, in the normal course it would have been possible for him to notice her condition.
347 Then there is the evidence of Dr. Ajinkya.
He has deposed to a large number of things, and the only points which it is necessary to mention are: (a) the normal period of gestation is 280 days, which period is calculated from the first day,,,,, of the last menstrual period; (b) where the hospital record .shows that the woman delivered of a child has normal labour and the child weighed 4 lbs and is living, it must have been conceived 270 days before the date of birth; (c) if a child is born within 169 days from the date of marriage it would not be of sufficient maturity to survive; (d) confirmation of a pregnancy within three weeks of conception is possible only by a biological test; (e) abdominal enlargement would be perceptible after the fourth month of pregnancy; (f) viability is described as the critical period of maturity and that this period is the 28th week of conception and explained that the viable period is called critical period because it denotes the development of the child 's tissues to the extent that it can have independent existence from its mother only after that and not before; and (g) a child born after the 28th week from conception would survive when special care and treatment is given to it.
He has then described the special care which has to be taken in regard to such child.
The following passage from Taylor 's Principles and Practice of Medical Jurisprudence, Vol 2, 11th Edn.
p. 32 was put to him: "It was the opinion of William Hunter that few children born before 7th calendar month (or 210 days) are capable of living to manhood, but with advances in methods of Neonatal Resuscitation and maintenance, this dictum has gradually receded into history.
It remains, nevertheless, that the less mature the infant the less likely is it to survive and the critical period of maturation appears to be somewhere between the 5th and 6th month.
In the absence of any skilled care, Hunter 's dictum on the likelihood of survival when born before the 7th calendar month remains as true as it was." According to him, this dictum was not wholly true, and what was attributed to Hunter was really the opinion of the author.
I may mention here that Dr. Mehta has agreed with the above quotation from Taylor 's book.
Now, since the month of pregnancy is a lunar month the respondent 's child which was born 26 weeks and four days after the marriage could be said to be one born in the 7th month.
The fact that such a child has survived its birth is no significant evidence of matu rity.
Taylor points out that though infants born before the seventh month of pregnancy are less likely to survive they commonly do so.
The following cases of survival of less mature infants are referred to in this connection: 348 Bernardi described the survival of a 1 lb. 9 oz.
infant in 1951, and Nanayakkara, in the same year, recorded a birth at 1 lb. 4 oz. which survived.
MacDonald reported the survival of a 14 in.
long 2 lb. 7 oz.
infant thought to be a gestation of 6 to 61 monthsthat, six months later, weighed 5 lb. 6 1/2 oz.
The considerable experience of Victoria Crosse in problems of prematurity resulted in the publication of the following table, emphasising the high mortality of prematurity: Weight of Infant (lb)Percentage leaving Hospital 0.2 3 2 3 27 3 4 60 4 5 78 5 5 1/2 94 The author then refers to a case attended by Barker in which a female child born 22 weeks after intercourse was observed by him to have attained the age of II.
Similarly the author refers to a case from America when a child born 192 days, after intercourse was found alive at the time of report which was 16 months after its birth.
In the well known Kinghorm case the doubt cast on the legitimacy of a child born 174 days after the marriage between the parents was found not to have been substantiated.
It would be convenient to quote here two passages from the article by J. H. Peel at p. 557 onwards of British Obstetric Practice (22nd edn.) on "Duration of Pregnancy and its variations".
He begins by saying that the problem of the exact duration of pregnancy has not yet been solved that this is due to a large number of variable factors.
He points out that the common method of calculating the date of delivery ignores all the variables.
Dealing with premature termination of pregnancy he says: "Premature termination of pregnancy may be defined as termination of the pregnancy after the twentyeighth week (accepted date of viability of the foetus) and before the fortieth week, counting from the first day of the last menstrual period.
On the other hand, most writers on the subject of prematurity tend to define the condition in terms of the weight of the baby rather than in terms of the maturity of the pregnancy.
It was first laid down by the American Academy of Pediatrics in 1935 that a premature infant is one that weighs 5 1/2 lbs.
349 or less, regardless of the period of gestation.
This definition was accepted by the International Medical Committee of the League of Nations and has gained universal acceptance, in spite of its scientific inaccuracy.
Most obstetricians have seen babies of less than 51 lbs.
born after a gestation period of more than 280 days.
Indeed, birth weight and duration of pregnancy are far from perfectly correlated.
Infants weighing less than 5 1/2 lb.
at birth may even be postmature.
This is well shown in Table 2 constructed by Kane and Penrose from 7,037 live births from University College Hospital records.
It is seen that 470 babies weighed less than 5 1/2 lb., but that III (23.6 per cent) of these underweight babies were born at term or later, according to the ordinary method of calculation.
The term immaturity has been suggested as an alternative in view of these discrepancies, but it has not received universal acceptance.
There is, however, more than academic significance in the difference, because maturity as such, irrespective of weight, is of the greatest im portance in relation to foetal survival.
A baby whose birth weight is 4 lb., if born at thirty eight weeks stands a far better chance of survival, and is more likely to develop into a healthy child, both mentally and physically than one of the same weight born a month earlier.
" I am not reproducing the table constructed by Kane and Penrose but I may only mention that the table shows a few cases of deliveries in which the duration of pregnancy was 177 days, though they ended either in still births or neonatal deaths.
The conditions associated with premature labour are many and varied and Peel has classified themthus: (1) Maternal causes.
(a) Pre existing (b) Complications of Pregnancy.
(2) Foetal and Placental causes.
(3) Idiopathic causes.
" He has then dealt with these causations of premature labour but I would content myself by quoting a portion of what he has said regarding 'Idiopathic causes '.
This is what he says: "In about 50 per cent of premature labours no definite cause can be found.
Thus Sandifer (1944), analysing premature births at Queen Charlottee 's Hospital, found no definite cause in 372 out of a total of 681 spontaneous premature labours.
350 doubt correlated with nutrition dependent upon social status.
" What does all this show? It brings out the fact that while the natural phenomenon of human birth follows a general pattern it does not do so invariably.
There are variations in it.
A few have been recorded but in the nature of things the observations cannot be exhaustive, bearing in mind the fact that every minute a new human is being born in this world or may be even more than one.
Section 45 of the Indian Evidence Act makes the opinion of scientists relevant when the court has to decide a point of science.
But it does not make the opinions conclusive.
Therefore, while the courts ought to pay due regard to the existing knowledge of scientists it does not necessarily follow that the opinions expressed by scientists must be always accepted without scrutiny.
Every phenomenon is the result of numerous factors and where all such factors are known to science an opinion of an expert concerning the particular phenomenon ought ordinarily to be accepted.
But when all the factors which come into play in a phenomenon are not known, an uncritical acceptance of an expert 's opinion would be a dangerous thing.
Medical scientists do not lay claim to a knowledge of every factor involved in human birth.
One of the factors they have to contend with is the operation of the life principle.
The mystery of its behaviour has yet to be unravelled and, therefore, if an expert makes a dogmatic assertion about any matter concerning child birth dismissing contrary opinions based upon the observations of departures from the so called norm with supersilious disdain as Dr. Ajinkya has done or is unable to give a satisfactory explanation for the departure from the normal observed by other scientists, I would put aside his opinion on the ground that his whole approach is unscientific.
In this evidence Dr. Ajinkya has further deposed about toxaemia in pregnancy, enlargement of abdomen, weight of the child born after the full period of gestation.
When he was asked the question: "If toxaemia starts at the end of 4th month of pregnancy and in spite of the treatment, there is no ,change in toxaemia for a period of seven weeks thereafter what would be the condition of the child born 169 days after marriage?" His answer was, "most probably it would be a still birth." From this last statement of the witness it would appear that if, when the respondent 's toxaemia as evidenced by vomiting and nausea started, she was in the fourth month of pregnancy and not in the second month of pregnancy the child delivered by her on August 27, 1947 would be still born but in fact it was alive and is now 16 years of age. 351 The following passage from Mody 's Medical Jurispru dence and Toxicology, 12th edn.
p. 305 was put to him: "It has been observed in women whose intermenstrual period is shorter than the usual time, pregnancy has terminated in the 8th or 9th month or even earlier the child having attained full development." (Italics are mine).
Dr. Ajinkya, however, expressed disagreement with it.
According to him, the weight of the child born in the 5th or 6th month after the marriage would be 2 1/2 lbs.
and the child would not survive, whereas here the evidence, if accepted, is that the weight of the child was 4 to 41/2 lbs.
In the table constructed by Kane and Penrose three Cases have been recorded in which the infant born in the 7th month of pregnancy weighed between 5 and 6 lbs.
Dr. Ajinkya 's opinion cannot, therefore, be accepted.
He also said that if a pregnant woman is suffering from oedema all over the body, is passing albumen in the urine, has high blood pressure and does not respond to treatment, it would be a severe type of toxaemia and the child born to her would be still born.
If this opinion is accepted, then considering it along with the fact that the child born to the respondent is still alive, the evidence of Madhuben that the respondent was suffering from eclempsia and therefore she had to attend on her for two months before the delivery stands falsified.
The witness has also said that the period of gestation is usually counted in lunar months, meaning a month of 28 days and that as doctors do not know the date of the fruitful coitus, they calculate the period of gestation from the first day of the last menstruation of the woman.
As regards nausea during pregnancy, he said that morning sickness occurs in the 1st or 2nd month and has expressed agreement with the following passage from Mody 's Text Book: "Nausea or vomiting usually as a sign of pregnancy, most frequently occurs soon after the woman rises from bed in the morning.
It commences about the beginning of the second month and lasts generally till the end of the fourth month.
It may, however, commence soon after conception." Another passage from Mody was also put to him.
A passage from Taylor, Vol. 2, 6th ed.
at p. 152 was read out to him.
It runs as follows: "It would be in the highest degree unjust to impute illegitimacy to offspring, or a want of chastity to parents merely from the fact of a six months child being born living and surviving its birth.
There are, indeed, no justifiable medical grounds for 352 adopting such an opinion a fact clearly brought out by the answer to a question put to the principal medical witness in favour of the alleged antenuptial conception.
He admitted that he had him self seen the case of a six months child who had survived for several days.
He could not assign anyreason why, if after such a period of gestation it is possible to prolong life for days, it should not be possible to extend it to months.
" His only answer was that he was aware of this case, and ob served: "If such speculation can take you away from truth in one direction, it may also take you away from truth in the other direction.
" In re examination, the following passage from Taylor 's Book, 2nd Vol.
10th ed.
at p. 37 was shown to him: "On the other hand, when a child is born with the full signs of maturity, at or under seven months, from possible access of the husband, then there is a strong presumption that it is illegitimate." He expressed agreement with this passage.
The evidence of This witness no doubt contains certain statements, which support the appellant but I agree with the view of Mr. Justice Patel that the witness though undoubtedly a leading obstetrician and gynaecologist, appears to have fenced while answering questions which tended to throw doubt on some of the opinions expressed by him.
His evidence, however, also shows that if the respondent was in the fourth month of pregnancy at the time of the marriage her nausea would not have started soon after her return to Prantij.
In fact, her nausea could have started much earlier, and even at the time of the marriage she should have been suffering from it.
There is no evidence whatsoever to the effect that she had any such nausea at the time of the marriage.
It is not disputed by the appellant that she was suffering from nausea from the time deposed to by her and for a considerable period thereafter.
She could, therefore, not have been in the fourth month of pregnancy towards the end of April, 1947.
For, according to Dr. Ajinkya nausea starts in the first or second month of pregnancy or again in the seventh month of pregnancy.
Therefore, upon this part of Dr. Ajinkya 's opinion, the appellant 's definite case that the pregnancy commenced in November or December, 1946 falls to the ground.
No doubt, the opinions of this witness regarding viability of a child born after five and half months and the weight of such child at birth and the impossibility of its survival support the appellant 's contention.
But these are matters upon which there is divergence amongst experts.
I have 353 already referred to a passage from Taylor which was brought to the notice of this witness with which he disagreed.
This passage as well as that in Peel 's article show that abnormal cases do occur.
Dr. Mehta 's opinions run counter to Dr. Ajinkya 's on certain crucial points.
He has spoken not merely from his own observations as an obstetrician but on the strength of the findings of other scientists.
In this state of affairs can the court say that the appellant has discharged The burden which the law has cast upon him to prove that the respondent was pregnant at the time of the marriage? It is not enough for him to throw a doubt.
He has to establish he fact affirmatively.
No doubt the appellant has examined Dr. Udani, a Pediatrician, but even his evidence does not take the matter any further.
Therefore, I am referring to those passages in his, evidence on which reliance was placed at the hearing and would only say this that what I have said about Dr. Ajinkya 's evidence on similar matters applies equally to Dr. Udani 's evidence.
According to him, a child born 5 months and 17 days after conception would die immediately after birth, though very often it would be a case of miscarriage.
The weight of such a child, according to him, would be 1 1/2 to 2 lbs.
He has agreed with Dr. Ajinkya regarding the normal period; of gestation as well as the period after which a baby becomes viable.
He has admitted in his cross examination that where the weight of a child at birth is 4 lbs.
it would definitely be an indication of premature birth.
The following question was put to him in cross examination: "You were asked by the counsel for the petitioner a little while ago that you could call certain signs as signs of maturity.
Now, as a responsible doctor, I take it that you can do so on the assumption that such symptoms are reliably established or found?" His answer was: "All the signs and symtoms must be established before I can opine on them.
If a baby can take the breast feed well by 3rd day of its life and that baby cries well, even though such a child may according to international definition be a premature one, nonetheless it is a fairly well developed child as far as functions are concerned.
So far as its functions are concerned it is a matured child.
This is particularly true if the mother of the child has the disease like Toxaemia then that baby even if born between 36 and 40th week of pregnancy, that baby will be under weight but it will be a matured child in function.
" L/P P(D) ISCI 12 . 354 Mr. Vimadalal objected to the last part of the answer given By the witness on the ground that it was volunteered by him.
Even, however, if this is taken into account, it makes no difference, because there is no positive evidence to show that them respondent was suffering from toxaemia right till the termination of the pregnancy.
When asked whether in his experience or knowledge he has come across any case in which a child born 26 weeks and four days had survived, his answer was: "I have seen two babies surviving between 27th and 28th weeks.
One in London and one in Boston.
But in these cases exceptional care was required both for delivery as well as for bringing it up.
" This answer to some extent, goes against the opinion of Dr. Ajinkya, though he has qualified it by adding that in most cases such child would be still born and that in exceptional cases it would survive if special care and attention is paid to it.
There remains the evidence of Dr. Mehta who was examined as a witness on behalf of the respondent.
He has also deposed that the period of gestation is counted from the first day of the last menstruation, and in this connection, he relied upon the following passage from British Obstetric and Gynaecological Practice by Sir Eardley Holland and Aleck Bourne, 1955 ed.: "According to Naegele 's rule, which is almost universally employed, seven days are added to the first day of the last menstrual period and nine months added, in order to arrive at the expected date of delivery.
This is really a simple way of adding 280 days of the first day to the last menstrual period, because experience has shown that this is the average duration of pregnancy.
" He also agreed with the following passage from Dougald Baird 's Combined Text Book of Obstetrics and Gynaecology, 6th ed: "It has long been known that the length of gestation in the human is almost ten lunar months (280 days) if calculated from the first day of the last menstrual period." According to him, a four pound full term baby that is one born 280 days after the first day of the last menstrual period, is a rare occurrence.
He was asked the question: "Doctor, if a woman suffers from swelling, i.e. oedema, high blood pressure and passing of albumen in urine, would that have any effect on the period of delivery?", and his 355 answer was that the child would be premature.
He further deposed that oedema, high blood pressure and passage of albumen in urine occur in the second period of pregnancy, but that it might occur earlier if the woman had some trouble, with the kidneys or high blood pressure.
By the second period of pregnancy, he meant after the third month of pregnancy and before the seventh month of pregnancy.
He further stated that nausea in pregnancy usually occurs at the time of the .second missed period, but it might occur before or about the time of the first missed period.
While he agreed with the other medical witnesses examined in this case that the child is supposed to be normal and viable after 28 weeks, he said that there are some exceptions to this and that a child born earlier than the 28th week may be born alive and can survive.
He stated that his statement is based upon the following two passages in De Lee 's book: "De Lee delivered a viable child one hundred and eighty two days after the day of conception and Green Hill delivered a baby one hundred and ninety one days after the beginning of the last menses and one hundred and seventy six days after the last coitus.
The baby weighed 735 gms (1 pound 10 ounces) and survived.
The child is now normal in every way.
The French law recognizes the legitimacy of a child born one hundred and eighty days after marriage and "three hundred days after the death of the husband, the German law one hundred and eighty one and three hundred and two days, respectively.
" He then said the he was familiar with the case of Cark vs Clark,(1) which is also referred to in Taylor 's Medical Jurisprudence, 2nd vol.
10th ed.
at p. 36.
Referring to it, he said: "I agree with the proposition at page 35 of Taylor.
It is as follows: 'Hence it is established that the children born at the 7th or even at the 6th month may be reared. ' I believe the expression month used by the author is Lunar Month.
It also agree with the proposition of Taylor at the same page which runs as under 'It would be in the highest degree unjust to impute illegitimacy to offspring or a want of chastity 356 to the parents merely from the fact of a six months child being born living and surviving its birth '.
" He has also deposed about various matters such as normal labour, calculation of period and so on but it is not necessary to refer to that part of the evidence.
Mr. Desai referring to the opinion of the witness regarding the mode of confirmation of pregnancy within three weeks or so of conception said that the respondent 's admission in a letter of 3rd April, 1947 that her pregnancy was confirmed that day by a doctor who had apparently not performed a biological test would show that conception must have taken place long before the date of marriage.
The letter was not produced by the appellant and so we do not know what exactly she had said in it.
Apart from that it is quite possible that the doctor whom the respondent consulted, as she was having nausea may have tentatively opined that it was pro bably due to the fact that she had conceived.
The opinion of that doctor cannot be placed higher than that.
Relying upon the admissions made by the respondent in the evidence that there was swelling on her hands and feet in the month of June it was argued that she must have then been in the 7th month of pregnancy because according to Dr. Ajinkya this kind of toxaemia appears after the 7th month of pregnancy.
It is to be remembered that she was deposing about this 12 years after the occurrence and as there was no reference to such an important matter in her letters of the 14th June and 2nd July, but only in a subsequent letter, she appears to have made a mistake about the month while depos ing in court.
In fact she first complained about the swellings and high blood pressure only in her letter of the 13th August.
Again even according to Dr. Ajinkya a pregnant woman may develop such troubles in the 4th month if she were suffering from chronic kidney trouble.
There is no evidence about her suffering from such trouble but the possibility of her having such trouble has not been ruled out.
Dr. Mehta has also said that while swellings and high blood pressure usually occur in the second period of pregnancy, he stated that this period would be after the 3rd and before the 7th month of pregnancy and supported his view by reference to a passage at P. 225 from the 'British Obstetric and Gynaecological Practice '.
In this state of evidence, it would not be reasonably safe to conclude that the respondent was in the 7th month of pregnancy in the month of June.
No doubt Dr. Ajinkya has said that there would be a perceptible abdominal enlargement in ordinary cases after the 4th month and the respondent has remarked in her letter 357 of the 28th June that her abdomen had the appearance of a big water pot.
But that was nothing more than innocent exaggeration and ought not to be taken literally.
A good deal of argument was advanced on the footing that the delivery of the respondent being normal, the birth of a premature baby cannot be regarded as a 'normal delivery ' in the medical parlance.
Apart from the fact that Dr. Ajinkya and Dr. Mehta have given different meanings to the expression 'normal delivery ', there is no reliable evidence to the effect that the birth of a child to the respondent was regarded as normal delivery.
As already observed, Madhuben 's evidence is false and artificial and the hospital records consisting of indoor case papers are incomplete.
It would also appear that the column of 'disease ' is torn and attempts to reconstruct it seem to have been made.
Moreover it would seem that entries used to be made in the hospital papers mechanically without reference to actualities.
On these grounds the entry regarding the weight of the child at birthstated as 4 lbs cannot be accepted at its face value.
Even accepting it, there is unanimity of opinion amongst all the three experts examined in this case that this would be the weight of a premature baby and not that of a mature one.
Considered along with the circumstances that the delivery was sudden and the respondent was then in a poor state of health the appellant 's case that the baby was a full term one and, therefore, illegitimate stands disproved.
All that I would say is that the medical evidence adduced in this case for establishing that the respondent had conceived before the marriage can in no sense be regarded as of a definite or conclusive nature.
Indeed, in the case of Clark vs Clark(1).
if the husband was assumed to be the father, the pregnancy could not have exceeded 174 days, and the child which was born, was alive at the hearing and was three years old.
The medical evidence was to the effect that a child of so short a period of foetal life would not survive for more than a day or two.
At the same time, the medical witnesses agreed that only rarely could the date of conception be fixed, and that the periods of gestation generally spoken of were notional periods.
There was no evidence of misconduct on the part of the wife, and the only evidence of adultery was the fact of the birth of a child, the period of gestation of which could not have exceeded 174 days.
The Court held that the husband had not discharged the burden of proof in respect of the adultery and that it was sufficiently proved that the child was conceived in wedlock.
It was further held that "where the date of con ception can be fixed, and the actual period of gestation is (1) (1939) 2 All ~E.R. 59. 358 ascertained, this ascertained period is comparable to the longer notional period, and for this reason what is in fact a six month child may be comparable to what is called a seven months child.
" To sum up, the substance of the medical evidence led on behalf of the appellant is that the normal period of gesta tion of a child is 280 days, that a child born 180 days after the last menstruation is not likely to be born alive or if born alive it will survive only if special care is taken, that such a case would not be that of normal delivery and its weight would be 1 1/2 to 2 lbs.
With the aid of the evidence of Madhuben the appellant has sought to establish that the delivery was a normal one, that the respondent appeared to have delivered at full term and the child born was a normal one.
He has further sought to prove with the aid of the hospital papers that the child weighed four lbs.
or so and was found to be normal one.
Madhuben 's evidence has been rejected by both courts of fact and for very good reasons.
The hospital papers cannot be relied upon in the absence of the white paper.
Besides, a look at the hospital records would suggest that entries therein were made in a casual manner regardless of actualities.
Thus all that we are left with is the evidence of the experts and the case records in text books.
There is no unanimity amongst the three experts and even the text books refer to abnormal cases.
Bearing in mind that the normal period of gestation evolved by the obstetricians is a generalisation deduced from particulars it cannot be regarded as an inflexible law of nature from which there can be no deviation.
Indeed, reputed obstetricians have recorded cases where the period of gestation was found to be shorter in cases of mothers whose menstrual cycles were of three weeks.
Again where toxaemia of pregnancy is found to be considerable the development of a child in the womb has been found to take place more rapidly than in normal pregnancies.
There may be conceivably other factors contributing to the shortening of the period of gestation and a more rapid development of a child in the womb than that which medical science has so far been able to notice.
In these circumstances it would not be reasonably safe to base a conclusion as to the illegitimacy of a child and unchastity of its mother solely on the assumption that because its birth and condition at birth ap peared to be normal its period of gestation must have been normal, thus placing its date of conception at a point of time prior to the marriage of its parents.
Thus, even if the additional evidence is taken into consi deration, the appellant stands on no stronger grounds.
359 It has also to be remembered that on the question as to whether the respondent was pregnant before her marriage not only the High Court but also the City Civil Court has come to the conclusion that she was not.
We have thus concurrent findings of fact on this crucial question.
It is settled law that this Court does not interfere with such a finding merely on the ground that another view of the evidence adduced in the case commends itself to this Court.
The appeal has come before us by a certificate granted by the High Court under article 133(1)(b) of the Constitution.
One of the requirements of cl.
(1) of article 133 is that in a case other than the one referred to in sub cl.
(c) the appeal must involve a substantial question of law where the judgment appealed from affirms the decision of the Court immediately below.
No doubt, strictly speaking, the judgment of the High Court cannot be regarded as judgment of affirmance of the City Civil Court because initially the City Civil Court had granted a decree for annulment of marriage to the appellant.
Substantially, however, the decree of the High Court must be regarded as one of affirmance if we take into consideration the fact that the High Court had affirmed the finding rendered by the City Civil Court on the additional issue framed by the High Court in regard to the question whether the respondent was pregnant at the time of the marriage.
No doubt, technically, the High Courts ' decision is not one of affirmance because it has reversed the decree of the City Civil Court.
But we must have regard to the substance of the matter.
It is true that the City Civil Court had originally granted a decree but the basis of that decree disappeared after it gave a contrary finding to the one rendered by it earlier on the crucial fact concerning the respondent 's pregnancy before her marriage.
The High Court having accepted that finding there can be no escape from the position that we have here a case where upon the crucial question of fact, there are concurrent findings.
Unless it is shown that a concurrent finding is vitiated by an error of law or procedure or unless it is shown that important or relevant evidence has been overlooked or misconstrued it would not be in consonance with the practice of this Court to re examine that finding, particularly when, as here, the findings are based upon an appreciation of evidence.
The Privy Council firmly adhered to this rule and this Court has accepted the Privy Council 's practice in this regard.
There are numerous decisions on the point but I may refer only to the following as instances of cases in which this Court has refused to disturb concurrent findings of fact: Narayan Bhagwantrao Gosavi Balajiwale vs Gopal Vinayak Gosavi & ors.(1); Gherulal Parakh vs Mahadeodas Maiya & ors.(2); Bhinka & others vs (1) (2) [1959] Supp. 2 S.C.R. 406. 360 Charan Singh(1); and Shamrao Bhagwanrao Deshmukh vs
Dominion of India(2).
No case has been brought to our notice in which this Court or the Privy Council has re appreciated evidence in an appeal by special leave or disturbed a pure finding of fact concurrently made by the courts below.
To do so now would be to ignore all precedents.
As already held by me the appeal must be dismissed with costs.
(1) [1959] Supp. 2 S.C.R. 798.
(2) A.I.R. 1955 S.C. 249.
[/INST]For purposes of assessment to income tax, a firm is a different entity distinct from its partners, and a mere change in the constitution of the firm does not bring into existence a new assessable unit or a distinct assessable entity.
(1) 67 I.A. 464,481.
172 A firm consisting of three partners, A, B and C, carried on the business of tea brokers and paid income tax under the Income tax Act of 1918.
There were several changes in the personnel of the partners and in 1939 the firm consisted of C, D and E. C retired and in 1945 a new partnership deed was written up between D, E and F and they carried on the business.
In 1947 the partnership was converted into a limited company.
The Income tax authorities refused to give relief under section 25(4) of the Income tax Act as the partners of the firm in 1939 were different from the partners of the firm in 1947: Held, that in spite of the changes in the constitution of the firm, the business of the firm as originally constituted continued right from its inception to the time it was succeeded by the limited company and the firm was the same unit all through; the reconstitution of the firm in 1945 did not make it a different unit, and the firm was therefore entitled to relief under section 25(4) of the Act.
</s>
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<s>[INST] Summarize the judgementCivil Appeal No. 914 of 1968.
(From the judgment and decree dated the 9th April, 1962, of the Allahabad High Court in first Appeal No. 283 of 1950).
Naunit Lal, K. G. Bhargava and Miss Lalita Kohli for the appellant.
G. section Pathak, D. P. Singh and M. G. Goswami for respondents nos.
1(a) to 1(f).
The Judgment of the Court was delivered by GOSWAMI, J.
This appeal by certificate from the judgment and decree of the Allahabad High Court raises an important question with regard to the construction of a will.
The respondent Gokul (whose heirs have been impleaded after his death) was the original plaintiff in a suit for declaration that he was the absolute owner under a will of the property in suit and for possession of certain of them.
He also claimed certain movable properties with which we are not concerned in this appeal.
The property in suit was originally in exclusive ownership and possession of Bhola Chaubey, the testator.
Bhola Chaubey, was governed by the Mitakshra School of Hindu Law.
He belonged to the class of priests and was an old man of 67 years at the time when he executed the will on September 21, 1916.
He had then a legally wedded wife, Smt, Jarian, approaching nearly her forty fifth year and they had no issue in wedlock.
The only person whom the testator appeared to have almost treated like a son was the respondent Gokul, doubly related to the testator, being his sister 's son and also his wife 's brother 's son.
Gokul had been with him since childhood and the testator got him married.
Gokul in return had been serving the testator to his satisfaction and was in enjoyment of his full confidence and affection till the testator 's death in 1918.
Gokul was then aged about 23 years.
It was directed in the will that Smt.
Jarian would get the obsequies and other religious rites of the testator performed by Gokul.
After the death of the testator Smt.
Jarian and Gokul continued to live in cordiality for nearly 18 years.
Feelings, however, got 927 estranged some time after that and there was even litigation, criminal and civil, between Smt.
Jarian and Gokul.
It appears Smt.
Jarian, who died in March, 1948, had executed a gift deed and a will in respect of certain properties in suit in favour of the appellant, Navneet Lal.
All this led to the institution of the present suit out of which this appeal has arisen.
The case of the appellant was that Bhola Chaubey had given an absolute estate under the will to his wife, Smt.
Jarian, and she was, therefore, entitled to deal with the property as she liked and hence the deed of gift and the will in favour of the appellant were perfectly valid.
According to the appellant the respondent had no right to file the suit basing upon the will executed by Bhola Chaubey.
According to the respondent the will conferred on Smt.
Jarian only a life estate during her life and after her death an absolute estate of the testator 's entire property on the respondent.
The Civil Judge, Mathura, decreed the respondent 's suit except with reference to the movable property mentioned in Schedule O to the plaint as well as in respect of certain muafi zamindari property in Schedule A to the plaint.
The appellant appealed to the High Court at Allahabad and when the matter came up for disposal by a Division Bench of that court, there was a difference of opinion between the Judges.
Srivastava, J. held that the testator had no intention of conferring a limited life estate only on his wife and that she acquired an absolute estate by virtue of the will.
On the other hand, B. Dayal, J. took a contrary view holding that Bhola Chaubey intended to give merely a life estate to Smt.
Jarian and to make Gokul full owner of the property after her death.
The appeal was then set down for hearing before a third Judge, (Dhawan, J.) who agreed with B. Dayal, J. resulting in dismissal of the appeal.
We are concerned in this appeal only with the construction of the will executed in the year 1916.
From the earlier decisions of this Court the following principles, inter alia, are well established: (1) In construing a document whether in English or in vernacular the fundamental rule is to ascertain the intention from the words used; the surrounding circumstances are to be considered; but that is only for the purpose of finding out the intended meaning of the words which have actually been employed.
[Ram Gopal vs Nand Lal and others(1)].
(2) In construing the language of the will the court is entitled to put itself into the testator 's armchair [Venkata Narasimha vs Parthasarathy(2)] and is bound to bear in mind also other matters than merely the words used.
It must consider the surrounding circumstances, the position of the testator, his family 928 relationship, the probability that he would use words in a particular sense. but all this is solely as an aid to arriving at a right construction of the will, and to ascertain the meaning of its language when used by that particular testator in that document.
[Venkata Narasimha 's case supra and Gnanambal Ammal vs T. Raju Ayyar and Others(1)].
(3) The true intention of the testator has to be gathered not by attaching importance to isolated expressions but by reading the will as a whole with all its provisions and ignoring none of them as redundant or contradictory [Raj Bajrang Bahadur Singh vs Thakurain Bakhtraj Kuer(2)].
(4) The court must accept, if possible, such construction as would give to every expression some effect rather than that which would render any of the expression inoperative.
The court will look at the circumstances under which the testator makes his will, such as the state of his property, of his family and the like.
Where apparently conflicting dispositions can be reconciled by giving full effect to every word used in a document, such a construction should be accepted instead of a construction which would have the effect of cutting down the clear meaning of the words used by the testator.
Further, where one of the two reasonable constructions would lead to intestacy, that should be discarded in favour of a construction which does not create any such hiatus.
[Paerey Lal vs Rameshwar Das(3)].
(5) It is one of the cardinal principles of construction of wills that to the extent that it is legally possible effect should be given to every disposition contained in the will unless the law prevents effect being given to it, Of course, if there are two repugnant provisions conferring successive interests, if the first interest created is valid the subsequent interest cannot take effect but a Court of construction will proceed to the farthest extent to avoid repugnancy, so that effect could be given as far as possible to every testamentary intention contained in the will.
[Ramachandra Shenoy and Another vs Mrs. Hilda Brite and Other(4)] Bearing in mind the above principles we may now look at the will in question as a whole.
This will is written in the urdu language.
An official translation is placed on the record.
From the contents of the will we find the background and the exact position of relationship of the parties set out earlier.
Gokul was residing with Bhola Chaubey 929 and Smt.
Jarian.
It may bear repetition that Gokul was held in great love and affection by the testator who was keenly anxious for the welfare both of his wife and of Gokul.
There is yet another feature which is prominent in the will.
The testator was apprehensive of his only brother, Ram Raj and his nephew, Kishnu, who "might trouble his wife and Gokul after his death." From such of the aforesaid prefatory recitals as appear in the will, two objects stand out, namely, that he was deeply interested in the enjoyment of his property movable and immovable after his death by his wife and after her death by Gokul.
The second object was that he intended that his property should not fall into the hands of his brother and nephew who had been separate from him since long after some arbitration and even bore ill will against him and his wife.
After the above revelation of his mental attitude in the will there follows the following recitals: "So long as I, the executant, am alive, I myself shall remain the owner in possession (malik wa qabiz) of my entire movable and immovable property and of the income from Birt Jijmani.
After my death Mst.
Jarian, the wedded wife of me, the executant, shall be the owner (malik) of my entire estate, movable and immovable, and of the income from Birt Jijmani and shall have all the proprietary powers (aur usko jamiya akhtiyarat malikana hasil honge).
After the death of Mst.
Jarian, Gokul aforesaid shall be the owner of the entire estate left by me (malik kamil jaidad matruka meri ka hoga), and he shall have all the proprietary powers and the power of making transfer of all sorts (aur usko jamiya akhtiyarat malikana wa inteqalat har qism hasil honge).
If per chance, Mst.
Jarian dies in my life time, then Gokul aforesaid will be the absolute owner (malik kamil) of the estate left by me (matrura meri) and he shall have power of making all sort of transfers (aur usko har quism ke akhtiyarat inteqalat hasil honge).
Gokul aforesaid should go to Jijmana and should continue to give to Mst.
Jarian during her life time the charitable gifts (daan dakshina) which he brings from there.
After her death he might continue to be benefited thereby.
Jarian should get my obsequies, Barsi (annual death ceremony), Chhamchhi etc.
performed through Gokul aforesaid according to the custom prevalent in the brotherhood.
It will be the duty of Gokul aforesaid to obey and serve my wife Mst.
Jarian.
It will be necessary for Mst.
Jarian to keep my heir (waris) Gokul aforesaid and to act in consultation with him.
At present I have the following immovable properties and the Birt Jijmani.
If in addition to these I purchase or get any property the aforesaid persons shall be the owners of that also according to.
the aforesaid conditions".
Mr. Naunit Lal, on behalf of the appellant, submits that since the testator stated in the will that after his death Smt.
Jarian "shall be the 930 owner (malik) of my entire estate. and shall have all the proprietary powers (aur usko jamiya akhtiyarat malikana hasil honge)", it is absolutely clear that he intended to confer upon his wife an absolute estate to his entire property.
Mr. G. section Pathak, on behalf of the respondents, contests the proposition.
In support of his contention, Mr. Naunit Lal draws our attention to several decisions wherein the word `malik ' has been noticed and explained.
The term `malik ' when used in a will or other document as descriptive of the position which a devisee or donee is intended to hold, has been held apt to describe an owner possessed of full proprietary rights, including a full right of alienation, unless there is something in the context or in the surrounding circumstances to indicate that such full proprietary rights were not intended to be conferred, but the meaning of every word in an Indian will must always depend upon the setting in which it is placed, the subject to which it is related, and the locality of the testator from which it may receive its true shade of meaning.
[Sasiman Chowdhurain and others vs Shib Narayan Chowdhury and others (1) ].
We find observations to the same effect in Musammat surajmani and others vs Rabi Nath ojha and another(2).
It is, approved therein that in order to cut down the full proprietary rights that the word malik imports something must be found in the context to qualify it.
Similarly counsel has referred to the expression `malik mustakil ' which was noticed in a decision of this Court in Krishna Biharilal vs Gulabchand and Ors.(3), and this Court observed at page 31 as follows: "The meaning of the expression `malik mustakil ' an urdu word, has come for consideration before this Court in some cases.
In Dhyan Singh and anr.
vs Jugal Kishore & Anr.(4), this Court ruled that the words `malik mustakil ' were strong, clear and unambiguous and if those words are not qualified by other words and circumstances appearing in the same document, the courts must hold that the estate given is an absolute one We are, however, not required to consider the words `malik mustakil ' in this case.
But it is clear that even those words can be qualified by other words and circumstances appearing in the same document.
It is, therefore, abundantly clear that the intention of the testator will have to be gathered from all the relevant and material contents in the entire will made in the situation in which the testator was placed in life in the back ground of his property, his inclinations, wishes, desires and attitudes as can be clearly and unambiguously found either from the recitals from the instrument or from absolutely undoubted contemporaneous legally admissible evidence.
931 Reading the present will as a whole and if every disposition has to be rationally harmonised, we find that the testator intended a life estate for his wife so long as she lived.
This is consistent with his description of Gokul as "my heir (waris)" after his death.
It is further consistent with the recital that "if per chance, Mst.
Jarian dies in my life time, then Gokul aforesaid will be the absolute owner (malik kamil) of the estate left by me (matruka meri) and he shall have power of making all sorts of transfers (aur usko har quism ke akhtiyarat inteqalat hasil honge)".
In obvious contrast even though Smt.
Jarian was made the malik of his entire estate after his death "having all the proprietary rights" nothing is stated about her "power of making all sorts of transfers" which power is expressly mentioned as belonging to him and also exclusively conferred upon Gokul after Smt.
Jarian 's death.
While describing his own "proprietary powers" the testator made reference to his "power of making transfers of all sorts".
This power of making transfer which was prominent in the mind of the testator at the time of execution of the will is conspicuous by total omission in relation to Smt.
Jarian 's enjoyment of the property.
We have to give due importance to the lexicon in the will and we find that the testator has made a definite distinction between mere ownership of property and ownership of the same coupled with powers of transfer "in every way".
Ordinarily, however, without such clear evidence from the recitals in the will itself it may not be possible to hold that ownership of property, which is devised, without any thing more, would not connote absolute ownership of the same with the power of alienation.
There is another significant feature in the recitals, when reference is made in the will to acquisition of future property.
Says the testator "if in addition to these I purchase or get any property the aforesaid persons shall be the owners of that also according to the aforesaid conditions".
The testator thus unerringly conceives of any future property being owned by both, by the widow during her life time and by Gokul after her death in the same manner as the property that had already been bequeathed.
The expression "according to the aforesaid conditions" is, therefore, very significant in the context.
We also find that during her life time Gokul would be collecting "daan dakshina" of the jijmani to Smt.
Jarian and after her death Gokul would enjoy the same.
There is no contemplation of any possibility to deprive Gokul of the enjoyment of the property in any event.
All the above features run counter to the theory of an absolute estate in favour of Smt.
Jarian.
There is still another clinching factor.
It is clear from the will that the testator had misunderstanding and quarrels with his brother regarding ancestral property and the matter had to be settled by arbitration leading to partition and separate enjoyment of property as far back as 1889.
It also appears from the recitals in the will that he had grave apprehension that after his death his only reversioners, his brother and nephew, "might trouble and harass my wife Mst.
Jarian and my sister 's son Gokul.
" One thing was, therefore, clear that the testator never intended that his property should pass to his brother and nephew.
This intention of the testator would 932 best be achieved by holding that there was a devise of a life estate to his wife and an absolute estate thereafter to Gokul indicating a different line of inheritance in the will.
On the other hand, if any absolute estate would have been conferred on the widow, then on her death the property would have passed on by inheritance to her husband 's heirs who were none else than the brother and the nephew of the testator.
There was no other heir of Mst.
Jarian to inherit the property after her death.
A Plenitude of absolute estate in favour of the wife will make the absolute bequest to Gokul void in law.
No such repugnant interpretation detrimental to the interest of Gokul can be made in the light of the entire tenor of the instrument.
Having regard to the context and the circumstances apparent from the will, we are clearly of opinion that the testator intended to bequeath in favour of his widow only a life estate and after her death an absolute estate to Gokul.
That being the position the will by Smt.
Jarian in favour of the appellant fails and her gift in favour of the appellant also similarly fails on her death.
The respondent 's suit is rightly decreed by the courts below.
The appeal fails and is dismissed.
We will, however, make no order as to costs.
S.B. Appeal dismissed.
[/INST]One 'BC ', governed by the Mitakshra School of Hindu Law, being issueless and apprehending the claim to his property after his death as reversioners by his only brother 'RR ' and his nephew 'K ' who were inimical to him since the partition of their ancestral property in 1899, and possible harassment of his wife and 'G ', the respondent, executed a Will on September 21, 1916, in the Urdu script.
The respondent 'G ' being the son of the testator 's sister married to testator 's wife 's brother was doubly related.
As per the Will, 'G ' was to perform the obsequies and other annual death ceremonies etc.
, being his 'waris ' and the "Malik Kamil ' absolute owner" having all the proprietary powers and the power of making transfers of all sorts", while his wife was to be in possession and enjoyment of the property during her life time.
From the date of death of the testator in 1918 for about 18 years the widow and 'G ' lived in cordiality but got estranged later due to estrangement of feelings resulting in several civil and criminal litigation between them.
The widow died in 1948 executing a gift deed and a Will in respect of certain properties in favour of the appellant 'NL '. 'G ' filed a civil suit claiming his rights under the Will dated 21 September, 1916, and the appellant defendant contested it on pleas that the widow of 'BC ' having an absolute right over the property under the said Will validly made the gift deed and the Will of 1948 in his favour and that the respondent plaintiff had no locus standi to file the suit.
The suit was decreed.
On appeal to the Allahabad High Court, as there was a difference of opinion between the Judges of the Division Bench on the nature of the widow 's estate, one opining as the Will conferring a "limited estate" and the other opining as conferring an "absolute estate" the appeal was set down to a third Judge who agreed with the view that the Will conferred only a "limited estate" upon the widow and dismissed the appeal.
Confirming the decree of the courts below and dismissing the appeal by certificate, the Court, ^ HELD : (1) The following are the established principles for construing the language of the Will.
(a) In construing a document whether in English or in vernacular the fundamental rule is to ascertain the intention from the words used; the surrounding circumstances being considered to find out the intended meaning of such words employed therein.
[927F G] (b) In construing the language of the Will the court is entitled to put itself into the testator 's armchair and is bound to bear in mind also other matters than merely the words used like the surrounding circumstances, the position of the testator, his family relationship, the probability that he would use words in a particular sense all as an aid to arriving at a right construction of the Will, and to ascertain the meaning of its language when used by that particular testator in that document.
[927G H, 928A] (c) The true intention of the testator has to be gathered not by attaching importance to isolated expressions but by reading the Will as a whole with all its provisions and ignoring none of them as redundant or contradictory.
[928B] (d) The court must accept, if possible, such construction as would give to every expression some effect rather than that which would render any of 925 the expression inoperative.
The court will look at the circumstances under which the testator makes his Will, such as the state of his property, of his family and the like.
Where apparently conflicting dispositions can be reconciled by giving full effect to every word used in a document, such a construction should be accepted instead of a construction which would have the effect of cutting down the clear meaning of the words used by the testator.
Further, where one of the two reasonable constructions would lead to intestacy, that should be discarded in favour of a construction which does not create and such hiatus.
[928C E] (e) It is one of the cardinal principles of construction of Wills that to the extent that it is legally possible effect should be given to every disposition contained in the Will unless the law prevents effect being given to it.
Of course, if there are two repugnant provisions conferring successive interests, if the first interest created is valid the subsequent interest cannot take effect but a court of construction will proceed to the farthest extent to avoid repugnancy, so that effect could be given as far as possible to every testamentary intention contained in the Will.
[928E G] Ram Gopal vs Nand Lal and others ; Venkata Narasimha vs Parthasarathy, 42 Indian Appeals 51/72; Gnanambal Ammal vs T. Raju Ayyar and others, ; Raj Bajrang Bahadur Singh vs Thakurain Bakhtraj Kuer, ; Pearey Lal vs Rameshwar Das [1963] Supp.
SCR 834/839/842 and Ramachandra Shenoy and Anr.
vs Mrs. Hilda Brite and others. , applied.
(ii) The term "malik" when used in a Will or other document as descriptive of the position which a devisee or donee is intended to hold, has been held apt to describe an owner possessed of full proprietary rights, including a full right of alienation, unless there is something in the context or in the surrounding circumstances to indicate that such full proprietary rights were not intended to be conferred, but the meaning of every word in an Indian Will must always depend upon the setting in which it is placed, the subject to which it is related and the locality of the testator from which it may receive its true shade of meaning.
The intention of the testator will have to be gathered from all the relevant and material contents in the entire Will made in situation in which the testator was placed in life in the background of his property, his inclinations, wishes, desires and attitudes as can be clearly and unambiguously found either from the recitals from the instrument or from absolutely undoubted contemporaneous legally admissible evidence.
Hence, even the words "malik muakkil" can be qualified by other words and circumstances appearing in the document.
[930 B C & G H] Sasiman Chowdhurain and others vs Shib Narayan Chowdhury and others, 49 Indian Appeals 25/35; Musammat Surajmani and others vs Rabi Nath Ojha and another, 35 Indian Appeals 17; Krishna Biharilal vs Gulabchand and others, (1971) Supp.
SCR 27 and Dhyan Singh and anr.
vs Jugal Kishore and anr.
, [1952] SCR 478, discussed.
(iii) In the instant case, the testator intended a life estate for his wife so long as she lived as is clear from the reading of the present Will as a whole.
This is consistent with his description of Gokul as "my heir (waris)" after his death.
It is further consistent with the recital that "if per chance, Mrs. Jarian dies in my life time, then Gokul, aforesaid will be the absolute owner (malik kamil) of the estate left by me (matruka meri) and he shall have power of making all sorts of transfers (aurusko har qism ke aktiyarat inteqalat hasil honge)".
In obvious contrast even though Smt.
Jarian was made the malik of his entire estate after his death "having all the proprietary rights" nothing is stated about her "power of making all sorts of transfers" which power is expressly mentioned as belonging to him and also exclusively conferred upon Gokul after Smt.
Jarian 's death.
While describing his own "proprietary powers" the testator made reference to his "power of making transfers of all sorts".
This power of making transfers which was prominent in the mind of the testator at the time of execution of the Will is conspicuous by total omission in relation to Smt.
Jarian 's enjoyment of the property.
The testator has made the distinction between mere ownership of property and ownership of the same coupled with a transfer in every way.
[931 A D] 926 Further, from the recitals in the Will about his only reversioners viz., his brother and nephew "might trouble and harass my wife Mst.
Jarian and my sister 's son Gokul", it is clear that the testator never intended that his property should pass to his brother and nephew.
This intention would be achieved by holding that there was a devise of a life estate to his wife and an absolute estate thereafter to Gokul indicating a different line of inheritance in the Will on the other hand, if any absolute estate would have been conferred on the widow, then on her death the property would have passed on by inheritance to her husband 's heirs who were none else than the brother and the nephew of the testator.
There was no other heir of Mst.
Jarian to inherit the property after her death.
[931 G H, 932 A B] A plenitude of absolute estate in favour of the wife will make the absolute bequest to Gokul void in law.
No such repugnant interpretation detrimental to the interest of Gokul can be made in the light of the entire tenor of the instrument.
The testator intended to bequeath in favour of his widow only a life estate and after her death an absolute estate to Gokul.
[932B C]
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<s>[INST] Summarize the judgementCivil Appeals Nos.
1912 1914 of 1976.
(Appeal by special Leave from the Judgment and order dated 7 2 1975 of the Madhya Pradesh High Court in Misc.
Petition No. 231/74 and 685 and 732/73 respectively.) I.N. Shroff and H.S. Parihar, for the appellants.
S.K. Gambhir, for respondents Nos. 1 and 2.
The Judgment of the Court was delivered by FAZAL ALI, J.
In this appeal by special leave, on an application filed by the respondents before the High Court of Madhya Pradesh, the High Court struck down the constitu tional validity of sub section
(5) (a) of section 37 of the Madhya Pradesh Krishi Upaj Mandi Adhiniyam, 1972 hereinafter referred to as 'the Act ' (No.
24 of 1973).
The impugned sub section runs as follows: "(5) Every commission agent shall be liable (a) to keep the goods of his principal in safe custody without any charge other than the commission payable to him; and" 620 The High Court thought that this statutory provision places unreasonable restriction on the commission agent and puts great burden on him for storing the goods given to him by the principal without charging the commission for its safe custody.
The Act is a social piece Of legislation and should have been liberally construed so as to advance the object of the Act and fulfil the aims to be achieved there by.
The main purpose of the Act is to secure a scientific method of storage, sale, distribution and marketing of agricultural produce and cut out as far as possible middle man 's profit.
The Act, therefore, contains provisions of a beneficial nature preventing profiteering tendencies.
It is not, however, the hardship that can be termed unreasonable so as to make a statute unconstitutional.
Moreover, the High Court does not appear to have looked to.
the scheme of the Act and has in fact completely overlooked the provisions of section 37(4) which runs as follows: "(4) The commission agent shall recover his commission only from his principal trader at such rates as may be specified in the bye laws including all such expenses as may be incurred by him in storage of the produce and other services rendered by him." This section clearly empowers the commission agent to charge such rates as may be specified by the bye laws even for the storage of the Produce and other services rendered by him.
This provision also does not prevent the commission agent from levying reasonable charges for the storage over and above his commission.
All that the Act prevents is that the commission agent is prohibited from levying any charges for safe custody from the farmer or the principal.
This is done in order to attract and lure the farmers to place their goods with commission agents without additional payment of charges for safe custody.
Section 37 (4), however, compen sates the commission agent by authorising him to charge his commission and all expenses which may be incurred by the commission agent in connection with the storage of the produce and the services rendered by him.
This section, therefore, clearly authorises the commission agent not only to charge his commission from the principal trader but also expenses incurred by him for the purpose of the storage.
That apart section 2(e) of the Act whiCh defines a "Commission agent" empowers him to charge any commission o.r percentage upon the amount involved in such transaction.
For these reasons, therefore, we do not see any hardship or unreasonableness in the provisions Of section 37(5)(a) of the Act.
The High Court, therefore, committed an error of law in striking down this provision as unconstitutional.
In our opinion, therefore, section 37 (5) (a) of the Act is constitu tionally valid.
In the view we take, it is not necessary to go into the question whether the law violates article 19 of the Constitution which stands suspended during the emergen cy.
The appeal is accordingly allowed.
The order of the High Court is quashed.
In the circumstances, there will be no order as to.
costs.
M.R. Appeal al lowed.
[/INST]Rule 23 of the Assam Agricultural Income tax Rules, 1939 provides that where an order apportioning the liability to the tax on the basis of partition has not been passed in respect of a Hindu undivided family hitherto.
assessed as undivided or joint, such family shall be deemed, to continue to be a Hindu undivided or joint family.
The assessee was the Karta of a Hindu undivided family, which was assessed to agricultural income tax in respect of income derived from the manufacture and sale of tea.
The assessee contended before the Agricultural Income tax Officer that, since there was disruption of the Hindu undi vided family, no agricultural income tax was payable exen though agricultural income had arisen from tea estates.
This plea was rejected.
His petition under article 226 of the Constitution impugning the validity of r. 23 had been dis missed by the High Court.
In appeal to this Court it was contended that (i) after the dissolution of the family no assessment order could be made under r. 23 in respect of such disrupted Hindu Undi vided family (ii) the State Government had no power to make a rule for the assessment of a Hindu undivided family after a partition took place in the family.
Dismissing the appeals, HELD: (1) The language of r. 23 clearly warrants the conclusion that in the absence of an order apportioning the liability to tax on the basis of partition in respect of a Hindu undivided family hitherto assessed as undivided or joint, such family shall ,be deemed, for the purpose of the Act to continue to be a Hindu Undivided family.
No order apportioning the liability to, tax on ' the basis of the alleged partition having been passed, the family shall continue be treated as a Hindu undivided family.
[651 C F] 2(a) The liability for tax having been created by the charging section, the rule deals with the question as to who should be the person that should be assessed to tax.
This is a matter of detail to carry out the purposes of the and the State Government was well within its competence to make the rule in exercise of its rule making power.
[652 C D] (b) The fact that.
unlike the Income tax Act, there is no statutory provision in the Act and the matter is dealt with by the rules, would not make any material difference.
The rules would be as much binding as would be statutory provision in t,his respect.
[652 E F] (c) It is well settled that it is not unconstitutional for the legislature to leave it to the executive to deter mine the details relating to the working of taxation laws.
such as selection of persons on whom the tax is to be levied.
the rate at which it is to be charged in respect of different classes of goods and the like.
[652 G H] Pt.
Banarsi Das vs State of Madhya Pradesh [1959] S.C.R. 427, followed.
Powell vs Appollo Candle Company Limited [1885] 10 A.C. 282 and Syed Mobgreed & Co. vs The State of Madras 3 S.T.C. 367, referred to. 646
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<s>[INST] Summarize the judgementAppeal No. 579 of 1965.
Appeal from the judgment and decree dated April 20, 28, 1960 of the Bombay High Court (Now Gujarat High Court) in Appeal No. 172 of 1956 from Original Decree.
N.S. Bindra, M.S.K. Sastri and S.P. Nayar, for the appellant.
S.T. Desai, Y.S. Chitale and D.N. Misra.
for the respondent.
The Judgment of the Court was delivered by Bachawat, J.
In January 1948 in view of the imminent constitutional changes in the Baroda State, it was considered likely that the services of the Diwan Sri Sudhalkar, the appellant and Sri Gaekwad, the three official members of the Executive Council of the State would be prematurely terminated.
The respondent was then 'drawing a salary of Rs. 2,000/ per month and was to retire on February 14, 1952 on reaching the superannuation age of 56 years.
On January 28, 1948 His Highness the Maharaja of Baroda enhanced the respondents salary to Rs. 2,500/ per month.
By separate orders the salaries of other official member 's also were enhanced.
By a Huzur order dated February 8, 1948 the Maharaja fixed the pension and other retirement benefits of the respondent and Sri Gaekwad.
The order was in these terms : "His Highness the Maharaja Saheb has been pleased to order that in the event of premature retirement of the Government Members, Messrs. D.V. Gaekwad and Chandrachud, they will get forthwith as compensation an amount equivalent to the total ,amount they would have received had they continued in service up to.
the date of retirement and a full pension of Rs. 500 per month from the date of the premature retirement.
Mr. D.V. Gaekwad 's salary is raised to Rs. 2,000/ from the date of his confirmation as Naib Dewan.
" On the same date the Maharaja by a separate order fixed the pension and retirement benefits of Sri Sudhalkar.
On May 18, 1948, the Maharaja directed the compulsory retirement of the respondent with effect from June 1, 1948.
Soon thereafter the respondent drew from the State Treasury Rs. 95,196/4/ on account of compensation allowance.
On June 1, 1948 he retired 758 from service.
On the same date Dr. Jivraj Mehta became the Diwan and President of the Executive Council in place of Sri Sudhalkar.
On the representations of Dr. Jivraj Mehta the Maharaja passed another Huzur order on July 22, 1948 modifying his previous orders and directing that the respondent and the other officials would draw pension only as and when they would reach the age of retirement and that the respondent would in addition draw the salary to which he might be eligible under the Account Rules.
In October 1948 there was correspondence touching the Huzur Orders between the Maharaja and Dr. Jivraj Mehta.
On April 22, 1949 the Executive Council of the State of Baroda headed by Dr. Jivraj Mehta purported to review and set ,aside the Huzur Orders with respect to payment of compensation to the retiring officials and directed that (1 ) the respondent would get 4 months ' privilege leave salary and as from April 1, 1949 the pension of Rs. 500/ per month sanctioned by the Maharaja, (2) the amount received by the respondent as compensation be forfeited to the State and returned by him to the Treasury; (3) Rs. 77,416/consequently due from him after taking into account his salary and pension up to March 31, 1949 be recovered from him under section 148 of the Baroda Land Revenue Code.
Pursuant .to thistle the respondent 's properties were attached on April 26, 1949.
The respondent was compelled to refund to the State Treasury Rs. 55,000/ on April 27, 1949 and Rs. 10,000/on April 29, 1949.
On March 14, 1952 the Collector of Baroda sent a notice to the respondent demanding payment of the balance of Rs. 12,416/ .
The respondent continued to draw pension at the rate of Rs. 500/per month from April 1, 1949.
On April 17, 1952 he gave notice of his intention to file the present suit under section 80 of the Code of Civil Procedure.
On June 23, 1952 he instituted the suit against the State of Bombay asking for a declaration that the Huzur order dated FebrUary 8, 1948 ,as modified by the Huzur order dated July 22, 1948 was valid and binding on the defendant, a declaration that the order of the Executive Council dated April 22, 1949 was invalid, an injunction restraining the defendant from recovering Rs. 12,416/ and a decree for Rs. 65,000/ and interest thereon totaling Rs. 77,300/ , future interest and costs.
On August 31, 1955, the Trial Court decreed the suit.
On appeal, the High Court held that the respondent was entitled to recover Rs. 65 '000/ 'only without interest and was liable to refund Rs. 17,250/ drawn on account of pension from April 1.
1949 up.
to February 14, 1952.
Consequently, the High Court reduced the money decree to Rs. 47,750/ give proportionate costs and confirmed the rest of the decree.
The present appeal has been filed by the State of Gujarat after obtaining a certificate from the High Court.
It is necessary at this stage to refer to the constitutional and political changes culminating in the merger of Baroda State in the 759 Province of Bombay.
The Maharaja of Baroda enjoyed internal.
sovereignty in the State under the suzerainty of the British crown.
In 1940 the Maharaja enacted the Government of Baroda Act 1940, (Act No. VI of 1940).
Section 3 provided that Baroda would continue to be governed by the Maharaja and that all rights, authority and jurisdiction appertaining to its government was exercisable by him except as provided in the Act or "as may be otherwise directed by His Highness.
" Section 4 preserved all the Maharaja 's powers, legislative, executive and judicial, in relation to the State and its government and his right and prerogative to make laws, and issue proclamations, orders and ordinances by virtue of his inherent authority.
Section 5 vested the executive ' authority of the State in an Executive Council consisting of the Dewan and other members chosen by the Maharaja and holding office during his pleasure subject to the other provisions of the Act and the directions given by the Maharaja.
Section 18(d) provided that no Bill affecting any order passed by the Maharaja in exercise of his prerogative could be moved in the Dhara Sabha without the previous sanction of the Maharaja.
Section 32(f) provided that pensions and gratuities sanctioned by the Maharaja would be expenditure charged on the revenues of the State.
On August 15, 1947 the Indian Independence Act, 1947 was passed and the paramountcy of the British crown lapsed.
On the same date the State of Baroda acceded to the Dominion of India.
Under the Instrument of Accession the Maharaja of Baroda ceded to the Dominion legislature the power to legislate for the State of Baroda with respect of defence, external affairs and communications.
The advent of independence in India gave momentum to the popular movement for transfer of power from the Maharaja to the people and for formation of a responsible government in the State.
On January 9, 1948 the Maharaja issued a proclamation directing the formation of a body elected on the basis of ,adult franchise frame a Constitution for the State subject to certain reservations and announcing his intention to appoint popular representatives, to the Executive Council.
By another proclamation dated August 25, 1948 the Maharaja announced that (1) the Constitution framing assembly would have full and unrestricted authority to frame a Constitution for the State in respect of all matters and subjects; (2) the entire executive authority of the State would immediately vest in the Executive Council, the Government of Baroda Act would stand amended ,accordingly and the words "or as may be ' otherwise directed by His Highness" occurring in section 3 and the whole of section 4 of the Act would be deemed to be omitted; On September 16, 1948 the Maharaja promulgated the Baroda State Executive Rules.
Rule 6 provided that "the Executive Council shall have the entire executive authority in regard to the administration of the State in ,all matters without any reservation.
" On March 21, 1949 the Maharaja executed the Baroda Merger Agreement whereby ' 760 he ceded to the Dominion Government full authority, jurisdiction and powers for and in relation to the governance of the State and agreed to transfer the administration of the State to the Dominion Government on May 1, 1949.
On May 1, 1949 the administration of the State was made over to the Dominion Government.
As from that date, all sovereign powers of the Maharaja of Baroda ceased and the Dominion Government acquired full and exclusive extra provincial jurisdiction for and in relation to the governance of the State of Baroda.
By a notification No. 101 P dated May 1, 1949 the Central Government in exercise of its powers under section 3(2) of the Extra Provincial Jurisdiction Act, 1947 delegated to the Provincial Government of Bombay its aforesaid extra provincial jurisdiction including the powers conferred by section 4 of that Act to make orders for the exercise of the jurisdiction.
By notification No. 4530/46F of the same date, the Government of Bombay in exercise of the powers conferred by section 4 of the Extra Provincial Jurisdiction Act, 1947 repealed the provisions of the 'Government of Baroda Act excepting sections 1, 2 and 36 to 45 with immediate effect.
On the same date the Government of Bombay promulgated the Administration of the Baroda State Order Paragraph 3 of the Order vested the executive authority of the State in a special commissioner, subject to the supervision and control of the Bombay Government.
Paragraph 4(i)(b) provided for the continuance of (a) of any law, or (b) of any notification, order, scheme, rule, form or bye law issued, made or prescribed under any law as were in force immediately before May 1, 1949 in the Baroda State.
On July 23, 1949 the Government of Bombay promulgated the Bombay State (Application of Laws) Order 1949.
Paragraph 3 of the Order provided for the extension and continuance of certain laws to the Baroda State.
Paragraph 5 repealed sections 1, 2, and 36 to 45 of the Government of Baroda Act and certain other enactments.
Paragraph 5(iii)(a) provided 'that the repeal would not affect any right, title, obligation or liability already acquired, accrued or incurred, or any remedy or proceeding in respect thereof.
On July 27, 1949 the Governor General in exercise of his powers under section 290A of the Government of India Act, 1935 promulgated the States ' Merger (Governors Provinces) Order 1949.
Paragraph 3 of the Order provided that Baroda would be merged in the province of Bombay and administered in all respects as if it formed 'part of that Province.
Paragraph 4 provided for the continuance of laws then in force in the merged State.
Paragraph 7 (1 ) provided that all liabilities in respect of such loans, guarantees and other financial obligations of the Dominion Government as arose out of the governance of a merged State, would as from August 1, 1949 be liabilities of the absorbing Province, unless the loan, guarantee or other financial obligation was relatable to central purposes.
Paragraph 9 provided that any proceedings which if the order had not been passed 761 night lawfully have been brought in the merged State against the Dominion might in the case of any liability arising before August 1, 1949 be brought (a) against the Dominion if the proceedings could have been brought against the Dominion had the liability arisen after that date and (b) otherwise against the absorbing Province.
The questions arising for determination in this appeal are as follows : (1 ) Was the order of the Executive Council dated April 22, 1949 ultra vires its powers and invalid and not binding on the respondent; (2) Was the Government of Baroda liable to pay the sum of Rs. 65,000/ to the respondent; and (3) if so, has the liability devolved upon the State of Gujarat.
The Executive Council Rules made by the Maharaja of Baroda on September 16, 1948 vested in the Executive Council the entire executive authority in regard to the administration of the Baroda State in all matters without any reservation.
The Executive Council had very wide powers, but, in our opinion, they had no authority to override and rescind the Huzur orders passed by the Maharaja himself.
The prerogative and inherent powers of the Maharaja was not delegated to the Executive Council.
The Maharaja was still the sovereign ruler.
The members of the Executive Council were responsible to him and held office during his pleasure.
No appeal lay from his order to the Executive Council On the contrary under Rule 46 of the Privy Council Rules promulgated on December 18, 1947 an appeal lay to the Maharaja from an order passed by the Executive Council.
In view of section 18(d) of the Baroda Constitution Act 1940 even a legislative bill affecting an order passed by the Maharaja in the exercise of his prerogative rights could not be moved in the Dhara Sabha without his previous sanction.
Under section 32(f) pensions and gratuities sanctioned by the Maharaja were charged on the revenues of the State.
The Fluzur order was passed by the Maharaja on February 8, 1948 in the exercise of his prerogative and inherent powers.
The order was executed and the monies were paid under it to the respondent.
The Executive Council had no authority to revoke the Huzur order and to forfeit the monies.
We hold that the order of the Executive Council dated April 22, 1949 was ultra vires its powers and was illegal and not binding upon the respondent.
It is now conceded that the direction in the order dated April 22, 1949 for the recovery of monies under section 148 of the Baroda Land Revenue Code was illegal.
That section did not allow recovery of moneys payable under an order of the Executive 762 Council.
The attachment levied on the respondent 's properties was unlawful.
The recovery of Rs. 65,000/ from the respondent, under the invalid order of the Executive Council cannot be justified as an act of State.
The Courts below rightly found that the respondent was compelled to pay Rs. 65,000/ under coercion.
The result of the illegal recovery was that to the extent of Rs. 65,000/ the Ii, ability of the Baroda Government under the Huzur Order dated February 8, 1948 remained outstanding.
The main question arising in the appeal is whether the liability the Baroda Government under the Huzur order dated February 8, 1948 devolved upon the successor governments after the merger of the Baroda State on May 1, 1949.
The view which currently prevails in this Court is that in cases where the Government of India has acquired the territory of a sovereign Indian State either by conquest, treaty, cession or otherwise the privileges and rights obtained from the predecessor State cannot be enforced by action against the Government of India, see M/s. Dalmia Dadri Cement Co. vs The Commissioner of Income tax(1) (cession of Jind), pema Chibar vs Union of India(a) (conquest of Daman), nor can it be sued in the municipal courts for the debts 'and contractual liabilities of the predecessor, see jagannath Agarwala vs State of Orissa(3) (Cession of Mayrbhunj), Firm Bansidhar Premsukhdeo vs State of Rajasthan(4) (Bharatpur), unless it has chosen, to recognise the right, privilege, debt or liability by legislation, agreement, or otherwise.
The rule extends to the acts of the predecessor State after its accession to the Dominion of India on August 15, 1947 and before its complete merger in the Dominion.
In State of Gujarat vs Fiddali(5) the Ruler of Sant State issued a resolution or Tharao granting certain forest rights on March 12, 1948 after the accession of the State to the Dominion.
On June 10, 1948 he transferred the administration of the State to the Dominion under a merger ,agreement dated March 19, 1948.
The Court held that the Tharao was not binding upon the successor government.
It was said that the Rulers of the Indian States parted with their sovereignty in successive stages, firstly on accession, and finally on merger.
As a result of accession, the Dominion of India acquired power to legislate for the territories of the acceding state in respect of defence, external affairs, and communications.
Under section 5 of the Indian Independence Act the Dominion was as from August 15, 1947 a union comprising the acceding State.
But the acceding State continued to retain its separate existence and individual sovereignty until its complete merger in 'the Dominion.
(1) [1959] S.C.R. 729.
(2) ; (3) ; (4) ; (5) ; 763 The question then is whether the successor governments recognized the rights and liabilities under the Huzur order dated February 8, 1948.
The onus of proving the recognition is upon the respondent, see Valesinghji Joravarsingji vs Secretary of State for India(1).
The recognition "may be either express or may be implied from circumstances and evidence appearing from the mode of dealing with those rights of the new sovereign," see State Gularat vs Fiddali(2).
On behalf of the respondent it was argued that the Huzur Order dated February 8, 1948 was a law and as such was recognised and continued in force by the Government of India.
We axe unable to accept this contention.
A grant made by the Ruler of an Indian State is not a law, see State of Gujarat vs Fiddali(2), 461 (grant of forest rights), R.N. Pratap Singh Deo vs State of Orissa(a) (grant of khorposh allowance), Union of India vs Gwalior Rayon Silk Manufacturing (Weaving) Co.(4) (grant of exemption from taxation), State of Madhya Pradesh vs Lal Bhargavendra Singh(5) (grant of maintenance allowance), nor is an agreement executed by the Ruler a law, see Maharaja Shri Umaid Mills Ltd. vs Union of India(6).
Accordingly, it was held in State of Madhya Pradesh vs Col.
Ram Pal(7) that an order granting retirement pension in relaxation of the State Pension and Gratuity Rules was not a law.
The Huzur order dated February 8, 1948 did not lay down a rule conduct for the official members of the Executive Council generally.
It fixed the retirement benefits of the respondent and of Gaekwad and enhanced Gaekwad 's salary.
A separate order fixed the retirement benefits of Sudhalkar, the other official member.
The order concerning the respondent was an executive act and had none of the characteristics of law unlike other laws it was not published in the Adhya Patrika or the official gazette of Baroda State.
We hold that the order was not a law.
The next question is whether the Baroda merger agreement dated March 21, 1949 recognised the rights and liabilities under the Huzur Order dated February 8, 1948.
Now the Articles of the merger agreement may furnish valuable evidence of the affirmance of rights conferred by the predecessor State, see M/s. Dab mia Dadri Cement Co. Ltd. vs The Commissioner of Income tax(s).
In the State of Madhya Pradesh vs Shyam Lal(9) a recognition of those rights was inferred from articles in merger agreements providing for the continuance of the laws of the merging State and for the taking over its assets and the liabilities by the new State.
In the present case article VIII of the merger agreement (1) (1924) L.R. 51 I.A. 357, 361.
(2) ; at p. 510.
(3) ; (4) ; (5) ; (6) [1963] Supp. 2 S.C.R. 515.
(7) ; (8) [1959] S C.R. 729 at p. 748.
(9) 764 dated March 21, 1951 provided : (1 ) The Government of India hereby guarantees either the continuance in service of the permanent members of the Public Services of Baroda on conditions which will be less advantageous than those on which they were serving before the date on which the administration of Baroda is made over to the Government of India or the payment of reasonable compensation.
(2) The Government of India further guarantees the continuance of pensions and leave salaries sanctioned by His Highness the Maharaja to the members of the public services of the State who have retired or proceeded on leave preparatory to retirement, before the date on which the administration of Baroda is made over to the Government of India.
Clause (2) of article VIII applies to the respondent.
.He was member of the public services of the Baroda State, and he retired before the date of the merger.
It guarantees the continuance of the pension and ' leave salary sanctioned to him by the Maharaja.
Now what does the word "pension" in clause (2) of article VIII mean? Ordinarily the word "pension" means a periodical allowance of money granted by the Government in consideration or recognition of meritorious services.
The word "pension" in the , section 60(1)(g) of the Code of Civil Procedure,1908 and section 6(g) of the implies periodical payments of money by Government to the pensioner, see Nawab Bahadur of Murshidabad vs Karnani Industrial Bank Ltd.(1) Pension, gratuity and provident fund are three distinct types of retirement benefits.
But the word "pension" (pensionem, payment) in its widest etymological sense can be construed as including all payments of every kind and description to a retiring government servant, see Secretary of State vs Khemchand jeychand(2).
The term "pension" is frequently, particularly in recent years, used in the broad sense of retirement allowance or adjusted compensation for services rendered, see Corpus Juris Secundum, Vol. 67, page 331; Vol. 70, page 425.
It has received the wider connotation in the definition sections of many modern statutes.
To give a few illustrations, the word "pension" includes "any payment of a lump sum in respect of a person 's employment", see Fatal Accidents Act, 1959 (7 & 8 Eliz, 2c.
65) section 2(2), "a superannuation allowance", see Midwives Act, 1936 (26 Geo.
5 & 1 Edw.
40) section 2(6), a "gratuity" and a return of contributions to a pension fund with or without interest thereon or any other addition thereto, see Transport Act, 1947, (10 & 11 Geo.
49) section 125(1), Gas Act, 1948 (11 & 12 Geo. 6c.
67) section 74(1).
(1) L.R. (1931) 58 I.A. 215, 219 20.
(2) I.L.R. , 436.
765 Now clause (1 ) of article VIII of the merger agreement guarantees payment of reasonable compensation to officials whose services are dispensed with by the new Government.
Clause 2 guarantees the continuance of pensions and leave salaries sanctioned by the Maharaja to officers who had retired before the date of the merger.
Considering that the object of article VIII is to guarantee payment of retirement benefits to retired public servants of the merged State, we are not inclined to give the word "pensions" a narrow interpretation.
In our opinion, the word "pensions" in clause 2 of article VIII includes the lump sum payable to the respondent as compensation under the Huzur order dated February 8, 1948 as modified by the Huzur order dated July 22, 1948.
In substance, the Huzur order directed that the respondent would get his full salary as his pension from the date of his premature retirement up to the completion of his superannuation age and allowed him to draw immediately the entire allowance for the period in one lump sum.
The allowance so payable to the respondent, a retiring government servant, in recognition of his past services is "pension" within the meaning of cl. 2 of article VIII of the merger agreement.
Article VIII of the merger agreement thus furnishes strong evidence of recognition by the Government of India of the liability to pay retirement compensation under the Huzur order dated February 8, 1948.
We have also noticed that the successor governments continued the old laws of the Baroda State until they were repealed or altered.
The successor governments resisted the respondent 's claim on the ground that the order of forfeiture passed by the Executive Council on April 22, 1949 was lawful.
There was no question of their disclaiming liability under the Huzur order of February 8, 1948 in case it was found that the order of the Executive Council dated April 22, 1949 was invalid.
In the 'circumstances, we hold that the successor governments recognized and took over the liability under the Huzur order dated February 8, 1958.
If so, it is not disputed that the liability has now devolved on the State of Gujarat.
It follows that the Courts below rightly decreed the suit.
This conclusion is sufficient to dispose of the appeal and we express no opinion whether the liability was also recognized by paragraph 4(i)(b) of the Administration of Baroda State Order, paragraph 5(iii)(a) of the Baroda State (Application of Laws) Order, 1949 or paragraph 7 (1 ) of the States ' Merger (Governors ' Provinces) Order, 1949.
In the result, the appeal is dismissed.
There will be no order as to costs in this Court.
R.K.P.S. Appeal dismissed.
[/INST]The respondents, who were Hindus filed a suit against the appellants who were Muslims, for a declaration that the Hindu residents of their villages had the right to take out religious and non religious processions.
with appropriate music along the roads and public highways in the: villages, including those by the side of two mosques in the villages.
The appellants contended that in 1931, in proceedings under section 107, Criminal Procedure Code, there was a compromise between the Hindus and the Muslims of the two villages, whereby it was agreed that Hindus would not play music between two land marks near the mosques, and that such a restriction was necessary to enable them to say their prayers in the. mosques.
The trial court held the respondents were bound by the compromise.
The first appellate court also held that the respondents were bound by the compromise, but that the respondents could take the processions between the landmarks with 'music in a low sound except drumbeating.
Both parties appealed to the High Court.
The High Court held, that the respondents were not bound by the compromise, that no restriction could be imposed on the right of the respondents ' community (Hindus) to take out processions with appropriate music, and that the restrictive order of the first appellate court that only low sound music could be played should be set aside.
In appeal to this Court.
HELD: (1) As the compromise was not arrived at in a suit fought.
in a respresentative capacity, it did not debar the parties from asserting, their legal rights in a civil court.
[567 D] Babu Ram Singh vs Subban Mochi, A.I.R. 1929 All. 519, explained.
(2) The respondents have the right to take out both religious and ' non religious processions with accompaniment of music on the roads and highways subject only to (a) an.y order of the local authorities regulating the traffic; (b) any directions of the Magistrate under any law fOE the time being in force; and (c) the rights of the public.
[568 G] Manzur Hasan vs Muhammad Zaman, (1924) 52 I.A.61, applied.
</s>
|
<s>[INST] Summarize the judgementivil Appeal Nos.
337 38 of 1982.
From the Judgments and order date 5.7.80 and 3.2.1981 of the Karnataka High Court in W.P. No. 543/1976 and 1217 of 1981 respectively .
R.N. Narasimamurthy.
Attorney General and P.R. Ramasesh for the Appellants.
G.L. Sanghi, A.K. Sen H.B. Datar.
K.R. Nagaraja.
N. Ganpathy, K.R. NambiaI, R.P. Ranga Swamy, R.B. Datar and Ms. c.
K. Sucharita for the Respondents .
R.S. Hegde for the impleded party.
DUTT, J.
These appeals by special leave preferred at the instance of the Secretary, Regional Transport Authority, Bangalore, and the State of Karnataka, are directed against the judgment of the Division Bench of the Karnataka High PG NO 1041 Court dismissing the appeal preferred by the appellants and affirming that of the learned Single Judge of the High Court whereby the Rule issued on the writ petition filed by the respondent No. 1 D.P. Sharma was made absolute.
The respondent No. 1, who is the owner of a public service vehicle, made an application on October 10, 1976 to the Regional Transport Authority for the grant of a special permit under sub section (6) of section 63 of the for the period from November 15, 1976 to November 22, 1976.
The Regional Transport Authority rejected the said application on the ground that the provisions of the Karnataka Contract Carriages (Acquisition) Act, 1976, hereinafter referred to as `the Act ', prohibit the grant of such permits.
The respondent No. 1 being aggrieved by the refusal by the Regional Transport Authority to grant a special permit filed a writ petition in the High Court.
A learned Single Judge of the High Court allowed the writ petition and directed the Regional Transport Authority to consider the application of the respondent No. I for the grant of special permit.
Against the judgment of the learned Single Judge, the appellants preferred a writ appeal to the Division Bench of the High Court.
The Bench took the view that the intention of the Legislature was that only a public service vehicle in relation to which a special permit had been issued when the Act came into force and which was not operating as a stage carriage should be acquired.
Accordingly, it was held that a public service vehicle in relation to which a special permit had not been issued when the Act came into force would not come within the definition of `contract carriage ' under section 3(g) of the Act and the prohibition contained in section 28 of the Act against the grant of contract carriage permit would not extend to the grant of special permit under sub section (6) of section 63 of the .
In that view of the matter, the Division Bench dismissed the appeal preferred by the appellants.
The only point that is involved in these appeals is whether after the coming into force of the Act, a special permit under section 63(6) of the can be granted under the Act.
The Act is to provide for the acquisition of contract carriages and for matters incidental, ancillary or subservient thereto.
The preamble provides, inter alia as follows: PG NO 1042 'Whereas contract carriages and certain other categories of public service vehicles are being operated in the State in a manner highly detrimental and prejudicial to public interest; And Whereas with a view lo prevent such misuse and also to provide better facilities for the transport of passengers by road and to give effect to the policy of the State towards securing that the ownership and control of the resources of the community are so distributed as best to subserve the common good and that the operation of the economic system does not result in the concentration of wealth and means of production to the common detriment; And Whereas for the aforesaid purposes it is considered necessary to provide for the acquisition of contract carriages and certain other categories of public service vehicles in the State and for matters incidential.
ancillary or subservient thereto; It is apparent from the preamble of the Act that the primary object of the Act is acquisition of contract carriages with a view to preventing misuse and also to provide better facilities for the transport of bassengers by road Besides the prearmble.
we may refer to the Statement of Objects and Reasons for the Act which will show the back ground for the enactment of the Act.
The Statement of objects and Reasons for the Act is as follows: "A large number of contract carriages were being operated in the StaLe to the detriment of public interest and were also functioning stealthily as stage carriages.
This had to be prevented.
Article 39(b) and (c) enjoins upon the .
State to see that the ownership and control of the material resources of the community are so distributed as best to subserve the common good and that the operation of the economic system does not result in the concentration of wealth to the common detriment.
In view of the aforesaid it was considered necessary to acquire the contract carriages run by private operators Accordingly the Karnataka Contract Carriages PG NO 1043 (Acquisition) Ordinance, 1976 was promulgated.
The Bill "seeks to replace the Ordinance.
" The constitutional validity of the Act was challenged before this Court and a Constitution Bench of Seven Judges in State of karnataka vs Shri Ranganatha Reddy, [1978] I SCR 641 upheld the validity of the Act.
In considering the question of validity of the Act, this Court referred to the Statement of Objects and Reasons for the Act and on the basis of various affidavits filed on behalf of the State, observed that the operators were misusing their permits granted to them as contract carriage permits, and that in many cases the vehicles here used as stage carriages picking up and dropping passengers in the way.
Accordingly.
the Legislature thought that to prevent such misuse and to provide for better facilities to transport passengers and to the general public, it was necessary to acquire the vehicles permits and all right title and interest of the contract carriage operators etc.
Keeping in view the objects and reasons for the enactment of the Act, we have to consider whether after the coming into force of the Act, it is permissible to grant a special permit under section 68(6) of the .
But before we do that we may refer to the Scheme of the Act.
We have already referred to the preamble to the Act providing for the acquisition of contract carriages.
The Act shall be deemed to have come into force on January 30, 1976 as provided in sub section (3) of section 1 of the Act.
Section 2 contains a declaration that the Act is for giving effect to the policy of the State towards securing the principles specified in clauses (b) and (c) of Article 39 of the Constitution of India and the acquisition therefor of the contract carriages and other property referred to in section 4 of the Act.
Section 3 is the definition section.
Clause (g) of section 3 is an extended definition of contract carriage ' as given in section 3(2) of the .
and we shall presently refer to and deal with the definition in detail.
Clause (h. of section 3 of the Act defines 'contract carriage operator '.
Under clause (m) of section 3 of the Act, 'permit ' means the permit granted under the , authorising the use of a vehicle as a contract carriage.
Section 4 is the vesting provision of contract carriages etc.
Section 6 provides for the determination of the amount for the vesting of the acquired property under section 4 of the Act.
Section 14 bars the issuance of a fresh permit or renewal of the existing permit for the running of any contract carriage.
Sub section (l) of section 20 provides inter alia that all contract carriage permits granted or renewed in respect of PG NO 1044 any vehicle, other than a vehicle acquired under the Act or belonging to the Karnataka State Road Transport Corporation or referred to in section 24 of the Act, shall stand cancelled.
Sub section (3) of Section 20 provides that "no officer or authority shall invite any application or entertain any such application of persons other than the Corporation for the grant of permit for the running of any contract carriage".
It has been already noticed that the Act provides for acquisition of contract carriages.
The words 'contract carriage ' have been defined in section 3(R) of the Act as follows: 3(g). 'contract carriage ' shall have the same meaning as in clause(3) of section 2 of the and includes (i) a public service vehicle in relation to which a special permit has been issued under sub section (6) of section 63 of the : (ii) a public service vehicle in relation to which a temporary permit has been issued under sub section (l) of section 62 or sub section (lC) of section 68F of the ; (iii) a public service vehicle without a contract carriage permit but which is specified as contract carriage in the concerned certificate of registration; (iv) any right in or over such vehicles or moveable property, but does not include, (i) a tourist vehicle in relation to which a permit has been issued under sub section (7) of section 63 of the ; (ii) a vehicle operating as a stage carriage in relation to which on the 30th day of January, 1976 a temporary contract carriage permit or a special permit issued under sub section ( l) of section 62 or sub section (6) of section 63 respectively of the , is in force; (iii) a motor cab;" PG NO 1045 Under section 3(g), the 'contract carriage ' shall, in the first place, have the same meaning as in section 2(3) of the , which provides as follows: "2(3). 'contract carriage ' means a motor vehicle which carries a passenger or passengers for hire or reward under a contract expressed or implied for the use of the vehicle as a whole at or for a fixed or agreed rate or sum (i) on a time basis whether or not with reference to any route or distance.
or (ii) from one point to another, and in either case without stopping to pick up, or set down along the line of route passengers not included in the contract, and includes a motor cab notwithstanding that the passengers may pay separate fares;" In the second place, section 3(g) gives an extended meaning to 'contract carriage '.
Under the extended meaning, 'contract carriage ' will include a public service vehicle in relation to which a special permit has been issued under section (6) of section 63 of the or in relation to which a temporary permit has been issued under sub section (l) of section 62 or sub section (IC) of section 68F of the .
It also includes a public service vehicle without a contract carriage permit but which is specified as contract carriage in the concerned certificate of registration.
We are not referring to clauses (iv) and (v) of the extended definition, as the same are not relevant for our purpose.
A 'public service vehicle ' has been defined in section 2(25) of the as meaning any motor vehicle used or adapted to be used for the carriage of passengers for hire or reward, and includes a motor cab, contract carriage, and stage carriage.
Thus, it is apparent from the definition of 'public service vehicle ' that it includes a contract carriage and a stage carriage as well.
Under clauses (i) and (ii) of section 3(g) of the Act if a special permit under section 63(6) or a temporary permit under section 62(1) or sub section (lC) of section 68F of the has been issued, it will come within the purview of the definition of contract carriage '.
In other words, if a 'contract carriage ' or a 'stage carriage ' within the meaning of the has been issued a special permit or a temporary permit, as referred to in PG NO 1046 clauses (i) and (ii) of section 3(g).
such 'contract carriage ' or 'stage carriage ' will be a contract carriage within the meaning of section 3(g) of the Act.
Now we may refer to the latter part of the definition of 'contract carriage ' under section 3(g) of the Act which excludes certain vehicles from the definition of contract carriage '.
The exclusion that has been provided in clause (ii) is important for our purpose.
It excludes a stage carriage in respect of which a temporary contract carriage permit under section 62(1) or a special permit under section 63(6) of the is in force on January 3(), 1976, that is, the date on which the Act is deemed to have come into force.
Under clauses (i) and (ii) of section 3(g) of the Act, which form a part of the extended definition of 'contract carriage ', a public service vehicle, that is to say, a contract carriage or a stage carriage in respect of which a special permit under section 63(6) or a temporary permit under section 62(1) or section 68F(lC) of the has been issued, will come within the meaning of 'contract carriage ' under the Act.
On the other hand, if a special permit under section 62(1) or under section 63(6) of the was in force on January 30, 1976 in respect of a stage carriage, such a stage carriage will not be a 'contract carriage ' within the meaning of section 3(g) of the Act.
The High Court seems to think that if any special permit had not been granted to a public service vehicle when the Act came into force, such a vehicle will not come within the meaning of the definition of 'contract carriage ' under section 3(g).
This view of the High Court is not correct.
In clauses (i) and (ii) of section 3(g), the expression 'has been issued ' occurs.
It is submitted by the learned Advocate General of Karnataka that in view of the expression 'has been issued ', clauses (i) and (ii) contemplate the issuance of a special permit or a temporary permit after the coming into force of the Act.
It does not include the issuance of a special permit or a temporary permit earlier than the date of the commencement of the Act.
The learned Advocate General has placed reliance on an English decision in re Athlumne, Ex parte Wilson, In that case, the words 'where a date has been proved under the principal Act ' came to be construed and it was observed "But this form of words is often used to refer, not to a past time which preceded the enactment, but to a time which is made past by anticipation a time which will have become a past time only when the event occurs on which the statute is to operate.
" In our opinion, whether the expression 'has been ' occurring in a provision of a statute denotes transaction prior to the enactment of the statute in question or a transaction PG NO 1047 after the coming into force of the statute will depend upon the intention of the Legislature to be gathered from the provision in which the said expression occurs or from the other provisions of the statute.
In the instant case, the words 'has been ' contemplate the issuance of a special permit or a temporary permit as referred to in clauses (i) and (ii) of section 3(g) of the Act after the enactment of the Act which is clear from the exclusion clause (ii) of section 3(g) which excludes a stage carriage from the definition of 'contract carriage ', if special permits issued under section 62(1) or section h.(6) of the were in force on January 30, 1976.
It is difficult to interpret clauses (i) and (ii) of section 3(g) as contemplating the issuance of a temporary permit or a special permit.
as referred to therein before the coming into force of the Act.
Merely because of the use of the words has been in clauses (i) and (ii) of section 3(g), such an interpretation is not possible to be made, particularly in view of the legislative intent apparent from the exclusion clause (ii), namely.
that the Legislature only.
excluded a stage carriage in respect of which a temporary contract carriage or a special permit issued under section 62(1) or 63(6) of the was in force on January 30, 1976.
It has, however, been urged by Mr. A K. Sen learned counsel appearing on behalf of the respondent No. 1.
that a stage carriage vehicle in respect of which a special permit has been granted, is excluded form the operation of the Act.
counsel submits that the Act only contemplates the acquisition of a contract carriage within the meaning of the Motor vehicles Act and not a stage carriage in respect of which a special permit was or has been granted.
In support of his contention, the learned counsel has placed strong reliance on the definition of the word permit under section 3(m) of the Act, as meaning the permit granted under the , authorising the use of a vehicle as a contract carriage.
It is submitted by him that the contract carriage under the .
It is urged by the learned Counsel that the word permit used in the different provisions of the act will have the same meaning of the word as defined in section 3(m), that is to say, the permit granted under the for the use of a vehicle as a contract carriage.
In section 3(h) 'contract carriage operator ' has been defined as follows: PG NO 1048 "3(h). 'contract carriage operator ' means an operator holding one or more contract carriage permit and includes any person in whose name a public service vehicle is registered and is specified as a contract carriage in the certificate or registration of such vehicle ;" According to the learned Counsel, the word 'permit ' in section 3(h) refers only to permit granted in respect of a contract carriage under the .
Section 4 is the vesting provision of contract carriages.
Clause (a) of sub section ( 1) of section 4 provides as follows: "4 Vesting of contract carriages, etc. (1) On and from such date as may be specified by the State Government in this behalf by notification in respect of any contract carriage operator, (a) every contract carriage owned or operated by such contract carriage operator along with the permit or the certificate of registration or both as the case may be shall vest in the State Government absolutely free from all encumbrances;" Counsel submits that the word Permit ' in clause (a) refers to a permit granted to a vehicle for the use of a contract carriage under the .
In other words, the sum and substance of the argument of Mr. Sen is that the word 'permit ' in section .(m) relates to the permit granted to a vehicle for the use as a contract carriage under the and the definition with this interpretation should be applied to the word Permit ' occurring in the different provisions of the Act including section 3(h) and should also be applied to the word occuring in section 14 of the Act.
Section 14 provides as follows: "14 Fresh permit or renewal of the existing permit barred.
Except otherwise provided in this Act (1) no person shall on or after the commencement of this Act apply for any permit or fresh permit or for renewal of an existing permit for the running of any contract carriage in the State; and (2) every application for the grant of a permit or fresh permit Or for the renewal of the existing permit and all PG NO 1049 appeals or revisions arising therefrom relating thereto made or preferred before the commencement of this Act and pending in any court or with any officer, authority or Tribunal constituted under the shall abate.
" It is submitted that only the grant or renewal of a permit in respect of a 'contract carriage ' within the meaning of the is prohibited under section 14 of the Act, and such prohibition does not relate to a stage carriage for the running of the same as; contract carriage.
We are unable to accept the contention.
If the interpretation as given by Mr. Sen of the definition of the word 'permit ', under section 3(m) of the Act is accepted, it will make the definition of the words 'contract carriage ' under section 3(g) of the Act meaningless and nugatory and also set at naught the object of the Act and the clear intention of the Legislature to acquire a stage carriage as well in respect of which a special permit or a temporary permit, as referred to in clauses (i) or (ii) of section 3(g), has been granted.
The words 'contract carriage ' occurring in section 3(m) must, in our opinion, be read in the light of the definition as contained in section 3(g) of the Act.
So read, it is manifest that section 14 read with section 20(3) of the Act clearly bars the making of any application for a permit or fresh permit or for renewal of an existing permit for the running of a vehicle, whether a contract carriage Or a stage carriage.
as a contract carriage.
It is not disputed before use that the Act does not contemplate the vesting of stage carriage simpliciter But section 14 read with section 20(3) of the Act clearly, prohibits the grant or renewal of any permit for the running of any contract carriage.
A stage carriage in respect of which d temporary contract carriage permit or a special permit under section 62(1) or section 63(6) respectively of the was in force on January 3t) 1 ')76, has been excluded from the definition obtaining a permit under the .
But whether a special permit was granted in respect of a stage carriage or not, no such PG NO 1050 permit can be granted in respect of a stage carriage for the running of it as a contract carriage.
In other words, section 14 read with section 20(3) of the Act confers a monopoly on the Karnataka State Road Transport Corporation to run vehicles as contract carriages.
The High Court is not, therefore, right in its view that a public service vehicle in relation to which a special permit had not been issued when the Act came into force, would not come within the definition of 'contract carriage ' in section 3(g) and the prohibition contained in section 20 of the Act against the grant of contract carriage permit cannot extend to grant of special permit under section 63(6) of the .
But before we conclude, we may observe that but for the object of the Act as stated above, it would have been very difficult for us to interpret the provisions of the Act in view of bad drafting of the same.
Be that as it may, for the reasons aforesaid, these appeals are allowed and the judgment of the High Court is set aside.
The writ petition filed by the respondent No. 1 in the High Court is dismissed.
There will, however, be no order as to costs.
N.V.K. Appeals allowed.
[/INST]The respondent assessee built up a factory for the manufacture of paper and paper boards, which started production on 7.5.1964.
The respondent claimed that the duty in respect of the paper boards manufactured in the factory during the period 7.5.1964 to June 1966 was payable at the concessional rates allowed by the Government of India notification dated 1st March, 1964.
The claim was however rejected by the Revenue on the ground that the factory had not come into existence on or before the 9th day of November, 1963 as stipulated in clause (a) of Proviso (3) of the said notification.
The respondent 's writ application before the High Court was allowed by the Single Judge and the appellant 's Letters Patent appeal was dismissed in limine.
The High Court has accepted the respondent 's contention that the date '9th of November, 1963 ' mentioned in the notification was arbitrary.
On behalf of the Revenue it was contended that the date (9.11.1963) was selected because an earlier notification bearing No. 110 had required applications to be made on or after 9.11.1963.
It was further contended that a statutory provision had necessarily to be arbitrary in the choice of date and it could not be challenged on that ground.
On behalf of the respondent it was contended that the said date did not have any significance whatsoever and did not bear any rational relationship to the object sought to be achieved by the notification.
PG NO 1051 PG NO 1052 Dismissing the appeal, it was HELD: 1.
A rule which makes a difference between past and present cannot be condemned as arbitrary and whimsical.
[1056D] 2.
In cases where choice of the date is not material for the object to be achieved.
the provisions are generally made prospective in operation.
[1056D] 3.
The Revenue has not been able to produce notification No. l 10.
Unless the nature and contents of notification No. 110 and its relevance with reference to the present notification are indicated, it is futile to try to defend of the choice of the date in clause (a) on its basis.
[1055A;1056E] 4.
In the present case, the benefit of concessional rate was bestowed upon the entire group of assesses referred therein and by clause (a) of Proviso (3) the group was divided into two classes without adopting any differentia having a rational relation to the object of the Notification.
[1057F] 5.
Clause (a) of the Proviso (3) of the Notification was ultra vires and the benefit allowed by the Notification would be available to the entire group including the respondent.
[1057G] Union of India vs M/s. P. Match Works [1975]2 SCR 573 Jagdish pandey vs The chancellor, University of Bihar.
[19681 I SCR 237 and U.P. M. T.
S.N.A. Samiti, Varanasi vs State of U.P.,[1987]2 SCR 453, distinguished.
Dr .Sushma Sharma vs State of Rajasthan, [1985] Supp.
SCC 45; and D.S. Nakara vs Union of lndia, [1983] I SCC 365 referred to.
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<s>[INST] Summarize the judgementAppeal No. 512 of 1964.
Appeal from the judgment and decree dated December 23, 1960 of the Allahabad High Court in Income tax Misc.
Case No. 475 of 1954.
A. V. Viswanatha Sastri, 4.
Ganapathy lyer, R. H. Dhebar and R.N. Sachthey, for the appellant.
section T. Desai, and J. P. Goyal, for the respondent.
The Judgment of the Court was delivered by Shah, J.
Under an agreement dated January 2, 1931, Lab Manmohan Das hereinafter called 'the assessee was appointed Treasurer of the Allahabad Bank Ltd. in respect of certain Branches, Sub Agencies and Pay Offices.
The assessee was assessed to income tax as representing his Hindu undivided family, and the income received by the assessee under the terms of the agreement with the Allahabad Bank, was treated as income of the Hindu undivided family.
In the previous year corresponding to the assessment year 1950 51 the assessee in performing his duties as a Treasurer suffered a net loss of Rs. 38,027.
For the assessment year 1951 52, the profit and loss account of the assesses showed Rs. 73,815 as receipts, against which were debited outgoings amounting to Rs. 39,370 which included Rs. 20,000 being the loss suffered by the assessee as Treasurer of the Patna Branch of the Allahabad Bank arising from misappropriation by an Assistant Cashier.
The Income tax Officer refused to allow the loss suffered in the previous year to be set off against the net profit of Rs. 34,445 and brought that amount of profit to tax as remuneration received by the assessee as Treasurer of the Allahabad Bank.
The order of the Income tax Officer was conflrmed in appeal by the Appellate Assistant Commissioner.
The 5 33 Income tax Appellate Tribunal held that the remuneration received by the assessee as Treasurer of the Allahabad Bank was income arising from pursuit of a profession or vocation within the meaning of section 10 of the Act and the loss suffered during the preceding year was liable to be set off against the assessee 's income from that source in the year under consideration.
At the instance of the Commissioner of Income tax, U.P., the following questions were referred to the High Court of Allahabad under section 66(1) of the Income tax Act, 1922: "(1) Whether on a true interpretation of the deed of agreement dated 2nd January, 1931, appointing the assessee as Treasurer of the Allahabad Bank Limited, income earned by the assessee from his activities as such Treasurer fell to be computed under Section 10 of the Act or Section 7 or Section 12 of the Income tax Act ? If the answer to this question is that such income is liable to be computed under Section 10 of the Act, (2)Whether the assessee could claim a set off of the loss suffered by him in the preceding year 1950 51 against his profits in the year under consideration, i.e., 1951 52 having failed to prefer an appeal against the refusal by the Income tax Officer making the assessment for the year 1950 51 to allow the assessee to carry forward the loss under Section 24(2) of the Act ?" The High Court held that the remuneration received by the from the Allahabad Bank was income liable to be taxed under section 10 of the Income tax Act, and that the assessee could claim to set off the loss computed in the assessment year 1950 51 against the profit in the subsequent year.
With certificate granted by the High Court, this appeal has been preferred by the Commissioner of Income tax.
The second question presents little difficulty.
In making his order of assessment for the year 1950 51 the Income tax Officer declared that the loss computed in that year could not be carried forward to the next year under section 24(2) of the Income tax Act, as it was not a business loss '.
The Income tax Officer has under section 24(3) to notify to the assessee the amount of loss as computed by him, if it is established in the course of assessment of the total income that the assessee has suffered loss of profits.
Section 24(2) confers a statutory right (subject to certain conditions which are not material) upon the assessee who sustains a loss of profits in any year in any business, profession or vocation to carry forward L3Sup.
Cl/66 4 5 34 the loss as is not set off under sub section (1) to the following year, and to set it off against his profits and gains, if any, from ',the same business, profession or vocation for that year.
Whether the loss of profits or gains in any year may be carried forward to the following year and set off against the profits and against the same business, profession or vocation under section 24(2) has to be determined by the Income tax Officer who deals with,the assessment of the subsequent year.
It is for the Income tax Officer dealing with the assessment in the subsequent year to determine whether the loss of the previous year may be set off against the profits of that year.
A decision recorded by the Income tax Officer who computes the loss in the previous year under section 24(3) that the loss cannot be set off against the income of the subsequent year is not binding on the assessee.
The answer to the first question depends upon the true interpretation of the terms of the agreement between the Allahabad Bank and the assessee ' If under the terms of the agreement it is found that the assessee was carrying on a business, profession or vocation, the assessee would be entitled to carry forward the loss suffered therein and set it off against the profits in the subsequent year of the same business, profession or vocation under section 24(2).
If the remuneration was received by the assessee as a servant of the Bank, and on that account has to be computed under section 7 of the Act, the right to set off the loss cannot be claimed under section 24(2).
The fact that the assessee held an office is however not decisive of the question whether remuneration earned by him was as a servant of the.
Allahabad Bank.
Receipt of remuneration for holding an office does not necessarily give rise to a relationship of master and servant between the holder of the office and the person who pays the remuneration.
The agreement is between the Allahabad Bank Ltd., and Lala Manmohan Das called in the agreement "Treasurer", and the expression Treasurer includes "his heirs and representatives".; By cl. 2 it is recited that the Treasurer is appointed for the Bank 's Branches and Sub Agencies and Pay Offices mentioned therein and such other offices in other parts of India for which he may be appointed, and that the Treasurer has agreed to provide security to the Bank for the discharge and performance of his duties and obligations to the Bank.
The agreement I then proceeds to set out the conditions of the agreement, the following of which are relevant: (1) "The Treasurer shall serve, the Bank as Treasurer for its Branches,, Sub Agencies and: Pay 535 Offices until, this agreement is determined as hereinafter provided." (2)"The remuneration of the.
Treasurer shall be a monthly allowance for each of the Branches, SubAgencies and Pay Offices the total of such monthly allowance to be Rs. 2,250 (Rupees two thousand two hundred and fifty) plus Rs. 350 (Rupees three hundred fifty) for travelling expenses.
" (3)"The duties, liabilities and responsibilities of the Treasurer to the Bank shall be such as either by custom or contract usually devolve on a Treasurer in the service of the Bank including the duties, liabilities and responsibilities hereinafter mentioned and the Treasurer shall faithfully discharge his duties and duly perform his obligations to the Bank." (4)"The Treasurer shall with the approval of the Bank appoint at adequate salaries to be paid by the Bank all the Indian staff as may be con sidered sufficient by the Bank for the business of the Cash Department of the Bank 's Branches, Sub Agencies and Pay Offices .
and shall dismiss any person or persons so appointed whom he shall be reasonably directed by the Bank to dismiss and shall with like approval appoint another or others in the place of person or persons so dismissed.
The Treasurer shall be deemed to have appointed the present staff of the Cash Department of the Branches, Sub Agencies and Pay Offices aforesaid.
Provided always that the Bank shall accept any proposal of the Treasurer for transfer, suspension or dismissal of any member of the Cash staff in the Bank." (5) "The Treasurer shall be responsible to the Bank for the work and conduct of every person to be appointed or employed on his staff and shall make good to the Bank any loss or damage sustained or incurred by the Bank from any embezzlement, theft, fraud, misappropriation, misconduct, mistake, omission, negligent act or default of any such person or persons." (6)"The Treasurer shall keep under his care and supervision or that of his staff the moneys, cash bullion, securities, cheques, notes, hundies, drafts, orders and 536 other documents or property which may from time to time be entrusted to him at the Branches, Sub Agencies and Pay Offices. . and shall whenever so required to do so transmit from one place to another place under such guard as may be provided by the Bank all such money, documents or properties and shall be responsible for the care and proper custody of the same while in transit.
Thai the Bank shall for the efficient working of its Cash Department provide proper iron safes and a strong room in each of the said Branches, Sub Agencies and Pay Offices and the Treasurer shall be responsible to the Bank for any loss occasioned to the Bank through the negligence, malfeasance or misfeasance of any of his servants or agents by the payment or delivery of any money, document or property aforesaid to a wrong person whether owing to forgery, mistake, fraud or otherwise.
" (7)"The Treasurer shall be responsible for the correctness and genuineness of all hundies, cheques, drafts, securities, vouchers, documents, writing and signature in an Indian language or character which the Treasurer or any of his staff may accept and certify as genuine and correct and shall make good to the Bank any loss or damage from any forged instrument or signature on a document as dealt with and shall also be liable for any loss occasioned to the Bank by receipt of any bad or base money coin or bullion or any forged or fraudulently altered currency note." (9)"The Treasurer shall not nor shall any substitute or any one of the staff of the Treasurer publish or divulgeany of the business affairs or transactions of the Bank or any of its constituents." (10) "The Treasurer 's employment. . may be determined at any time by either party giving to the other three calendar months written notice to that effect, and in case of the Treasurer 's death, this agreement as regards the Treasurer 's liabilities and obligations for the staff and other persons shall remain in force so as to bind his heirs, representatives and estate for any loss then accrued or accruing claim of the Bank hereunder but also for any future claim of the Bank in respect of any subsequent transaction or occurrence unless and 5 37 A until determined by his heirs or representatives giving like notice to the Bank.
" The agreement contains certain peculiar covenants : for instance, the expression "Treasure" includes the heirs and representatives and except where the content may justify a contrary implication, the rights, obligations and liabilities of the Treasurer would apparently be enforceable by or be enforced against the heirs and legal representatives of the assessee.
The Treasurer is entitled under the terms of cl.
(4) to transfer, suspend and dismiss any member of the staff in the cash department of the Bank and his recommendation in that behalf has to be accepted by the Bank.
The Treasurer has if reasonably directed by the Bank, but not otherwise, to dismiss any member of the Indian staff appointed by him, and to appoint another in the place of the person so dismissed.
The staff in the Cash department is referred in cls.
(5), (6) & (7) as the Treasurer 's staff.
Under cl.
(4) all the staff originally in the employment of the Bank at the date of the agreement and 3 the staff subsequently appointed were to be paid by the Bank, but the Treasurer was to stand responsible for any loss or damage which may be sustained not only for embezzlement, theft, fraud, misappropriation, misconduct, but even for mistake, omission, negligent act or de fault of any member of the staff.
The Treasurer has by the agreement undertaken to keep the moneys, cash, bullion, securities, cheques, notes, hundies, drafts, orders, and other documents or property under his care and supervision through his staff, and is liable to protect the property of the Bank in his custody, and has to make good any loss occasioned to the Bank by the negligence, malfeasance or misfeasance of any of "his servants or agents" even though not belonging to the Cash Department.
The Treasurer is responsible for the "correctness and genuineness" of all hundies, cheques, drafts, securities, vouchers, documents, writing and signature in an Indian language and he is responsible for any loss or damage from any forged instrument or signature on a document dealt with by his staff, and also for any loss arising from receipt, of any bad or base money coin or bullion or any forged or fraudulently altered currency note.
It may be noticed that the liability imposed under that covenant is for the acts of the staff appointed by him or deemed to have been appointed by him within the meaning of cl.
(4), and also for loss arising from the receipt of any bad or base money coin or bullion or any forged or fraudulently altered currency note by any person employed by the Bank.
The agreement also contemplates that the Treasurer may appoint any substitute to carry on the work of the Bank.
The Treasurer is under the agreement 538 responsible for the acts of the Indian staff at the Branches, SubAgencies and Pay.
Offices as far apart as Calcutta, Lahore, Lucknow, Patna, Amritsar, Benaras and Secunderabad.
On a fair reading of the terms of the agreement it appears that the Treasurer had to provide the staff for the cash section : he had power to suspend, transfer or dismiss any member of the staff or to appoint another person in his place: he had to perform the duties, liabilities and responsibilities which by custom or contract usually devolve upon a Treasurer and the duties specified in the agreement, and he was responsible for all acts of the staff so appointed which result in loss or damage to the Bank.
The Treasurer was also responsible for the protection of the property of the Bank and was also responsible for receipt of any bad or base money coin or bullion or any forged or fraudulently altered currency note.
Personal attendance by the Treasurer and supervision over the staff in the cash section in all the Branches and Pay Offices being in the very nature of things impossible, it was open to the Treasurer to appoint his own agents to supervise the work of the cash section.
An office of Treasurer was undoubtedly created by the agree ment.
It is recited in cl.
(1) that the Treasurer shall serve the Bank and in cl.
(3) that the duties, liabilities and responsibilities I of the Treasurer shall be such as by custom or contract usually devolve on a Treasurer in the service of the Bank.
For performing these duties there is a fixed remuneration which is paid to the Treasurer, beside the travelling expenses.
But the use of the expressions "serve.
, the Bank" and "in the service of the Bank" have to be read in the setting of the other covenants.
By them I selves they are not decisive of the ' intention of the parties to the agreement.
The office of the Treasurer can be determined only by notice on either side of a duration of three months, and even on the death of the assessee, the Treasurer 's obligations accrued or accruing during his life time, and future claims in respect of any transactions, even subsequent to his death, remain enforceable.
Express reference to liability of the Treasurer for future claims for subsequent transactions clearly indicates that the agreement does not come to an end by the death of the assessee : it is determined only by notice of three months ' duration.
Liability for transactions subsequent to the death of the person for the time being acting as Treasurer remaining enforceable, it is reasonable to infer that the right to receive remuneration would tenure to the person who would step into the office of the Treasurer.
539 The office of Treasurer is therefore to be held by the assessee, and After his death by, his heirs and legal representatives.
It is unnecessary to consider whether the agreement would be determined by any supervening disability of the Treasurer, which may render the contract impossible of performance.
But the Treasurer holds the office not as a servant of the Bank.
The Treasurer has unquestionably undertaken very onerous responsibilities.
There is however no covenant which authorises the Bank to control the Treasurer in the due performance of duties undertaken by him under the terms of the agreement.
Business of the Bank has undoubtedly to be carried on in the manner normally done by the Banks, and the duties, liabilities and responsibilities of the Treasurer are to be such as "either by custom or contract usually devolve on a Treasurer".
The Bank pays the Indian staff in the Cash Department, but the control is of the assessee.
He has control over the staff appointed by him or deemed to be appointed by him: he has therefore the power to initiate proposals for transfer, suspension or dismissal of any member of the cash staff.
This Court in Dharangadhara Chemical Works Ltd. vs State of Saurashtra(1) observed "The principles according to which the relationship as between employer and employee or master and servant has got to be determined are well settled.
The test which is uniformly applied in order to determine the relationship is the existence of a right of control in res pect of the manner in which the work is to be done.
A distinction is also drawn between a contract for service and a contract of service and that distinction is put in this, .,way.: "In the one case the master can order or require what is to be done while in the other case he cannot only order or require what is to be done but how itself it shall be done"." After referring to a large number of cases the Court observed P. 160 "The nature or extent of control which is requisite to establish the relationship of employer and employee must necessarily vary from business to business and is by its very nature incapable of precise definition.
it is not necessary for holding that a person is an employee, that the employer should be proved to have exercised control over his work, that the test of control (1)[1957] S.C.R., 152, 157.
54 0 was not One of universal application and that there were many contracts in which the master could not control the manner in which the work was done.
The correct method of approach, therefore, would be to consider whether having regard to the nature of the work there was due control and supervision by the employer or.
to use the words of Fletcher Moulton, L.J., at page 549 in Simons vs Health Laundry Company [(1910)1 K.B. 543] ".
it is impossible to lay down any rule of law distinguishing the one from the other.
It is a question of fact to be decided by all the circumstances of the case.
The greater the amount of direct control exercised over the person rendering the services by the person contracting for them the stronger the grounds for holding it to be a contract of service, and similarly the greater the degree of independence of such control the greater the probability that the services rendered are of the nature of professional services and that the contract is not one of service".
" Under the contract the Treasurer had to procure due performance of the duties of the Cash Department by employees under his supervision and that he was to be responsible for all acts done by them and to make good the loss which may result from any embezzlement, theft, fraud, misappropriation, mistake, misconduct, omission, negligent act or default of any such person.
In carrying out his duties under the contract apparently he was not to be controlled or supervised by the Bank.
The contract was therefore ,one for service and the Treasurer could not be called a servant of the Bank.
But Mr. Sastri on behalf of the Revenue contended relying upon Shivnandan Sharma vs The Punjab National Bank Ltd.(1) and Piyare Lal Adishawar Lal vs Commissioner of Income tax, Delhi(2), that under the contracts substantially similar to the contract in this case, Treasurers were held merely to be servants of the Banks, business whereof they attended.
It is true that in each of these cases this Court in interpreting a contract in which a Treasurer was appointed to supervise the Cash Department of a Bank, held that the Treasurer was a servant of the Bank, and not an independent contractor.
But unless the terms of the contracts (1) [1955]1 S.C.R. 1427.
(2) ; 541 and the circumstances in which they are made are identical, interpretation of one contract cannot be regarded as a guide for determining the intention of parties to another contract.
In Shivnandan Sharma 's case(1) the position of a Treasurer of a Bank fell to be determined somewhat indirectly.
Shivnandan a head cashier in one of the branches of the Punjab National Bank appointed by the Treasurer who was in charge of the Cash Department of the Bank under an agreement between the Bank and the Treasurer, was dismissed from the service by the Bank.
In a reference made to the Industrial Tribunal of certain industrial disputes including one for reinstatement of Shivnandan, it was held by this Court that under the terms of the agreement between the Treasurer and the Bank, the Treasurer was the servant of the Bank and not an independent contractor.
In coining to that conclusion the Court was substantially guided by the covenants which reposed the direction and control over Shivnandan and of the ministerial staff in charge of the Cash Department in the Bank.
The covenants of the agreement between the Treasurer and the Bank disclosed that the Treasurer had agreed to serve the Bank and to obey and observe all lawful orders and instructions of the Bank and to carry out such duties and to discharge such responsibilities as usually devolve upon a Treasurer in the employment of the Bank and in consideration thereof to receive remuneration mentioned in the Schedule.
The Treasurer and his nominees were bound as expressly stipulated to obey all the orders, rules, and regulations prescribed by the Bank with regard to the discharge of their duties by the cashiers as well as with regard to the amount of balance they were allowed to keep with them.
The Bank was also given power in case of gross negligence or misconduct or of any fraud, misappropriation or embezzlement by the Treasurer or any of the nominees in the discharge of their duties to dispense with the services of the Treasurer forthwith.
The Treasurer was not to engage any person as his assistant or, peon about whose character, conduct or reliability the manager of the Board of Directors of the Bank may have any objection.
Shivnandan was a nominee of the Treasurer, but from the terms of his employment it appeared that he was working directly under the control and supervision of the Punjab National Bank.
This Court held that the Treasurer 's relation to the Bank was that of a servant to the master, and the ministerial staff of the Cash Department appointed by him were also the employees in the Cash Department.
It is difficult to regard the agreement in Shivnandan Sharma 's case(1) as even substantially similar to (1) [1955]1 S.C.R. 1427.
542 the agreement in the present case between the Allahabad Bank and the Treasurer, so as to make the interpretation of the agreement a guide or a precedent in the interpretation of the agreement before us.
In Piyare Lal Adishwar Lal 's case(1), one Sheel Chandra was appointed Treasurer of the Central Bank for various branches on a monthly salary.
Under the agreement between Sheel Chandra and the Bank, Sheel Chandra had to engage and employ all subordinate staff.
He had the power to control, dismiss and change the staff at his pleasure, but he could not engage or transfer any member of the staff except with the approval of the Bank and he had to dismiss any such member if so required by the managing director of the Bank or Agent of the office.
The Treasurer was responsible for the acts and omissions of his representatives ' whom he was entitled to appoint at the various branches with the approval of the Bank, and he had agreed to indemnify the Bank against any loss arising from any neglect or omission on their part.
But the Treasurer and his staff were under the direct control of the Bank.
The agreement which was terminable by three calendar months ' notice in writing by either side, could in the event of any breach of any condition of the agreement by the Treasurer be terminated by the Bank forthwith.
Having regard to the nature of his work and the control and supervision of the Bank over the Treasurer, it was held that the Treasurer was a servant of the Bank and the emoluments received by the Treasurer were in the nature of salary and assessable under section 7 of the Income tax Act and not profits and gains of business under section 10.
Some of the covenants of the contract between the Central Bank and the Treasurer are similar to the agreement under consideration in this appeal, but in Piyarelal Adishwar Lars case(1) this Court founded its conclusion upon the existence of control and supervision of the Bank over the Treasurer and upon the power vested in the Bank to summarily dismiss the Treasurer in case of breach of any of the conditions of the agreement.
In the present case there is no covenant which either expressly or impliedly confers upon the Bank such control and supervision over the work done by the Treasurer, and the agreement is not liable to summary determination.
His duties, liabilities and responsibilities are to be such as either by custom or contract usually devolve upon the Treasurers and those which are specified in the agreement.
It is true that under cl.
(d) he has to transmit from one place to another place whenever so required, under such guard (1) [1960]1 S.C.R. 669.
543 as may be provided by the Bank, all such money, cash, bullion, securities, cheques, notes, hundies, drafts, orders and other documents, but that does not put the Treasurer under the general supervision of the Bank.
On a careful consideration of the covenants, we are of the view that the Treasurer was not a servant of the Allahabad Bank under the terms of the agreement dated January 2, 1931, and the remuneration received by him was not "salaries" within the meaning of section 7 of the Income tax Act.
But that is not sufficient to conclude the matter in favour of the assessee.
The benefit of section 24(2) of the Indian Income tax Act may be availed of by the assessee only if the loss sought to be set off was suffered under the head "Profits and gains .
in any business, profession or vocation".
It is difficult to regard the occupation of the Treasurer under the agreement as a profession, for a profession involves occupation requiring purely intellectual or manual skill, and the work of the Treasurer under the contract cannot be so regarded.
Occupation of a Treasurer is not one of the recognized professions, nor can it be said that it partakes of the character of a business or trade.
In performing his duties under the agreement the assessee exercised his skill and judgment in making proper appointments and made arrangements for supervising the work done by the 'Staff in the Cash Department of the Bank 's Branches.
The remuneration received by him was for due per formance of the duties and also for the guarantee against loss arising to the.
Bank out of the acts or omissions of the Cash and other staff of the Bank.
Taking into consideration the nature of the duties performed, and the obligations undertaken, together with the right to remuneration subject to compensation for loss arising to the Bank from his own acts and omissions or of the servants introduced by him into the business of the Bank, the assessee may be regarded as following a vocation.
The remuneration must therefore be computed under section IO of the Income tax Act and loss of profit suffered in that vocation in any year may be carried forward to the next year and be set off against the profit of the succeeding year.
The appeal therefore fails and is dismissed with costs.
Appeal dismissed.
[/INST]For the assessment years 1948 49, 1949 50 and 1950 51, the appellant was assessed on the basis of returns filed for the turnover of each relevant previous year.
For the assessment year 1951 52, the appellant, purporting to make an election under r. 39(1) of the U.P. Sales Tax Rules, filed returns of his turnover of the assessment year instead of the previous year.
The Judge (Revision) Sales Tax held that without the sanction of the Sales Tax Commissioner under r. 39(2), the appellant was not entitled to do so, and the High Court also, on a reference, held against the appellant.
In appeal to this Court, HELD : The answer of the High Court should have been in favour of the appellant.
[610 HI Under r. 39(1), the dealer makes a choice that he will be assessed in respect of the turnover not of the previous year, which is the normal position under section 7, but in respect of the turnover of the assessment year.
Rule 39(2), requiring the sanction of the Sales Tax Commissioner covers only the, case where such election has been made under r. 39(1), that is, where the election has been made by a dealer to be assessed in respect of the turnover of the assessment year, and the dealer wishes to exercise a fresh option.
Even assuming that, when a dealer submits a return in respect of the previous year under r. 40 be is treated to have elected within that rule, yet, there is no provision like r. 39 (2) which debars him from exercising the option under r. 39(1).
In the absence of an express provision like r. 39(2), general principles cannot debar an assessee from exercising a statutory right given to him.
[611 A E]
</s>
|
<s>[INST] Summarize the judgementminal Appeal No. 107 of 1961.
Appeal by special leave from the judgment and order dated June 16, 1961, of the Bombay High Court in Cr. A. No. 21 of 1961.
345 Rajni Patel, J. B. Dadachanji, O. C. Mathur and Ravinder Narain, for the appellant.
H.R. Khanna, R. H. Dhebar and R. N. Sachthey, for the respondents.
September 26.
The judgment of the Court was delivered by SUBBA RAO, J.
This appeal by special leave against the judgment of the High Court of judicature at Bombay raises the question of construction of s.3(b) of the Drugs Act, 1940, as amended by the Drugs (Amendment) Act, 1955, hereinafter called the Act.
This appeal has been argued on the basis of facts found by the High Court.
The appellant was carrying on business in the name of Deepak Trading Corporation at Bulakhidas Building, Vithaldas Road, Bombay.
On December 27, 1958, the Sub Inspector of Police, accompanied by the Drug Inspector, raided the said building and found large quantities of absorbent cotton wool, roller bandages, gauze and other things.
It was found that the appellant was not only storing these goods in large quantities but was actually manufacturing them in Bombay and passing them off as though they were manufactured by a firm of repute in Secunderabad.
The samples of the aforesaid articles and lint were sent to the Government Analyst, who reported that out of the samples sent to him only the lint was of standard quality and the other articles were not of standard quality.
The appellant was ' prosecuted before the Presidency Magistrate, 16th Court Bombay, for an offence under section 18 of the Act, inter alia, for manufacturing drugs which were not of standard quality.
The learned Presidency.
Magistrate acquitted the appellant on the ground that the prosecution had failed to prove that the articles were in the possession of the appellant.
The High Court on a resurvey of the evidence came to a different conclusion and found that the said articles 346 were not only found in the possession of the appellant but also were manufactured by him and that they were below the standard prescribed.
On the finding ', it convicted the.
appellant and sentenced him to undergo rigorous imprisonment for three months and to pay a fine of Rs. 500/ under each count.
Hence the appeal.
Though an attempt was made to argue that the said articles had not been proved to be below the prescribed standard, it was subsequently given up ' The only question that was argued is whether the said articles are drugs within the meaning of section 3(b) of the Act.
The said section reads ""drug" includes (i)all medicines for internal or external use of human beings or animals and all substances intended to be used for or in the treatment mitigation or prevention of disease in human beings or animals other than medicines and substances exclusively used or prepared for use in accordance with the Ayur vedic or Unani systems of medicine, and (ii)such substances (other than food) intended to affect the structure or any function of the human body or intended to be used for the destruction of vermin or insects which cause disease in human beings or animals as may be specified from time to time by the Central Government by notification in the Official Gazette.
The said definition of ""drug" is comprehensive enough to take in not only medicines but also substances intended to be used for or in the treatment of diseases of human beings or animals.
This artificial definition 347 introduces a distinction between medicines and substances which are not medicines strictly so called.
The expression "substances", therefore, must be something other than medicines but which are used for treatment.
The part of the definition which is material for the present case is " 'substances invented to be used for or in the treatment".
The appropriate meaning of the expression "substances" in the section is "things".
It cannot be disputed, and indeed it is not disputed, that absorbent cotton wool, roller bandages and gauze are "substances" within the meaning of the said expression.
If so, the next question is whether they are used for or in "treatment".
The said articles are sterilized or otherwise treated to make them disinfectant and then used for surgical dressing; they are essential materials for treatment in surgical cases.
Besides being aseptic these articles have to possess those qualities which are utilized in the treatment of diseases.
Thus for instance, in the case of gauze one of the articles concerned in this appeal it has to conform to a standard of absorbency in order that it might serve its purpose: otherwise the fluid which oozes is left to accumulate at the site of the wound or sore.
The Legislature designedly extended the definition of " 'drug" so as to take in substances which are necessary aids for treating surgical or other cases.
The main object of the Act is to prevent substandard in drugs, presumably for maintaining high standards of medical treatment.
That would certainly be defeated if the necessary concomitants of medical or surgical treatment were allowed to be diluted: the very same evil which the Act intends to eradicate would continue to subsist.
Learned counsel submitted that surgical instruments would not fall within the definition and that gauze and lint would fall within the same class.
It is not necessary for the purpose of this appeal to definite exhaustively "the 'substances" falling within the definition of " 'drugs"; and we consider that whether or not surgical instruments are drugs", the articles concerned in this case are.
348 Learned counsel for the appellant sought to rely upon a report of a high powered committee consisting of expert doctors, who expressed the opinion in the report that as the surgical dressings did not come under the purview of the Drugs Act, no control on their quality was being exercised.
Obviously, the opinion of the medical experts would not help us in construing a statutory provision.
We, therefore, hold, agreeing with the High.
Court, that the said articles are substances used for or in the "treatment" within the meaning of section 3(b) of the Act.
An impassioned appeal was made for reducing the sentences imposed upon the appellant.
When a similar argument was advanced in the High Court, it pointed out that this was a gross case where large quantities of spurious drugs had been manufactured by the appellant and passed off as goods manufactured by a firm of repute.
The appellant was guilty of an anti social act of a very serious nature.
In our view, the punishment of rigorous imprisonment for three months was more lenient than severe.
There is no case for interference with the sentences.
The appeal fails and is dismissed.
Appeal dismissed.
[/INST]The appellant was found in possession of large quantities of absorbent cotton wool, roller bandages and gauze which he had manufactured.
On analysis these were found to be sub standard and the appellant was prosecuted under section 18 of the Drugs Act, 1940, for manufacturing sub standard drugs.
He was convicted and sentenced to undergo rigorous imprisonment for three months and to pay a fine of Rs. 500/.
The appellant contended that these articles were not drugs as defined in section 3(b) of the Act and that the sentence imposed was too severe.
Held, that absorbent cotton wool, roller bandages and gauze were "drugs" within the meaning of section 3(b) and the appellant was rightly convicted.
In the definition "drugs" "included substances intended to be used for or in treatment of diseases".
"Substances" was something other than "medicines" and meant "things".
The said articles were sterilized or otherwise treated to make them disinfectant; they were used for surgical dressings and were essential materials for treatment in surgical cases.
The object of the Act of maintaining high standards of medical treatment would be defeated if the necessary concomitants of medical or surgical treatment were allowed to be diluted.
Held, further,that the sentence erred on the side of leniency rather than severity and could not be reduced.
It was a case where large quantities of spurious and sub standard drugs had been manufactured by the appellant.
He was guilty of an antisocial act of a very serious nature.
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<s>[INST] Summarize the judgementtition No. 215 of 1989.
(Under Article 32 of the Constitution of India.) M.S. Gujral, Ms. Kirti Misra and B .B. Sawhney for the Petitioners.
G.B. Pari, O.C. Mathur, Ms. Meera and section Sukumaran for the Respondents.
The Judgment of the Court was delivered by K. RAMASWAMY, J.
This writ petition under article 32 filed on behalf of about 450 erstwhile employees of M/s. Burmah Shell retired between May 1, 1979 and December 1984, is for a mandamus or direction to the respondents to restore full pension (which had been commuted) to the petitioner Nos. 2 to 5 and others similarly situated upon the expiry of 12 1/2 years from date of retirement in case of those retired prior to April 1985 and after 11 1/3 years to those retired prior to April 1, 1985 from their respective dates of retirement.
They claim that though in their previous Writ Petition No. 590/87 disposed of by a Division Bench of this Court on May 11, 1988 of which one of us (Ranganath Misra, J.) was a member, a hike in the pension effective from May 1, 1988 was granted.
Consideration of the present relief had been left over for a later period.
Admittedly, the petitioners in Writ Petition No. 590/87 sought two reliefs, namely, (i) restora tion of the commuted portion of the pension, and (ii) en hancement of pension or par with the pensioners of the Hindustan Petroleum Corporation Limited, for short 'HPCL '.
During the course of hearing, claim for the 964 first relief was given up and submission was confined to the second relief.
This Court accepted the contentions of the petitioners and ordered a seizeable hike in the pension.
The relief in this writ petition squarely covers relief No. 1 of Writ Petition No. 590/87.
But the ground on which the peti tioners have again come before the Court within a short spell is that their hope of the respondent 's sister concern, namely, HPCL, restoring commuted portion of pension to its pensioners has been smashed as it has deferred its decision on the issue till 1992.
Their learned counsel contends that in Common Cause & Ors.
vs Union of India, ; this Court upheld the 15 years formula and directed that the commuted portion of the pension should be restored to all the civil servants as well as the armed forces personnel of the Central Government effective from April 1, 1985.
It is maintained that as principle the same would be applicable to the petitioners as well.
The respondents, it is claimed, have to bear an additional liability of only a sum of Rs.1,02,41,635 out of its huge profits without in any manner affecting its functioning.
When the employees of the Central Govt.
and other Public Sector Undertakings are receiving the same benefits, the denial thereof to the petitioners is arbitrary, unjust and unfair and offends article 14 of the Constitution.
There is no scheme in vouge in other Public Sector Undertakings like commuted pension scheme except in HPCI.
Though HPCL has postponed action in this regard till 1992, the petitioners are not precluded to approach this Court for redressal and the previous decision does not operate as res judicata.
This Court having accorded in equity benefits of pension, which is a legal right of the petitioner, the relief also may be granted to the petition ers.
Shri Pai, learned counsel for the respondents, has resisted all these contentions.
The short question is wheth er it is a fit case for interference and issue of a direc tion to the respondents to give the relief as prayed for.
Admittedly, the petitioners claimed this relief in Writ Petition No. 590/87.
This Court after appropriate considera tion held that a sizeable hike in pension would meet the ends of justice.
Admittedly, Burmah Shell has a unique scheme known as "Burmah Shell India Pension Fund" with its own rules.
This Court held that the retired personnel would be entitled to a hike in pension at par with pensioners of HPCL.
Admittedly, HPCL has not accorded to its pensioners the relief of restoration of the commuted portion of pension after the expiry of 15 years.
The order passed by this Court is as recent as May 11, 1988.
After such a short time lag and in the absence of any substantial change in the posi tion, in our considered view, it is not desirable to enter tain the claim for restoration of commuted pen 965 sion.
Admittedly, the petitioners are governed by a special scheme, which is not at par with Government employees or the other Public Sector Undertakings.
In all fairness Shri Pai also has stated that as and when HPCL revises its scheme the petitioners would be entitled to the same benefits.
Grant or ' the relief at this stage would create disparity between the personnel who receive pension from HPCL and the re spondents.
We find sufficient justification in the conten tion of Shri Pai.
So we do not feel justified that it would be appropriate to interfere and grant the relief as prayed for.
The writ petition is accordingly dismissed, but without costs.
G.N. Petition dismissed.
[/INST]The Deputy Commissioner of Amraoti, evolved a scheme for the distribution of standard cloth.
The assessees agreed to finance the scheme without charging any interest and were appointed financiers and distributors.
The orders for the cloth were placed by the Government with the mills and the cloth was delivered to the assessees upon their paying the value of the cloth together with 6 1/4% of the ex mill price.
The Deputy Commissioner paid 4 1/2% of the ex mill price to the asses sees for contingent expenses of working the scheme.
The assessees distributed the cloth at prices fixed by the Deputy Commissioner through the Tehsildars and the Deputy Commissioner was responsible to the assessees for the sale proceeds receivable from the Tehsildars.
Out of the sale proceeds the Deputy Commissioner paid to the assessees whatever they had advanced on the cloth.
The profits from the scheme were agreed to be utilised for such charitable purposes as might be decided by the Deputy Commissioner.
The assessees contended that the income was not their income and that it was exempt from taxation under section 4(3) (i a) of the Income tax Act.
Held, that the profits were income which accrued to the assessees.
The assessees worked the scheme and such working produced the profits.
The fact of the control of the Deputy Commissioner could not prevent the working of the scheme by the assessees from being a business carried on by them.
The provisions in the agreement that the Deputy Commissioner guaranteed the payment by the Tehsildars of the price due from them, and that the profits would be devoted to charity decided by the Deputy Commissioner and the claim for exemption under section 4(3) (i a) all indicated that the assessees were the owners of the business.
Held further, that the profits were not exempt from taxation under section 4(3) (i a), as the business was not carried on behalf of any religious or charitable institution.
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<s>[INST] Summarize the judgementAppeals Nos. 209 and 210 of 1953.
Appeals by special leave against the Judgment and Orders dated 4th April, 1953, of the High Court of Judicature of Mysore at Bangalore (Medapa C. J. and Vasudevamurthy J.) in Civil Petitions Nos, 20 and 21 of 1953, 538 M.Ramaswamy, Senior Advorate, (B. Neelakanta, with him) for the appellant.
M. C. Setalvad, Attorney General for India, (Porus A. Mehta, with him) for the respondent.
1953 .
December 16.
The Judgment of the Court was delivered by PATANJALI SASTRI C. J.
These two connected appeals arise out of applications made to the High Court of Judicature at Bangalore under article 226 of the Constitution challenging the jurisdiction of the Income tax Officer, Special Survey Circle, Bangalore, to assess the appellant to income tax and super tax on his income accruing prior to April 1, 1950, in the State of Mysore and praying for the issue of appropriate writs in that behalf.
The applications were dismissed by the court and leave to appeal having been refused, the appellant has brought these appeals by special leave of this court.
It is a matter of admission that the officer making the assessments was an officer Appointed under the Indian Income tax Act,, 1922, and that in making such assessments he was applying the income tax law in force in the State of Mysore down to the end of the year of account 1948 49.
The officer was exercising jurisdiction in the State by virtue of the proviso to section 13 of the Indian Finance Act, 1950, which reads as follows: Repeals and Savings. (1) If immediately before the 1st day of April, 1950, there is in force in any Part B State other than Jammu and Kashmir or in Manipur, Tripura or Vindhya Pradesh or in the merged territory of Cooch Behar any law relating to income tax or super tax or tax on profits of business, that law shall cease to have effect except for the purposes of.
the levy, assessment and collection of income tax and super tax in respect of any period not included in the previous year for the purposes of assessment under the Indian Income tax Act, 1922, for the year ending on the 31st day of March, 1951, or for any subsequent year or, as the case may be, the levy, assessment and 539 collection of the tax on profits of business for any chargeable accounting period ending on or before the 31st day of March, 1949: Provided that any reference in any such law to an officer, authority, tribunal or court shall be construed as a reference to the corresponding officer, authority, tribunal or court appointed or constituted under the said Act, and if any question arises as to who such corresponding officer, authority, tribunal or court is, the decision of the Central Government thereon shall be final.
It is contended that the proviso is ultra vires and void as the Union Parliament had no power to make a law authorising any officer or authority or Tribunal or Court appointed or constituted under the Indian Inconm tax Act, 1922, to levy, assess and collect incometax and super tax payable under the Mysore law prior to the commencement of the Constitution of India.
The contention is based on two grounds: namely, firstly, on general constitutional principles the Union Parliament had no power to make a law, having retrospective operation with reference to the pre Constitution period; and secondly, the Union Parliament is prohibited by article 277 of the Constitution by necessary implication from making a law grafting on the Mysore income tax law the machinery for assessment and collection provided under the Indian Income tax Act, 1922, for purposes of assessment thereunder.
So far as the first ground is concerned, the case is governed by the judgment just delivered in the Rajasthan case [Union of India vs Madan Gopal Kabra (1) ].
It remains only to deal with the second ground based on article 277.
That article reads thus : "Any taxes, duties,.cesses or fees which, immediately before the commencement of this Constitution, were being lawfully levied by the Government of any State or by any municipality or other local authority or body for the purposes of the State, municipality, district or other local area may, notwithstanding that (1) Infra p. 541.
71 540 those taxes, duties, cesses, or fees are mentioned in the Union List, continue to be levied and to be applied to the same purposes until provision to the contrary is made by Parliament by law.
" It was urged that, inasmuch as the article authorises, among others, the income tax and super tax, which was being lawfully levied by the Government of Mysore prior to the commencement of the Constitution to be levied and to be applied to the same purposes even after the commencement of the Constitution until provision to the contrary is made by Parliament by law, and no such law was made by Parliament till April 1, 1950, when the Indian Finance Act, 1950, was enacted, it followed by necessary implication, the Mysore law of income tax must be applied for the levy, assessment and collection of such taxes and, as the legislative power conferred on Parliament by article 245 is subject to the provisions of the Constitution including article 277, Parliament had no power to legislate, grafting officers and authorities.
appointed under the Indian Income tax Act, on the Mysore State, for the levy, assessment and collection of the tax under the State law.
We see no force in this argu ment.
While article 277 undoubtedly authorises the continued levy of taxes lawfully levied by the Government of the State before the commencement of the Constitution and their application to the same purposes as before, even after the Constitution came into force, there is nothing in the article to warrant any implication that such taxes should continue to be levied, assessed and collected by the same State authorities as before the Constitution.
As the High Court rightly pointed out, it would obviously have been inconvenient and unnecessary to have officers appointed under the Mysore Income tax Act continuing to function only in respect of the earlier assessment years side by side with officers appointed under the Indian Income tax Act also functioning in the State for assessments subsequent to April 1, 1950.
Both as a measure.
of economy and with a view to smooth and efficient management, it 541 was obviously necessary and desirable that the changeover from the Mysore income tax law to the Indian Income tax Act should be in the way provided by section 13 of the Indian Finance Act, 1950.
We find nothing in article 277 of the Constitution to preclude Parliament making a law providing for the levy and collection of income tax and super tax under the Mysore Act through authorities appointed under the Indian Income tax Act.
Accordingly, we hold that the Income tax Officer, Special Survey Circle, Bangalore, had jurisdiction to assess the appellant to income tax and super tax in respect of the income of the period prior to the commencement of the Constitution.
The appeals fail and are dismissed with costs.
Appeals dismissed.
[/INST]The assessee challenged the jurisdiction of the Income tax Officer, Special Survey Circle, Bangalore, to assess income tax and super tax on his income accruing prior to April 1, 1950, in the State of Mysore, on the ground that the proviso to section 13 of the Indian Finance Act, 1950, by virtue of which he was exercising his power was ultra vires and void as the Parliament had no pow or to make a law authorising any officer appointed under the Indian Income tax Act to levy tax under the Mysore law prior to the Constitution.
It was contended (i) that on general constitutional principles the Union Parliament had no power to make a law having retrospective effect with reference to pre Constitution period, (ii) that the Parliament was also prohibited by article 277 from making a law authorising such officers as in the present case to mot in the State of Mysore: Held, (repelling the contentions) (i) that the Parliament had such power vide the judgment delivered in Case No. 296 of 1951, (ii) that while article 277 authorises the continued levy of taxes lawfully levied by the Government of the State before the commencement of the Constitution and their application to the same purposes as before, even after the Constitution came into force, there is nothing in the article to warrant any implication that such taxes should continue to be levied, assessed and collected by the same State authorities as before the Constitution and there is nothing in article 277 to preclude Parliament making a law providing for the levy and collection of income tax and super tax under the Mysore Act 'through authorities appointed under the Indian Income tax Act.
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<s>[INST] Summarize the judgementAppeals Nos. 601 and 602 of 1963.
Appeals from the judgment and decree dated December 9, 1958, of the Allahabad High Court in First Appeals Nos.
373 of 1945 and 92 of 1946.
582 Civil Appeal No. 603 of 1963.
Appeal by special leave from the judgment and decree dated December 9, 1958 of the Allahabad High Court in First Appeal No. 374 of 1945.
N. D. Karkhanis and R. N. Sachthey, for the appellant (in all the three appeals).
G. section Pathak, Rameswar Nath, section N. Andley and P. I. Vohra, for the respondents (in all the three appeals).
Wanchoo, J. These three appeals raise common questions and will be dealt with together.
They arise out of two suits filed against the Government of India claiming damages for loss of goods which were destroyed by fire on the railway platform at Morar Road Railway Station.
One of the suits was filed by Birla Cotton Factory Limited, now represented by the West Punjab Factories Limited (hereinafter referred to as the Factory).
It related to six consignments of cotton bales booked from six stations on various dates in February and March 1943 by the Factory to Morar Road Railway Station.
In five of the cases, the consignment was con Signed to J. C. Mills while in one it was consigned to self.
The consignments arrived at Morar Road Railway Station or.
various dates in March Delivery was given of a part of one consignment on March 7, 1943 while the remaining goods were still in the custody and possession of the railway.
On March 8, 1943, a fire broke out at the Morar Road Railway Station and these goods were involved in the fire and severe damage was caused to them.
It is not necessary to refer to the details of the damage for that matter is not in dispute between the parties.
The case of the Factory was that the damage and loss was caused while the goods were in the custody and control of the railway administration and it was due to misconduct, negligence and carelessness on the part of the railway administration.
Consequently, the suit was filed for Rs. 77,000 and odd along with interest upto the date of the suit and interest pendente lite and future interest.
In the other suit there was one consignment of 45 bales of cotton yarn.
This consignment was booked from Belangunj to Morar Road Railway Station on February 22, 1943 and the railway receipt relating to this consignment was endorsed in favour of Ishwara Nand Sarswat who filed the suit.
This consignment arrived at 583 Morar Road Railway Station on February 23, 1943.
Ishwara Nand Sarswat went to take delivery of this consignment on March 10, 1943, his case being that be had received the railway receipt on March 9, 1943.
He then came to know that the consignment was involved in a fire which had taken place on March 8, 1943 and severe damage had been done to the consignment.
Ishwara Nand Sarswat therefore filed the suit on the ground that damage and loss was due entirely to the gross negligence of the railway administration.
He claimed Rs. 72,000,/ and odd as damages and also claimed interest upto the date of the suit and pendente lite and future interest.
The suits were resisted by the Government of India.
In the first suit by the Factory, it was pleaded that the Factory could not sue as , the goods in five of the receipts had been consigned to the J. C. Mills; secondly, it was pleaded that delivery had been given of atleast five of the consignments to the J.C. Mills before the fire broke out and the railway administration was not therefore responsible for the damage done by the fire, for it was the fault of the J. C. Mills not to have removed the goods immediately after the delivery; thirdly, it was pleaded that damages should have been granted at the rate of Rs. 38/ per bale, which was the price contracted for between the buyer and the seller and not at the market rate on the date of the damage as was done by the courts below , fourthly, it was pleaded that no interest should have been allowed for the period before the suit; and lastly, it was pleaded that the conduct of the railway administration was not negligent and there fore the railway was not bound to make good the loss.
On these pleas, five main issues relating to each of them were framed by the trial court.
The trial court found that the Factory could maintain the suit and decided accordingly.
It also found that in the case of five consignments by the Factory, delivery had been given before the fire broke Out and therefore the railway was not responsible; in the case of the sixth consignment it held that there was no proof that delivery bad been given before the fire broke out and that the railway would be responsible if negligence was proved.
On the quantum of damages, the trial court held that the damages had to be calculated at the market price on the date of the fire and not at the contract price between the buyer and seller.
On the question of interest, the trial court held that interest before the date of the suit should be allowed on equitable , rounds.
Finally, on the question of negligence, the trial court held that there was negligence by the railway and it was therefore liable for loss and damage caused by the fire which broke out on L7Sup./65 9 584 March 8, 1943.
As however, the trial court had held that delivery had been given in the case of five consignments, though the goods had not been removed, the railway was not responsible for the loss.
It therefore decreed the suit in part with respect to the sixth consignment about which it had found that there had been no delivery.
The same issues were raised in the suit by Ishwara Nand Saraswat.
But there was one additional issue in that suit based on the contention of the Government of India that it had given notice to Ishwara Nand that the consignment had arrived on February 23, 1943, Ishwara Nand however did not come to remove the goods till March 8, 1943 when the fire broke out; therefore it was urged that the liability of the railway administration as carrier had ceased after the lapse of reasonable time after arrival of the consignment at the railway station.
This reasonable time could not be beyond three days in any case and therefore the railway administration was not bound to make good the loss even if it had been occasioned on account of the negligence of the administration.
As Ishwara Nand should have removed the consignment within three days of February 23, it was his failure to do so which resulted in the damage and loss.
The issues which were common to this suit and the suit by the Factory were decided on the same lines by the trial court as in the suit by the Factory.
On the further issue which arose in this suit as to the delay in the removal of goods after notice to Ishwara Nand, the trial court held after reference to certain rules made by the railway administration that even if the railway administration 's responsibility as carrier had ceased after the lapse of reasonable time, it was still liable as a bailee either as a warehouseman or as a gratuitous bailee.
It therefore gave a decree for Rs. 76,000 and odd to Ishwara Nand.
Then followed three appeals to the High Court two in the suit by the Factory and one in the suit of Ishwara Nand.
The appeal in the suit by Ishwara Nand was by the Government of India; one appeal in the suit by the Factory was by the factory with respect to that part of the claim which had been dismissed, and the case of the Factory was that in fact no delivery had been made to it and it was entitled to the entire sum claimed as damages.
The other appeal was by the Government of India with respect to the amount decreed by the trial court and it raised all the contentions which had been raised before the trial court.
The High Court dealt with the three appeals together.
In all appeals the High Court confirmed the finding of the trial court that there had been negligence on the part of the railway which 585 resulted in damage to the goods.
On the question whether the suit could be maintained by the plaintiffs, the High Court affirmed the finding of the trial court that both the suits were maintainable.
The High Court also affirmed the finding of the trial court with respect to the rate at which damages should be calculated and on the question of interest before the date of the suit.
Further in the suit by Ishwara Nand, the High Court held that even if the railway administration ceased to be responsible as a carrier after a reasonable time had elapsed after the arrival of the goods at Morar Road Railway Station, it was still responsible as a warehouseman.
The appeal therefore of the Government of India in Ishwara Nand 's suit was dismissed.
On the question of delivery in the Factory '& suit the High Court disagreed with the finding of the trial court that there had been delivery of five consignments.
It held that there was no effective delivery even of these five consignments.
In consequence, the appeal of the Factory was allowed while that of the Government of India was dismissed.
Then followed applications to the High Court for leave to appeal to this Court in the Factory 's suit. 'Me High Court granted the certificate as the judgment was one of variance and the amount involved was over rupees twenty thousand.
However, in the suit of Ishwara Nand, the High Court refused to grant a certificate as the judgment was one of affirmance and no substantial question of law arose.
Thereupon the Government of India applied to this Court for special leave in Ishwara Nand 's suit and that was granted.
The three appeals have been consolidated in this Court for as will be seen from what we have said above, the principal points in volved in them are common.
Learned counsel for the appellant has not and could not challenge the concurrent finding of the trial court and of the High Court that the fire which caused the damage was due to the negligence of the railway administration.
But the learned counsel has pressed the other four points which were raised in the courts below.
He contends (i) that the suits as filed were not maintainable, (ii) that the High Court was in error in reversing the finding of the trial court that the delivery had been given with respect to five of the consignments in the Factory 's suit, (iii) that damages should have been awarded at Rs. 38/ per bale which was the contract price between the buyer and seller and not at the market price on the date on which the damage took place, and (iv) that interest could not be awarded for the period before the suit on the amount of damages decreed.
586 Re.
The contention of the appellant with respect to five of the consignments in the suit of the Factory was that as the consignee of the five railway receipts was the J.C. Mills, the consignor (namely, the Factory) could not bring the suit with respect thereto and only the J.C. Mills could maintain the suit.
Ordinarily, it is the consignor who can sue if there is damage to the consignment, for the contract of carriage is between the consignor and the railway administration.
Where the property in the goods carried has passed from the consignor to some one else, that other person may be able to sue.
Whether in such a case the consignor can also sue does not arise on the facts in the present case and as to that we say nothing.
The argument on behalf of the appellant is that the railway receipt is a document of title to goods [see section 2(4)] of the Indian Sale of Goods Act, No. 3 of 1930), and as such it is the consignee who has title to the goods where the consignor and consignee are different.
It is true that a railway receipt is a document of title to goods covered by it, but from that alone it does not follow, where the consignor and consignee are different, that the consignee is necessarily the owner of goods and the consignor in such circumstances can never be the owner of the goods.
The mere fact that the consignee is different from the consignor does not necessarily pass title to the goods from the consignor to the consignee, and the question whether title to goods has passed to the consignee will have to be decided on other evidence.
It is quite possible for the consignor to retain title in the goods, himself while the consignment is booked in the name of another person.
Take a simple case where a consignment is booked by the owner and the consignee is the owner 's servant, the intention being that the servant will take delivery at the place of destination.
In such a case the title to the goods would not pass from the owner to the consignee and would still remain.
with the owner, the consignee being merely a servant or agent of the owner or consignor for purposes of taking delivery at the place of destination.
It cannot therefore be accepted simply because a consignee in a railway receipt is different from a consignor that the consignee must be held to be the owner of the goods and he alone can sue and not the consignor.
As we have said already, ordinarily, the consignor is the person who has contracted with the railway for the carriage of goods and he can sue; and it is only where title to the goods has passed that the consignee may be able to sue.
Whether title to goods has passed from the consignor to the consignee will depend upon the facts of each case and so we have to look at the evidence produced in this case to decide whether in the case of five con 587 signments booked to the J.C. Mills, the title to the goods had passed to the Mills before the fire broke out on March 8, 1943.
We may add that both the courts have found that title to the goods had not passed to the J. C. Mills by that date and that it was still in the consignor and therefore the Factory was entitled to sue.
We may in this connection refer briefly to the evidence on this point.
The contract between the Factory and the J. C. Mills was that delivery would be made by the seller at the godowns of the J. C. Mills.
The contract also provided that the goods would be dispatched by railway on the seller 's risk up to the point named above (namely, the godowns of the J. C. Mills).
Therefore the property in the goods would only pass to the J. C. Mills when delivery was made at the godown and till then the consignor would be the owner of the goods and the goods would be at its risk.
Ordinarily, the consignments would have been booked in the name of "self" but it seems that there was some legal difficulty in booking the consignments in the name of self and therefore the J. C. Mills agreed that the consignments might be booked in the Mills ' name as consignee; but it was made clear by the J. C. Mills that the contract would stand unaffected by this method of consignment and all risk, responsibility and liability regarding these cotton consignments would be of the Factory till they were delivered to the J. C. Mills in its godowns as already agreed upon under the contract and all losses arising from whatever cause to the cotton thus consigned would be borne by the Factory till its delivery as indicated above.
This being, the nature of the contract between the consignor and the consignee in the present case we have no hesitation in agreeing with the courts below that the property in the goods was still with the Factory when the fire broke out on March 8, 1943.
Therefore the ordinary rule that it is the consignor who can sue will prevail here because it is not proved that the consignor had parted with the property in the goods, even though the consignments were booked in the name of the J. C. Mills.
We are therefore of opinion that the suit of the Factory was in view of these circumstances maintainable.
As to the suit by Ishwara Nand, he relies on two circumstances in support of his right to maintain the suit.
In the first place, he contended that he was the owner of the goods and that was why the railway receipt was endorsed in his favour by the consignor though it was booked to "self".
In the second place, it was contended that as an endorse to a document of title he was in any case entitled to maintain the suit.
The trial court found on the evidence that it had been proved satisfactorily that Ishwara Nand 588 was the owner of the goods.
It also held that as an endorse of a document of title he was entitled to sue.
These findings of the trial court on the evidence were accepted by the High Court in these words : "It was not contended before us that the finding arrived at by the learned court below that the plaintiff had the right to sue was wrong, nor could, in view of the overwhelming evidence, such an issue be raised.
The evidence on the point has already been carefully analysed by the court below.
We accept the finding and confirm it.
It was also pointed out that Ishwara Nand was the endorsed consignee and in that capacity he had in any case a right to bring the suit.
The correctness of this statement was not challenged before us.
" Thus there are concurrent findings of the two courts below that Ishwara Nand was the owner of the goods and that was why the railway receipt was endorsed in his favour.
In these circumstances he is certainly entitled to maintain the suit.
The contention that the plaintiffs in the two suits could not maintain them.
must therefore be rejected.
The contention under this head is that five of the consignments had been delivered to the J. C. Mills before March 8, 1943 and therefore the railway was not responsible for any loss caused by the fire which broke out after the consignments had been delivered on March 6 and 7, 1943.
It was urged that it was the fault of the J. C. Mills that it did not remove the consignments from the railway station by March 7 and the liability for the loss due to fire on March 8 must remain on the J. C. Mills.
The trial court had held in favour of the appellant with respect to these five consignments.
But the High Court reversed that finding holding that there was no real delivery on March 6 and 7, though the delivery book had been signed on behalf of the J. C. Mills and the railway receipts had been handed over to the railway in token of delivery having been taken.
It was not disputed that the delivery book had been signed and the railway receipts had been delivered to the railway; but the evidence was that it was the practice at that railway station, so far as the J. C. Mills was concerned, to sign the delivery book and hand over the railway receipts and give credit vouchers in respect of the freight of the consignment even before the goods had been unloaded from wagons.
It appeared from the evidence that what used to happen was that as soon the wagons 589 arrived and they were identified as being wagons containing consignments in favour of the J. C. Mills, the consignee, namely, the J. C. Mills, used to surrender the railway receipts.
, sign the delivery book and give credit vouchers in respect of the receipt of freight due even before the goods were unloaded from wagons.
This practice was proved from the evidence of Har Prashad (D.W. 6) who was the Assistant Goods Clerk at Morar Road at the relevant time.
He was in charge of making delivery of such goods, there being no Goods Clerk there.
He admitted that signature of Ishwara Nand as agent of the J. C. Mills was taken as soon as the consignments were received and identified by Ishwara Nand without being unloaded.
He further admitted that there had been no actual delivery to Ishwara Nand of the consignments and this happened with respect to all the five consignments.
Ishwara Nand signed the delivery book in token of having received the delivery and surrendered the railway receipts though when he did so the wagons were not even unloaded.
On this evidence the High Court held that it could not be said that there was any effective delivery of the goods to the J. C. Mills through Ishwara Nand, though token delivery was made inasmuch as the delivery book had been signed and the railway receipts surrendered.
It also appears from the evidence of Har Prashad that before the goods were actually removed, Ishwara Nand used to take the permission of Har Prashad to remove them.
This shows that though there might be token delivery in the form of signing the delivery book and surrendering the railway receipts, actual delivery used to take place later and the removal of goods took place with the permission of Har Prashad.
On this state of evidence the High Court was of the view that the so called delivery by signing delivery book and sur rendering the railway receipts was no delivery at all for till then the goods had not been unloaded.
The unloading of goods is the duty of the railway and there can be no delivery by the railway till the railway has unloaded the goods.
It is also clear from the evidence that even after token delivery had been made in the manner indicated above, the consignee was not authorised to remove the goods from the wagons and that it was the railway which unloaded the wagons and it was thereafter that the consignee was permitted to remove such goods with his permission as stated by Har Prashad in his evidence.
The High Court therefore held that there was no clear evidence that delivery of goods had been made over to the consignee in these cases.
Further there was no evidence to show that the consignee could remove the goods from the wagons without further reference to the railway, on the other hand it appeared that after such token delivery permission 590 of Har Prashad was taken for actual removal of goods.
There fore, the High Court came to the conclusion that real delivery had not been made when the fire took place on March 8, for the goods were till then in wagons and the railway was the only authority entitled to unload the same.
Till they were unloaded by the railway, they must be in the custody of the railway and no delivery could be said to have taken place merely by signing the delivery book and surrendering the railway receipts.
We are of opinion that on the evidence the view taken by the High Court is correct.
Though there was a token delivery as appears from the fact that railway receipts had been surrendered and the delivery book had been signed, there was no real delivery by the railway to the consignee, for the goods had not been unloaded and were still under the control and custody of the railway and Har Prashad 's evidence is that his permission had still to be taken before the goods could be actually removed by the consignee.
The contention that the delivery had been made to the consignee before March 8, 1943 must therefore in the peculiar circumstances of this case fail.
(iii).
It is next contended that damages should have been awarded at the rate of Rs. 38/ per bale which was tile contract price between the factory and the J. C. Mills.
This contract was made in November 1942.
The contract price is in our opinion no measure of damages to be awarded in a case like the present.
It is well settled that it is the market price at the time the damage occurred which is the measure of damages to be awarded.
It is not in dispute that the trial court has calculated damages on the basis of the market price prevalent on March 8.
In these circumstances this contention must also be rejected.
The next contention is that no interest could be awarded for the period before the suit on the amount of damages decreed.
Legal position with respect to this is well settled : (see Bengal Nagpur Railway Co. Limited vs Ruttanki Ramji and Others) (1).
That decision of the Judicial Committee was relied upon by this Court in Seth Thawardas Pherumal vs The Union of India(2).
The same view was expressed by this Court in Union of India vs A. L. Rallia Ram(3).
In the absence of any usage or contract, express or implied, or of any provision of law to justify the award of interest, it is not possible to award interest by way of damages.
Also see (1) 65 I.A. 66.
(2) (3) ; 591 recent decision of this Court in Union of India vs Watkins Mayer & Company(1).
In view of these decisions no interest could be awarded for the period upto the date of the suit and the decretal amount in the two suits will have to be reduced by the amount of such interest awarded.
We now come to the additional point raised in Ishwara Nand 's suit.
It is urged that Ishwara Nand 's consignment had reached Morar Road Railway Station on February 23, 1943 and Ishwara Nand should have taken delivery within three days which is the period during which under the rules no wharfage is charged.
The responsibility of the railway is Linder section 72 of the Indian Railways Act (No. 9 of 1890) and that responsibility cannot be cut down by any rule.
It may be that the railway may not charge wharfage for three days and it is expected that a consignee would take away the goods within three days.
It is however urged that the railway is a carrier and its responsibility as a carrier must come to an end within a reasonable time after the arrival of goods at the destination, and thereafter there can be no responsibility whatsoever of the railway.
It is further urged that three days during which the railway keeps goods without charging wharfage should be taken as reasonable time when its responsibility as a carrier ends; thereafter it has no responsibility whatsoever.
Under section 7 2 of the Indian Railways Act, the responsibility of the railway administra tion for the loss, destruction or deterioration of animals or goods delivered to the administration to be carried by railway is, subject to the other provisions of the Act, that of a bailee under sections 151, 152 and 161 of the Indian Contract Act, (No. 9 of 1872).
This responsibility in our opinion continues until terminated in accordance with sections 55 and 56 of the Railways Act.
The railway has framed rules in this connection which lay down that unclaimed goods are kept at the railway station to which they are booked for a period of not less than one month during which time the notice prescribed under section 56 of the Railways Act is issued if the owner of the goods or person entitled thereto is known.
If delivery is not taken within this period, the unclaimed goods are sent to the unclaimed goods office where if they are not of dangerous, perishable or offensive character they are retained in the possession of the railway.
Thereafter public sales by auction can be held of unclaimed goods which remain with the railway for over six months.
This being the position under the rules so far as the application of sections 55 and 56 is concerned, it follows that even though the res ponsibility of the railway as a carrier may come to an end within (1) C. As.
43 & 44 of 1963 decided on March 10, 1965.
592 a reasonable time after the goods have reached the destinationstation, its responsibility as a warehouseman continues and that responsibility is also the same as that of a bailee.
Reference in this connection is made to Chapman vs The Great Western Railway Company(1).
In that case what had happened was that certain goods had arrived on March 24 and 25.
On the morning of March 27, a fire accidentally broke out and the goods were consumed by the fire.
The consignor then sued the railway as common carrier on the ground that liability still subsisted when the goods were destroyed.
The question in that case was whether the liability of the railways was still as common carrier, on March 27 or was that of warehousemen.
The question was of importance in English law, for a common carrier under the English law is an insurer and is liable for the loss even though not arising from any default on his part while a warehouseman was only liable where there was want of proper care.
It was held that the liability as a common carrier would come to end not immediately on the arrival of the goods at the destination but sometime must elapse between the arrival of goods and its delivery.
This interval how ever must be reasonable and it was held in that case that reasonable time had elapsed when the fire broke out on March 27 and therefore the railway 's responsibility was not that of a carrier but only as warehouseman.
The position of law in India is slightly different from that in England, for here the railway is only a bailee in the absence of any special contract and it is only when it is proved that the railway did not take such care of the goods as a man of ordinary prudence would under similar circumstance take of his own goods of the same bulk, quality and value as the goods bailed, that the railway 's responsibility arises.
A warehouseman is also a bailee and therefore the railway will continue to be a warehouseman under the bailment, even if its responsibility as a carrier after the lapse of a reasonable time after arrival of goods at the destination comes to an end.
But in both cases the responsibility in India is the same, namely, that of a bailee, and negligence has to be proved.
In view of the rules to which we have already referred it is clear that the railway 's responsibility as a warehouseman continues even if its responsibility as a carrier comes to end after the lapse of a reasonable time after the arrival of goods at the destination.
The responsibility as a warehouseman can only come to end in the manner provided by sections 55 and 56 of the Railways Act and the Rules which have been framed and to which we have already referred as to the disposal of unclaimed goods.
In the present case under the Rules the goods had to remain at Morar (1) (1880) 5Q.B.D.278.
593 Road Railway Station for a period of one month after their arrival there and Ishwara Nand came to take delivery of them on March 10 well within that period.
It may be that as he did not come within three days he has to pay wharfage or what is called demurrage in railway parlance, but the responsibility of the railway as a warehouseman certainly continued till March 10 when Ishwara Nand went to take delivery of the goods.
As it has been found that there had been negligence within the meaning of sections 151 and 152 of the Indian Contract Act, the railway would be liable to make good the loss caused by the fire.
The appeals therefore fail with this modification that the decretal amount would be reduced by the amount of interest awarded for the period before the date of each suit.
The rest of the decree will stand.
The appellant will pay the respondents ' costs one set of hearing fee.
In CA 603/63 interest will be calculated from 6 8 62 in accordance with that order.
Appeal dismissed and decree modified.
[/INST]There was a fire at a railway station in which certain goods& were destroyed.
Two suits were filed claiming damage for loss of goods by 'the said fire.
The first suit was filed by a factory which claimed to be owner of the goods as consignor.
The other suit was filed by a consignee in whose favour the relevant documents were endorsed.
The Union of India resisted both the suits.
The trial court and the High Court concurrently held that the loss was due to the negligence of the Railways.
The1 Union of India appealed to this Court.
It was contended on behalf of the appellant : (1) The suits, as filed, were not maintainable.
(2) In the first suit delivery of the goods had been made to the consignee and the High Court 's finding to the contrary was wrong.
(3) Damages should have been awarded at the contract rat .
and not the market rate (4) Interest could not be awarded for the period before the suit on the amount of damages decreed.
(5) In the second suit notice had been given to the consignee that the consignment had arrived on February 23, 1943.
The consignee did not come to remove the goods till March 8, 1943 when the fire broke out, and the liability of the railway administration ceased after the lapse of reasonable time after arrival of the consignment at the railway administration.
HELD: (i) A railway receipt is a document of title to goods covered by it, but from that alone it does not follow, where the consignor and consignee are different, that the consignee is necessarily the owner of the goods and the consignor in such circumstances can never he the owner of the goods.
It is quite possible for the consignor to retain title in the goods himself while the consignment is booked in the name of another person.
In the first of the present suits the risk remained with the consignor according to the agreement of the parties, and it had not been proved that the consignor had parted with the property in the goods.
Therefore the suit by he consignor was maintainable.
[586 D H] In the second suit the railway receipt was endorsed in the consignees favour and the courts below had concurrently found that the consignee was the owner of the goods.
There could therefore be no dispute about the maintainability of the second suit also.
[588 D] (ii) Though there was a token delivery to the consignee in the first suit as appeared from the fact that the railway receipt had been sur 581 rendered and the delivery book had been signed, there was no redelivery by the railway to the consignee.
The goods had not been unloaded and were still under the control and custody of the railway and the evidence of the Assistant Goods Clerk was that his permission had still to be taken before the goods could be actually removed by the consignee.
The contention in the first suit that the delivery had been made to the consignee before March 8, 1943 therefore, in the peculiar circumstances of the case had to fail.
[590 C D] (iii) The High Court rightly calculated the damages on the basis of the on March 8 as it is well settled that it is the market price at lest be damage occurred which is the measure of the damages to be awarded.
[590 E F] (iv) In the absence of any usage or contract, express or implied, or of any provision of law to justify the award of interest it is not possible to award interest by way of damages and therefore no interest should have been awarded in the present two suits up to the date of filing of either suit.
[591 A] Bengal Nagpur Railway Co. Ltd. vs Ruttanji Rant, & Ors. 65 I.A. 66, Seth Thawardas Pherumal vs Union of India , Union of India v, A. L. Rallia Ram; , and Union of India V. Watkins Mayer & Co. C. As.
Nos. 43 and 44 of 1963 dt.
10 3 65, relied on.
(v) Under section 72 of the Indian Railways Act, the responsibility of the railway administration for the loss, destruction or deterioration of animals or goods delivered to the administration to be carried by railway is, subject to the other provisions of the Act, that of a bailee under sections 151, 152 and 161 of the Indian Contract Act.
The responsibility continues until terminated in accordance with sq. 55 and 56 of the Railways Act.
[591 E] It may be that under the Rules framed by the Railways goods are kept at the railway station of destination only for one month, and that demurrage has to be paid after three days of reaching the destination.
But the responsibility of the railway is under section 72 of the Indian Railways Act and it cannot be cut down by any rule.
Even if owing to the said Rules the responsibility of the railway as a carrier ends within a reasonable time after the goods have reached their destination station, its responsibility as a warehouseman continues and that responsibility L. the same at that of a bailee.
[592 E H] Chapman vs The Great Western Railway Company, (1880)5 Q.B.D. 278, distinguished.
In the present case the consignee (in the second suit) claimed the goods well within the period of one month mentioned in the rules.
The fact that he was liable to pay demurrage because he did not take delivery of the goods within three days did not relieve the railway of its respon sibility as warehouseman.
As it had been concurrently found by the courts below that there had been negligence by the railway within the meaning of sections 151 and 152 of the Indian Contract Act, the railway war, liable to make good the loss caused by the fire.
[593 A B]
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<s>[INST] Summarize the judgementSpecial Leave Petition (Civil) No. 123 17 of 1987.
From the Judgment and Order dated 2.9.1987 of the Madhya 619 Pradesh High Court in Misc.
Petition No. 3308 of 1985.
M.K. Ramamurthy and A.K. Sanghi for the Petitioners.
Vinod Bobde, P.S. Nair and K.V. Sreekumar for the Respond ents.
The following Order of the Court was delivered This petition for special leave is against the judgment dated 2.9.1987 of the High Court of Madhya Pradesh dismiss ing the petitioners ' writ petition (M.P. No. 3308 of 1985).
The petitioners demand regularisation of their services claiming to be daily rated workmen for a long time in the mines of the Diamond Mining Project, Panna of the National Mineral Development Corporation Ltd. Their demands are of regularisation and "equal pay for equal work" on the ground that they are discharging the same duties as the regular workers.
The management has throughout denied the petition ers ' claim and alleged that, in fact, the petitioners have been continued on rolls on humanitarian grounds for several years, even though there is no work for them; and as such, there is no question of regularising the petitioners and giving them the pay of regular workers when in fact they are not doing any work for a long time.
The High Court rejected the petitioners ' claim and came to the following conclusion: "The petitioners are not regular employees, they do not have any specific job to do, they are surplus to the establish ment and merely kept on the roll on humanitarian ground.
The respondents are also running in heavy losses during the last three years and it is not possible to absorb the petitioners immediately as regular workmen.
In fact, the petitioners are being paid their daily wages in spite of their being no work available for them.
" Aggrieved by dismissal of the writ petition, the petitioners have filed this petition for special leave to appeal under Article 136 of the Constitution.
In response to notice of this petition, a counter affi davit has been filed on behalf of respondent No. 2 reiterat ing the stand taken before the High Court.
It has been stated therein that there is no vacancy in the establishment to absorb the petitioners and the accumulated loss to 620 the establishment as on 31st March, 1988 is Rs. 10,29,40,583.
A copy of the balance sheet has also been enclosed with the counter affidavit.
It has been stated that the petitioners being surplus to the requirement of the Project, they cannot be regularised and their retention on the rolls is purely on humanitarian grounds so far.
Further facts have been stated in support of their contention.
It has also been stated that a Voluntary Retirement Scheme offering considerable amount to these daily rated workmen has been framed, which is Annexure R V to the counter affi davit.
This document shows the amount of retrenchment com pensation and the ex gratia payment offered to the 63 daily rated workmen under this Scheme.
The 54 petitioners are included therein.
It was stated at the hearing before us that 9 out of these 63 daily rated workers mentioned in Annexure R V have accepted this Scheme of Voluntary Retire ment and respondent No. 2 is prepared to give benefit of the same even to those who may not have agitated their claim.
We do not find any ground to interfere with the High Court 's decision in view of the clear findings supported by evidence that there are no vacancies or work available in the establishment for absorption of the petitioners and that for quite some time they have been continued on rolls and paid in spite of there being no work for them.
On these facts, the question of directing their absorption and regu larisation does not arise.
The principle of regularisation of a daily rated workman and payment 'to him of the pay equal to that of a regular workman arises only when the daily rated workman is doing the same work as the regular workman and there being a vacancy available for him, he is not absorbed against it or not even paid the equal pay for the period during which the same work is taken from him.
On the clear findings in this case, this is not the position.
This petition must, therefore, fail.
In spite of our above conclusion, keeping in view the offer made on behalf of respondent No. 2 in the counter affidavit together with Annexure R V thereto which was reiterated at the heating before us, we direct that all the 63 daily rated workmen including the 54 petitioners herein mentioned in the aforesaid Annexure R V to the counter affidavit be given the benefit of the Voluntary Retirement Scheme framed by respondent No. 2 and they be paid the specified amounts in addition to their all other dues.
Subject to this direction, the special leave petition is dismissed.
No costs.
P.S.S. Petition dismissed.
[/INST]To a question whether lamination of duty paid kraft paper with polyethylene resulting in 'polyethylene laminated paper ' would amount to 'manufacture ' and excisable under Excise Law, the Collector of Central Excise (Appeals) an swered in the negative, and held that the appellant was eligible to claim refund of duty paid by it.
In reaching this finding he followed the decision in Standard Packag ings, Nellore vs Union of India, AP.
Against the said order, the Collector of Central Excise preferred an appeal before the Customs, Central Excise and Gold (Control) Appellate Tribunal.
The Tribunal reversed the order of the Collector (Appeals) and held that the appellant was liable to duty.
Aggrieved, the appellant has preferred this appeal under Section 35 L(b) of the .
It was contended that duty was already paid on kraft paper and there was no change in the essential characteristic or the user of the paper after lamination, and that both the goods belong to the same entry.
Dismissing the appeal, HELD: 1.1.
By process of lamination of kraft paper with polyethylene different goods come into being.
Laminated kraft paper is distinct, separate and different from the kraft paper.
Lamination, indisputably by the well settled principles of excise law, amounts to manufacture.
[632C D] 631 1.2. 'Manufacture ' is bringing into being goods as known in the excise laws, that is to say, known in the market having distinct, separate and identifiable function.
[632F] 1.3.
Even if the goods belong to the same entry, the goods are different identifiable goods, known as such in the market.
If that is so, manufacture occurs, and if manufac ture takes place, it is dutiable.
[632F] Empire Industries Ltd. & Ors.
vs Union of India & Ors.
, ; and Collector of Central Excise, Kanpur vs Krishna Carbon Paper Co., , relied on.
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<s>[INST] Summarize the judgementvil Appeal Nos.
2266 69 of 1979.
705 From the Judgment dated 9.8.1978 of the Punjab and Haryana High Court in L.P.A. Nos.
576 to 579 of 1975.
Harbans Lal and M.V. Goswami for the Appellants.
Iqbal Singh for the Respondent.
The following Order of the Court was delivered: These appeals by special Leave are directed against the common judgment and decree of the Punjab and Haryana High Court passed in L.P.A. Nos.
576 79 of 1975.
Three brothers, by means of four sale deeds executed on June 25, 1968, sold some parcels of land to Harbhajan Singh respondent herein.
The 4th brother by the name of Ujagar Singh, whose legal representatives are the appellants herein,.
filed four suits of preemption ,against the vendee and those were decreed on July 15, 1970, on terms of payment of pre emption money on or before August 30, 1970.
Four appeals were filed by the plaintiff pre emptors before the District Judge for the reduction of the pre emption money.
On an application moved by the pre emptors the time for deposit of the amount fixed under the decree by the Trial Court was extended till further orders.
The appeals finally were rejected under Order 41 Rule 3 of the Code of Civil Procedure as being insufficiently stamped and hence not properly presented.
Before hand, however, 'the laintiff pre emptors all the same, deposited the pre emption amount in the Trial Court, on their own, on October 26, 1970.
After the rejection of their appeals, the pre emptors sought execution of the pre emption decrees which attracted objections by the vendee judgment debtor.
The primary objec tion raised was that the suits stood automatically dismissed for non deposit of the preemption money within the time identically stipulated under the questioned decrees.
The plea of the vendee was based on the mandate of Order 20 Rule 14, Civil Procedure 'Code whereunder the Court when decree ing the claim to pre emption is required to specify in the decree on or before which the pre emption money shall be paid, if not already paid, and further if it is not so paid, the suit shall stand dismissed with costs.
(Whatever is relevant in Order 21 Rule 14 alone has been taken note of).
The date specified by the Trial Court as said before was August 30, 1970 and under the interim orders of the Appel late Court the time for depositing the said money was ex tended till 706 further orders.
Undeniably the Court never passed any fur ther orders in that regard and thus the time for depositing the said money stood extended without any limit.
objec tion was sustained by the Trial/ Executing Court.
On appeal to the Appellate Court at the instance of the pre emptors, the District Judge took .a contrary view permitting the execution to proceed.
A learned Single Judge of the High Court in appeal upheld the view of the District Judge, but a Division Bench of the High Court.
In Letters Patent Appeals, reversed the District Judge as also the Single Judge uphold ing the objection by the vendee that there were no decrees which could be executed.
We have heard learned counsel for the appellant for he alonewas present.
There has been a sea change in the law of pre emption in the States of Punjab and Haryana where from these appeals have arisen.
Whereas in Punjab the Punjab Pre emption Act itself has been repealed, in Haryana it has substantially been chopped down by justicing.
This Court in Atam Parkash vs State of Haryana & Ors., ; declared ultra vires section 15(1) of the Punjab Pre emption Act, as ap plicable to Haryana, whereunder certain relatives of the vendor had been given the right to pre empt a sale of immov able.
property.
The view of this Court and the present state of law is not by any means insignificant or irrelevant for judging the present matter and for resolving the controversy in hand.
Rather its pervasive thought permeats the mind.
Learned counsel for the appellants would have the con troversy determined on the anvil of Section 148 of the Code of Civil Procedure, pleading for time to be extended by the Court, as it is extendable when any period is fixed or granted by the Court for the doing of any act prescribed or allowed by the Court, even though the period originally fixed or granted has already expired.
He has brought to our notice that in the main matter when the appeal was rejected by the District Judge as being insufficiently stamped time was asked from the District Judge to make good the deficien cy in the stamp duty but that was rejected and though he concedes that the matter was not taken up in revision before the High Court, it is still contended that this Court should exercise its plenary power to extend the time in the inter ests of justice and have the Court fee made good.
He also concedes that when the District Judge was asked to extend and specify the time for deposit of the pre emption money, he had declined to exercise his discretion, so as to regula rise payment, when the appellants had by themselves 707 deposited the pre emption money on October 26, 1970 before hand,leaving the matter to be agitated before the executing Court.
Likewise it is contended that this Court can and should specify the time for deposit so as to regularise it in exercise of powers under Section 148 C.P.C. He also high lights that the mistake herein was that of the Courtand for both the propositions he takes aid of Jogdhayan vs Babu Ram & Ors., ; and Jagat Dhish Bhargava vs Jawahar Lal Bhargava and Others, ; In any event he concedes that for the later wrongful non exercise of discre tion of the District Judge, the matter was not taken in Second Appeal or Revision, as the case may be, before the High Court.
We have pondered over, the matter.
Our view may appear some what slanting but we cannot disassociate ourselves from the canvass now spread, showing there is no law of pre emp tion permitting a decree to be drawn in terms of Section 15(1) of the Punjab Pre emption Act.
Were we to exercise at all the discretions on the subject afore mentioned we would in any event be completing the process of decreeing the suits; the suits which have been held to fall down under Order 20 Rule 14 of the Code of Civil Procedure, tantamount ing to their dismissal, and that too on present day when such decrees cannot be passed.
The High Court however, took the controversy in a different light.
It took the view that the insufficiently stamped appeals be/ore the District Judge were no appeals in the eye of law, as was contende don behalf of the vendee, and the view of the District Judge in not extending time was right as it was rightly considered that the appeals had not been entertained at all.
Support was also taken for its view by the High Court from the circumstance of the order of the Court extending time ex parte, which conferred no obligation on the vendee to treat the decree operative against him as and when the pre emptors chose to deposit the pre emption money.
The High COurt on this reasoning restored the judg ment of the Trial/Executing Court,upholding the objections of the vendee.
Where the High Court arrived by following one way, we have been led to arrive by another.
The end result, however, is the same that the objections of the vendee mustremain sustained and the pre emptor appellants must fail in the event,not getting their suits for pre emption de creed.
The appeals must thus inevitably fail and are hereby dismissed.
Decreetal money deposited by the appellants may be permitted to be withdrawn by them, ii not already with drawn.
No costs for there is no opposition.
V.P.R. Appeals dis missed.
[/INST]Three brothers executed four sale deeds on June 25, 1968, to respondent.
The 4th brother, whose legal represen tatives are the appellants, filed four suits of pre emption against the vendee respondent and those were decreed on terms of payment of pre emption money on or before August 30, 1970.
The plaintiff pre emptors appellants filed four appeals before the District Judge for the reduction of the pre emption money.
On an application moved by the pre emptors the time for deposit of the amount fixed under the decree by the Trial Court was extended till further orders.
The appeals were rejected under Order 41 Rule 3 of the Code of Civil Procedure as being insufficiently stamped and not properly presented.
Before hand, however on 26.10.1970, the plaintiff pre emptors, deposited the pre emption amount in the Trial Court.
The pre emptors sought execution of the pre emption decrees.
The vendee judgment debtor raised objections stat ing that the suits stood automatically dismissed for non deposit of the pre emption money within the time identically stipulated under the decrees.
The objection was sustained by the Trial/Executing Court.
704 The appeal to the Appellate Court at the instance of the preemptors, was allowed, permitting the execution to pro ceed.
A Single Judge of the High Court in further appeal upheld the view of the District Judge, but the Division Bench of the High Court allowed the Letters Patent Appeals, upholding the objection made by the vendee respondent, that there were no decrees which could be executed, against which these appeals by special leave to this Court .were filed.
The appellants contended that the controversy could be determined on the anvil of Section 148 of the Code of Civil Procedure by extending time by the Court, as it was extend able when any period was fixed or granted by the Court for the doing of any act prescribed or allowed by the Court, even though the period originally fixed or granted had already expired; that this Court should exercise its plenary power in the interests of justice to extend the time.
Dismissing the appeals, this Court, HELD: 1.
There is no law of pre emption permitting a decree to be drawn in terms of Section 15(1) of the Punjab Pre emption Act.
Were the Court to exercise at all the discretions on the subject, the Court would in any event be completing the process of decreeing the suits; the suits which have been held to fall down under Order 20 Rule 14 of the Code of Civil Procedure, tantamounting to their dismiss al, and that too on present day when such decrees cannot be passed.
[707C D] 2.
The objections of the vendee must remain sustained and the pre emptor appellants must fail in the event, not getting their suits for pre emption decreed.
Decretal money deposited by the appellants may be permitted to be withdrawn by them, if not already withdrawn.
[707F G] Atarn Parkash vs State of Haryana & Ors., ; , followed.
Jogdhayan vs Babu Ram & Ors., ; and Jagar Dhish Bhargava vs Jawahar Lal Bhargava and Others, ; , referred to.
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<s>[INST] Summarize the judgementCivil Appeal Nos.
149 1 1501 of 1974.
From the Judgment and Order dated 21.12.1973 of the High Court of Delhi in C.W. Nos 954/71, 211 to 218 and 249 and 251 of 1972.
F.S. Nariman, U.S. Prasad, S.K. Mehta, M.K. Dua, S.M. Sarin, Aman Vachhar and R. Jagannath for the appellants.
Anil Dev Singh, Miss Halida Khatoon.
P. Parmeswaran for the Respondents.
The judgment of the Court was delivered by RANGANATH MISRA, J.
These appeals are by certificate under Article 132 and involve the determination of the amplitude contained and nature of the power conferred on the President by clause (c) of the second proviso of Article 311(2) of the Constitution.
18 policemen Sardari Lal and two others being Sub Inspectors and the remaining being either Head Constables or Constables of the Delhi Armed Police Force were dismissed from service by separate but similar orders dated 14th April, 1967, by way of punishment.
They challenged those orders before the Delhi High Court mainly contend 707 ing that the exercise of power under clause (c) of the second proviso to Article 311(2) was not upon President 's personal satisfaction and as there had been no inquiry as mandated by Article 311(2), the dismissals were bad.
The High Court did not accept the contention and rejected the writ petitions.
The dismissed policemen carried appeals to this Court and by judgment dated 2 1st January, 1971 in Sardari Lal vs Union of India & Ors., ; a Constitution Bench of this Court set aside the judgment of the High Court in each of the writ petitions and quashed the several orders of dismissal on the ground that each of them was illegal, ultra vires and void.
This Court held: "On the principles which have been enunciated by this Court, the function in clause (c) of the proviso to Article 311(2) cannot be dele gated by the President to any one else in the case of a civil servant of the Union.
In other words, he has to be satisfied personally that in the interest of the security of the State, it is not expedient to hold the inquiry pre scribed by clause (2).
In the first place, the general consensus has been that executive functions of the nature entrusted by the Articles, some of which have been mentioned before and in particular those Articles in which the President has to be satisfied him self about the existence of certain fact or state of affairs cannot be delegated by him to any one else.
Secondly even with regard to clause (c) of the proviso, there is a specific observation in the passage extracted above from the case of Jayantilal Amrit Lal Shodban [1964] 5 SCR 294 that the powers of the President under that provision cannot be delegated.
Thirdly, the dichotomy which has been specifically introduced between the authority mentioned in clause (b) and the President mentioned in clause (c) of the proviso cannot be without significance.
The Constitution makers apparently felt that a matter in which the interest of the security of the State had to be considered should receive the personal attention of the Presi dent or the head of the State and he should be himself satisfied that an inquiry under the substantive part of clause (2) of Article 311 was not expedient for the reasons stated in clause (c) of the proviso in the case of a particular servant." Following the judgment of this Court, the dismissed police men were reinstated in service with effect from 16th April, 1971.
On 5th of June, 1971, fresh orders of dismissal were served on these policemen again 708 invoking the power under clause (c) of the second proviso to Article 311(2) for dispensing with the inquiry.
One of the representative orders is extracted below: "Whereas you, Shri Sardari Lal, sub Inspector being No. D 331 (present No. D 1177) of Delhi Police, held your office during the pleasure of the President." "And whereas the President, after considering all the facts and circumstances of your case, is satisfied under sub clause (c) of the proviso to clause (2) of Article 311 of the Constitution, that in the interest of the security of the State it is not expedient to hold, in relation to you, such inquiry as is referred to in clause (2) of the said Article 311 of the Constitution." "Now, therefore, the President is pleased to dismiss you from service with immediate effect." Several writ applications were again flied before the High Court.
It was inter alia contended that the order of dismissal without an inquiry aS envisaged in Article 311(2) was vitiated as the power under sub clause (c) of the second proviso to Article 311(2) had not been made upon personal satisfaction of the President.
In the returns made to the Rule to two separate affida vits one by the Inspector General of Police and the other by a Joint Secretary to the Union Government in the Ministry of Home Affairs it was maintained that the President had personally considered all the facts and circumstances of each case and after having satisfied himself, passed the order that in the interest of the security of the State, it was not expedient to hold the inquiry.
The original orders of the President along with the connected papers were placed before the High Court and the High Court held: "The contention, therefore, that the President himself did not pass the impugned orders is rejected.
The question for decision then is whether the court can scrutinize and examine the facts and circumstances that led the President to arrive at the satisfaction that it was not expedient in the interest of the security of the State to hold the inquiry envisaged in Article ,311(2) against the petitioners, and if so, to what extent." 709 While examining this aspect of the matter, the High Court relied on the ratio of the decision of this Court in Sardari Lal 's case (supra) and examining the second aspect of the contention, the High Court held: "The result, therefore, is that the exercise of power by the President under clause (c) to the proviso to Article 311(2) is fully covered by clause (1) of Article 361 and the President is not answerable to any court for the exer cise and performance of his powers and duties under this clause of the proviso to Article 311 and no court has jurisdiction to examine the facts and circumstances that led to the satisfaction of the President envisaged in clause (c) except probably on the ground of mala fide.
" The plea of mala fides is based upon the alleged factual situation that the respective impugned orders had already been taken by the Government and the President simply en dorsed them was not entertained by the High Court and ulti mately each of the writ petitions was dismissed.
Mr. Nariman, learned counsel appearing on behalf of the appellants has advanced three contentions in support of these appeals: (1) the impugned order of dismissal in 1971 which is claimed to have been passed on the personal satisfaction of the President is vitiated in view of the rule in the case of Shamsher Singh & Anr.
vs State of Punjab, ; (2) appellants having been reinstated in service in terms of the judgment of this Court, without leave of the Court, no second order of dismissal on the same material could have been passed; and (3) the High Court was wrong in holding that the suffi ciency of satisfaction of the President was not justiciable.
The first aspect argued by Mr. Nariman is on the basis of the reversal of the view expressed by this Court in Sardari Lal 's case (supra) by a later larger Bench judgment of this Court.
The ratio in Sadari Lal 's case came to be considered in Shamsher Singh 's case (supra) by a seven Judge Bench.
Ray, CJ., who spoke for five members of the bench and with whom by a separate judgment, the remain ing two learned Judges agreed spoke thus: 710 "The decision in Sardari Lal 's case that the President has to be satisfied personally in exercise of executive power or function and that the functions of the President cannot be delegated is with respect not the correct statement of law and is against the estab lished and uniform view of this Court as embodied in several decisions to which refer ence has already been made.
These decisions are from the year 1955 up to the years 1971.
The decisions are Rai Saheb Ramjawaya Kapur vs State of Punjab, ; A. Sanjeevi Naidu vs State of Madras, ; and U.N.R. Rao vs Smt.
Indira Gandhi, These decisions neither re ferred to nor considered in Sardari Lal 's case." "The President as well as the Governor is the Constitutional or formal head.
The President as well as the Governor exercises his powers and functions conferred on him by or under the Constitution on the aid and advice of his Council of Ministers, save in spheres where the Governor is required by or under the Constitution to exercise his functions in his discretion.
Whoever the Constitution requires the satisfaction of the President or the Governor for the exercise by the President or the Governor of any power or function, the satisfaction required by the Constitution is not the personal satisfaction of the President or the Governor but the satisfaction of the President or Governor in the Constitution al sense in the cabinet system of Government, that is, satisfaction of his Council of Minis ters on whose aid and advice the President or the Governor generally exercise all his powers and functions.
The decision of any minister or officer under rules of business made under any of these two Articles 77(3) and 166(3) is the decision of the President or the Governor respectively.
These Articles did not provide for any delegation.
Therefore, the decision of Minister or Officer under the rules of busi ness is the decision of the President or the Governor.
" In their writ petitions, each of the appellants had contend ed before the High Court, following the ratio of Sadari Lal 's case which was then the law, that the President had not been personally satisfied before exercise of the power under the proviso to dispense with the inquiry and the respondents had taken pains to establish by pleading and producing the original records that the President had satis fied himself person 771 ally before be made the order dispensing with the inquiry.
To reduce the argument on this aspect and to have an exact impression of how the impugned orders were made, we directed learned counsel appearing for the Union of India to produce the original record and the same has been put before this Court.
It transpires therefrom that the papers were placed by the Ministry of Home Affairs for the consideration of the President by the Joint Secretary of the Union Territory of Delhi on 22nd of March, 1971, and were returned with a note of 20th of April, 1971, to the effect that the President would like to have the advice of the Council of Ministers in the matter.
A draft note for the Cabinet was prepared relat ing to the matter and as the record indicates it got through the Cabinet and the Prime Minister recorded her approval.
Thereafter, it was again placed before the President along with a note prepared on 25th May, 1971.
The note clearly indicated: "President 's Secretariat may kindly see their note extracted at pre page 7/n.
As desired by the President, the matter was placed before the Council of Ministers.
A copy of the Note submitted to the Cabinet may kindly be seen at flag 'H '.
The Cabinet has approved the propos al contained in paragraph 6 thereof.
Minutes of the Cabinet meeting may be seen at flag `I '." "It is requested that the matter may now be placed before the President for consideration.
" On 2nd June, 1971, the President made the following order: "I have considered the cases of the eighteen Police officers, whose names are given in the list appended to this order.
I have also considered all the facts and circumstances of their cases stated in the notes of the Minis try of Home Affairs, dated March 22, 1971, and May 25,1971." "I am satisfied, under paragraph (c) of the proviso to clause (2) of Article 311 of the Constitution, that in the interest of the security of the State it is not expedient to hold an inquiry into the case of any one of these Police Officers.
I accordingly order that these eighteen Police Officers be dis missed from service with immediate effect.
" It is clear from what has been extracted above that the order of the President was not on the basis of his personal satisfaction as required 712 by the Rule in Sardari Lal 's case but was upon the aid and advice of the Council of Ministers, as required in Shamsher Singh 's case.
In view of this factual position, learned counsel for the appellants fairly stated that there was no force in his first contention.
We see no force in the second point canvassed by Mr. Nariman.
This Court quashed the orders of dismissal on account of noncompliance of the requirements of the law and when the Police Officers returned to service it was open to the employer to deal with them in accordance with law.
No leave of this Court was necessary for making a fresh order in exercise of the disciplinary jurisdiction after removing the defects.
Now coming to the third contention of Mr. Nariman, the matter appears to have been concluded by the judgment of this Court in the case of Union of India & Anr.
vs Tulsirara Patel & Ors., ; Those were also cases of striking railwaymen against whom orders of dismissal had been made after dispensing with the inquiry by exercise of powers under the same proviso.
Four learned Judges repre senting the majority spoke through Madon, J. and this Court held that there was a constitutional obligation to record in writing the reason for the satisfaction that one of the sub clauses was applicable and if such reason was not re corded in writing, the order dispensing with the inquiry and the order of penalty following thereupon would both be void and unconstitutional.
The Court further stated that communi cation of the resaon to the aggrieved Government servant was not obligatory but perhaps advisable.
The record of the case produced before us clearly indicates that the reason has been recorded though not communicated.
That would satisfy the requirements of the law as indicated in Tulsiram Patel 's case.
The plea of mala fides as had been contended before the High Court and casually reiterated before us arises out of the fact that typed orders dated 3rd of June, 1971, were already on record in the file when the papers were placed before the President; such a contention is without any substance.
The President 's order is dated 2nd of June and the typed orders of dismissal bear the date of the following day.
In this setting, there is no scope to suggest that typed orders representing Government 's decision were avail able on the record by the time the matter was placed before the President.
All the legal contentions have failed.
Ordinarily in such a situation, the appeals have to be dismissed.
Mr. Nariman, however, has placed before us for consideration a statement made by the Home Minister before the Lok Sabha on 18th of December, 1978.
Therein he had stated: 713 " . . . 18 persons who have been dismissed by invoking clause (c) of the provi so to Article 311(2) will be considered for grant of compassionate allowances.
" This statement was also reiterated in the papers placed before the President.
Obviously the Government intended to pay them compassionate allowances.
We have no sympathy for indiscipline.
In fact, in an orderly force like the Police, indiscipline is bound to give rise to serious problems of administration.
It is, however, unnecessary to go into that aspect of the matter as the Government had made it known that they intended to treat even these 18 policemen liberal ly by giving them compassionate allowances.
The matter has been sufficiently protracted, the first order of dismissal was made a little more than 20 years back and in the mean time some of the policemen out of this group of 18 have died.
In such circumstances to leave this matter for a future date for fixing compassionate allowance would not be just and proper.
We had suggested to the learned counsel appearing for the Union of India to have instructions and give us an indication of what was in view of the Government when compassionate allowance was thought of.
There has been no response yet.
We are not prepared to detain delivery of the judgment on that ground.
In our opinion, the situation would be met in a just way if instead of paying a recurring allowance, a lump sum amount is paid to the policemen who are alive or their legal representatives in the case of the policemen who are dead.
We accordingly direct that in the case of Sub Inspectors who were dismissed, a lump sum amount of Rs.60,000 (Rupees Sixty Thousand only), in the case of Head Constables who were dismissed a sum of Rs.50,000 (Rupees Fifty Thousand only) and in the case of Constables a lump sum of Rs.40.000 (Rupees Forty Thousand only) should be paid within one month from today.
The appeals are dismissed subject to the direction for payment of the lump sum amounts indicated above in lieu of compassionate allowance.
There would be no orders for costs.
N.P.V. Appeals dis missed.
[/INST]Sections 306 and 307 of the Code of Criminal Procedure, read together clearly indicate that where the Sessions judge disagrees with the verdict of the jury and is of the opinion that the case should be submitted to the High Court, he must submit the whole case against the accused, not a part of it.
If the jury returns a verdict of guilty in respect of some charges and notguilty in 961 respect of others he cannot record his judgment of acquittal in respect of the latter charges in agreement with the jury in contravention of the mandatory provision Of section 307(2) of the Code.
Such recording must have the effect of preventing the High Court from considering the entire evidence against the accused and exercising its jurisdiction under section 307(3).
Hazari Lal 's case, (1932) 1.
L. R.//Pat. 395 and Ramjanam Tewari, , approved.
Emperor vs jagmohan, 1.
L. R. (1947) Allahabad 240, and Emperor vs Muktar, , disapproved.
The Emperor vs Bishnu Chandra Das, , King Emperor vs Ananda Charan Ray, , and Emperor vs Nawal Behari, , considered.
Consequently, in a case where eight persons were put up for trial in the Court of Session charged under sections I47 and 304/I49 Of the Indian Penal Code and four of them were further charged under section 201 of the Indian Penal Code and the jury returned a unanimous verdict of not guilty under section 304/I49 and guilty under sections 147 and 201 and the Judge accepting the former recorded a judgment of acquittal in the case of each accused but disagreeing with the latter referred the matter to the High Court, the reference was incompetent and the High Court was in error in acting upon it and its judgment must be set aside.
Held further, that although the proper order in such a case should be to remit the case to the trial court for disposal according to law, in view of the long lapse of time and peculiar circumstances of this case the reference must be rejected.
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<s>[INST] Summarize the judgementCivil Appeal No. 974 of 1975.
(Appeal by Special Leave from the Judgment and Order dated 25 6 1975 of the Gujarat High Court in Spl.
Civil Appln.
No. 1223/74).
D.V. Patel and S.S. Khanduja, for the Appellant.
885 U.R. Lalit, P.H. Parekh and Miss Manju jatley, for Respondent No. 1.
M.N. Shroff, for Respondent No. 2.
The Judgment of the Court was delivered by GUPTA, J.
The appellant was elected a councillor of Anjar municipality in Kutch District sometime in 1972, and later, President of the municipality.
On June 30, 1973, after he had been elected President, the appellant applied to the chief officer of the municipality for allotting to him a 'plot of land admeasuring 18 feet x 16 feet situate in the town of Anjar.
In his application the appellant stated that he wanted the plot for running a flour mill temporarily until he got a suitable plot from the Govern ment.
By his order dated July 5, 1973 the chief officer granted the request permitting the appellant to hold the land on payment of rent on condition, inter alia, that the land should be vacated whenever 'the municipality so or dered.
The first respondent who is a resident of Anjar applied to the Collector of Kutch under section 38 of the Gujarat Municipalities Act, 1963 (referred to as the Act hereinafter) for declaring that appellant 's office has "become vacant" as he has disabled himself from continuing as a councillor by taking lease of the land from the munici pality.
The Collector having heard the parties held that the appellant had got the land by misusing his position as President of the municipality incurring thereby the disqual ification referred to in section 38(1)(b)(i) of the Act which disabled him from continuing to be a councillor and declared that his office had become vacant.
The appellant before us preferred an appeal under section 38(4) of the Act to the State Government against the Collector 's order.
The State Government allowed the appeal and dismissed the application of the first respondent.
It was held that the land was allotted to the appellant in accordance with the by laws of the municipality and that there was no evidence of the appellant exerting any influence on the chief offi cer.
The first respondent challenged the order of the State Government by filing a writ petition in the Gujarat High Court.
The learned Judge of the High Court who heard the petition allowed the same, quashed the order of the State Government, and restored the order made by the Collector.
This appeal by special leave is directed against the judg ment of the High Court allowing the writ petition.
The appeal turns on section 38(1)(b)(i) of the Act which reads as follows: "38.
Disablilties from continuing as a councillor.
(1) If any councillor during the term for which he has been elected or nomi nated (a) x x x (b) acts as a councillor in any matter (i) in which he has directly or indirectly, by himself or his partner, any such share or interest as is de:scribed in clause (i), (ii), (iii), (v) or (vii) of sub section 886 (3) of section 11, whatever may be the value of such share or interest, or . . . . . he shall subject to the provisions of sub section (2) be disabled from continuing to be a councillor and 'his office shall become vacant.
" The provisions of sub section (2) are not relevant for the present purpose.
Section 11 of the Act enumerates, inter alia, the "gener al disqualifications for becoming a council lor" and specifies the cases to be treated as exceptions.
Section 11(2)(c) disqualifies a person from being a councillor "who, save as hereinafter provided, has directly, or indi rectly, by himself or his partner any share or interest in any work done by order of a munic ipality or in any contract or employment with or under or on behalf of a municipality '.
Sub section 3(A)(i) of section 11 which con tains an exception to this rule provides: "(3) A person shall not be deemed to have incurred disqualification (A) under clause (c) of sub section (2) by reason of his (i) having any share or interest in any lease, sale or purchase ;of any immovable property or in any agreement for the same." Thus a person is disqualified from becoming a councillor if he. has a direct or indirect interest in any contract with the municipality, but having any share or interest in any lease of immovable property or in any agreement for the same is not a disqualification.
Section 38(1)(b) (1),quoted above however provides that if any councillor during the term for which he has been elected "acts as a councillor" in acquiring a direct or indirect share or interest in any lease, he shall be disabled from continuing to be a council lor.
We have noted earlier that section 11(3)(A)(i) is an exception to.
the general disquali fication under section 11(2) (c), section 38(1) (b) (i) appears to be an exception to that exception.
This means that though having an inter est in any lease from municipality is not a disqualification for becoming or continuing as a councillor, if the council lor "acts as a councillor" in getting such lease from the municipality, he shall be 'disabled from continuing to be a councillor.
The president of the municipality being a council, lot, this provision also applies to him.
The ques tion therefore is whether the appellant in this case acted as a councillor in the matter of allotment of the land to him.
Section 275 of the Act authorises the municipality to make bylaws not inconsistent with the Act.
The Anjar municipality has framed by laws regulating the conditions on which permission may be given for the temporary occupa tion of public streets or land.
An English translation of by law 4 of these by laws which are in Gujarati reads: "Permission will be given for the, use of public road or land within the municipal limits but not of private land for temporary period for the matters mentioned in Schedule 1 hereto on advance payment of fee as stated in the Schedule.
887 Any person who intends to occupy such land shall have to make a written application to the chief officer.
But to give such permis sion or not shall be within the absolute discretion of the chief officer.
" Schedule 1 mentioned here prescribes the fees payable by the applicant on such permission being granted.
The chief officer in this case permitted the appellant to occupy the land in question in exercise of the power given to him by this by law.
The High Court found that the appellant acted as a councillor and President of the municipality in having the plot allotted to him mainly upon the provisions of sections 49 and 45 of the Act.
Section 49 defines the power and duties of the chief officer.
Sub section (1)(a) of 'sec tion 49 which is relevant in this context is as follows: "49.
Power and duties of chief officer. (1) The chief officer shall (a) subject to the general control of the president watch over the financial and executive administration of the municipality and perform all the duties and exercise all the powers specifically imposed or conferred upon him by, or delegated to him under, this Act.
" Section 45 enumerates the functions of the President; one of the functions is to exercise supervision and control over the acts and proceedings of all officers and servants of the municipality in matters of executive administration.
The High Court after referring to these provisions observed that the chief officer being under the general control of the president in all matters of executive ,administration, must have felt himself bound to grant the appellant s applica tion.
The High Court referred to an earlier application for the plot made by one Karan Kanji which the chief officer had rejected.
There is also a finding that by law 4 did not permit the use of the plot for the purpose for which the appellant had applied and that the chief officer went out of his way to help his president.
The High Court concluded that if the appellant had not been a councillor of the municipality and its president, his application would have met with the same fate as Karan Kanji 'section The legality of the chief officer 's order is not however an issue in this case, and the question whether or not the intended use of the plot by the appellant was beyond the scope of by law 4 need not detain us.
According to the High Court it was only because the appellant held the office of president 'of the municipality that the chief officer allowed his application.
This may or may not be true, but it is not a matter relevant to the real question that arises for consideration in this case.
Section 38(1)(b)(i) disables a councillor from continuing as such if he "acts as a councillor" in the matter of allotment of any land to himself, there is no bar in the Act to a coun cillor getting a lease of the land from the municipality as would appear from section 11(3)(A)(i).
It is only in a case where he acts as a councillor in getting the lease that he is disqualified.
There is nothing in the record of this case to show that the appellant had acted as a councillor to have the plot allotted to him 888 self. 'Even if the chief officer was influenced by the fact that the applicant before him was president of the munici pality, that would not attract section 38(1)(b)(i).
It is true that section 45 confers a general power of supervision and control on the president over the acts of all officers of the municipality and section 49, which enumerates the power and duties of chief officer, also makes him subject to the general control of the president in the discharge of these powers.
But the general power of supervision con ferred on the president does not, in our opinion,imply that in every case where he applies for a lease, which he is entitled to do as section 11(3)(A) (i) indicates, he should be deemed to have "acted" within the meaning of section 38(1)(b), otherwise, the president of a municipality under this Act, by virtue of his office would be disentitled altogether from applying for permission to use any land of the municipality.
If this were the correct position then there was no point in limiting the disqualification contemplated in section 38(1) (b) (i) to cases where the councillor acts as a councillor.
The words "acts as a councillor" cannot be treated as redundant.
In our view the councillor acts as a councillor within the 'meaning of section 38(1)(b) when he performs any of the functions which under the Act he is required to perform.
An allegation of misuse of his position against a councillor would not at tract the disability under section 38(1) (b)(i) unless it was shown furher that he has acted as a councillor in the matter.
In view of the clear provision of section 38(1)(b)(i) we do not find it possible to support the im pugned judgment.
The appeal is therefore allowed and the judgment of the High Court reversing the decision of the State Government is set aside.
In the circumstances of the case we make no order as to costs.
P.B.R. Appeal allowed.
[/INST]In May 1967 a case was lodged against the respondent and a Major of the Indian Army who was retired in 1966, alleging that the Major, along with the respondent, had committed offences of conspiracy of criminal misconduct by a public servant in dishonestly abusing his position as a public servant, under section 5(2) of the Prevention of Corruption Act, 1947.
When the case, which was allotted to the Fourth Additional Special Court under section 4(.2) of the West Bengal Criminal Law Amendment (Special Courts) Act, 1949, came up for hearing the respondent filed a writ petition challenging its jurisdiction to try the case.
The order of allotment to the Special Court was held illegal by the High Court on the ground that the Special Court had no jurisdiction to try a person who had ceased to be a public servant on the date the Court was required to take cognisance of the offence since it could not be said that in certain respects he was a public servant and in certain others he was not.
It was contended on behalf of the respondent that (1) since the case involved interpretation of article 14 of the Constitu tion it should be referred to a larger Bench in view of Art 144(A) of the Constitution; (2) in view of the definition of public servant contained in section 21 IPC, a public servant is one who is in office and not one who has ceased to be in office; (3) in view of section 10 of the Bengal Act the Special Court had no jurisdiction to try the offence; and (4) the respondent, not being a public servant, is outside the provisions of the Bengal Act and the Prevention of Corrup tion Act.
Allowing the appeal.
HELD: (1) There is no substance in the contention that the appeal should be referred to a larger Bench.
The plea of applicability of article 14 on the basis of the judgment in S.A. Venkataraman vs The State is wholly misconceived.
[764 G] (a) In view of the decision in Venkataraman 's case there is no warrant for including in one category public servants in office and public servants who have ceased to be so.
These two classes of public servants are not similarly situated as has been clearly pointed out in C.R. Bansi vs State of Maharashtra [19711 3 S.C.R. 236.
[764 E] (b) It cannot be argued that the decision in Venkatara man 's case is violative of article 14 of the Constitution.
That decision only says that section 6 of the Act is not applica ble to a public servant if at the time of taking cognizance by the Court he ceases to be so.
Because a particular section is not applicable to a public servant after he has ceased to be in office, the question of the Act being violative of article 14 will not arise.
This Court has clearly placed a public servant, who has ceased to be in office, in a separate category and the classification has held the field all these years without demur.
[764 F G] (c) The proviso to section 4(1) of the Bengal Act cannot attract article 14.
By this proviso the Special Court, when trying a schedule offence finds that some other offence has also been committed, and the trial of the same in one trial is permissible under the Cr.
P.C., it may try such a charge.
Under section 4(1) of the Bengal Act a scheduled offence which includes an offence under section 5(2) of 759 the Prevention of Corruption Act as also conspiracy to commit that offence shall be triable by Special Courts only.
No other court can try those offences.
[764 H, 765 B C] The State of West Bengal vs Anwar Ali Sarkar [1952] S.C.R. 284 held inapplicable.
(2) Section 21 IPC does not afford a true test in deter mining the present controversy.
The crucial date for the purpose of attracting the provisions of the Act as well as those of the Bengal Act is whether the offence had been committed by a public servant within the definition of section 21 IPC.
The date for determining the offence is the date of the commission of the offence when the person arraigned must be a public servant.
Section 6 makes a clear distinction between cognizance of an offence and alleged commission of an offence.
The date of sanction is necessarily subse quent to the date of commission of the offence and some times far remote from that date.
Retirement, resignation, dismissal or removal of a public servant would not wipe out the offence which he had committed while in service.
Under section 6(1), as in the case of section 190(1) Cr.
P.C., the Court takes cognizance of an offence and not an offender.
[765 E G] Raghuban Dubey vs State of Bihar ; referred to.
(3) Section 10 of the Bengal Act which provides that the provisions of the Prevention of Corruption Act shall apply to trials under the Bengal Act are clearly attracted.
Section 6 is interpreted by this Court not to apply to a public servant who has ceased to be in office.
That would not affect the interpretation of section 10 of the Bengal Act.
[766 A B] (4) There is no merit in the submission that the special Court cannot try the offence under section 5(2) of the Act read with section 120B IPC against the respondent.
Even under the Prevention of Corruption Act, an outsider can be prosecuted under section 5(3) of the Act when a person habitually commits an offence punishable under section 165A, IPC.
Section 165A which provides that "whoever abets an offence punishable under section 161 or section 165, whether or not that offence is committed in consequence of the abetment, shall punished . is clearly "applicable to an outsider who may abet a public servant.
Item 8 of the Schedule to the Bengal Act mentions any conspiracy to commit or any attempt to commit or any abetment of any of the offences specified in items 1, 2. 3 and 7.
It is clear that under item 8 of the Schedule an outsider can be tried alongwith a public servant if the former abets or commits an offence of conspiracy to commit an offence under section 5 of the Prevention of Corruption Act which is mentioned in item 7 to the Sched ule.
[766 C E]
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<s>[INST] Summarize the judgementAppeal No. 2296 of 1970.
On appeal by Certificate from the Judgment and Decree dated 17th August, 1963 of the High Court of Patna from Original Decree No 248 of 1955 D. Goburdhan for the Appellant J.
P. Goyal and R. A. Gupta for the Respondents The Judgment of the Court was delivered by VENKATARAMIAH, J.
This appeal by certificate under Article 133 (1) (a) of the Constitution arises out of an action in tort for damages 531 for trespass and unauthorised interference by the defendants with the A proprietary interest of the plaintiff.
The defendants were the State of Bihar and J.P. Mukherjee, an officer in the service of the Bihar Government.
The plaintiff, Prithwi Chand Lall Choudhary was the karta of a Hindu joint family which owned extensive properties collectively known as the "Raj Nazarganj".
The said properties were spread over the District of Purnea and some other districts in the State of Bihar as also in the State of West Bengal.
The plaintiff was the recorded proprietor of several tauzis situated in the Districts of Purnea and Monghyr and also the proprietor of several tenures and patnis within the said Districts.
The plaintiff was liable to pay about Rs. 2,50,000 by way of taxes, cesses etc.
annually.
In the year 1949, the Bihar Legislature passed a law known as the Bihar State Management of Estates and Tenures Act, 1949 (Bihar Act XXI of 1949) (hereinafter referred to as 'the Act ') to provide for the management of estates and tenures in the Province of Bihar.
It received the assent of the Governor General on September 29, 1949 and was published in the Bihar Gazette Extraordinary of October 17, 1919.
On the coming into force of the Constitution of January 26, 1950, the Act was certified by the President in exercise of his powers conferred by Article 31 (6) of the Constitution.
The said certificate which was published in Notification No. 43/3/50 Judicial dated March 11, 1950 read as follows: "that the said Act shall not be called in question in any court on the ground that it contravenes the provisions of clause (2) of Article 31, or has contravened the provisions of sub section (2) of section 299 of the Government of India Act, 1935.
" Clauses (2) and (6) of Article 31 which are relevant for these cases as they stood at the commencement of the Constitution read as follows: "31. (1) (2) No property, moveable or immovable, including any interest in, or in any company owning, any commercial or industrial undertaking, shall be taken possession of or 532 acquired for public purposes under any law authorising the taking of such possession or such acquisition, unless the law provides for compensation for the property taken possession of or acquired and either fixes the amount of the compensation, or specifies the principles on which, and the manner in which, the compensation is to be determined and given. . . . . . (6) Any law of the State enacted not more than eighteen months before the commencement of this Constitution may within three months from such commencement be submitted to the President for his certification; and thereupon, if the President by public notification so certifies, it shall not be called in question in any court on the ground that it contravenes the provisions of clause (2) of this article or has contravened the provisions of sub section (2) of section 299 of the Government of India Act, 1935.
" A persual of the provisions of the Act shows that it was intended to bring about a reform in the land distribution system of Bihar for the general benefit of the community.
l`he taking over of the management and control over land was found to be necessary as a preliminary step towards the implementation of the Directive Principles of State Policy.
The Act was similar in nature to the Bihar Land Reforms Act (Act XXX of 1950), the constitutional validity of which was considered by this Court in The State of Bihar v Maharajadhiraja Sir Kameshwar Singh of Darbanga Ors (1) The object of the Act was to bring the Government face to face with the cultivators of the soil in order to facilitate the further reform of abolition of zamindari.
It was also intended to make provision for better irrigation facilities and to prevent realisation of excessive rent or revenue from the cultivators.
The Statement of Objects and Reasons of the Act published in the Bihar Gazette said: "For some years past there has been wide spread anti zamindari agitation amongst the cultivators of the province leading to frequent agrarian troubles.
These troubles, as is well known, owe their origin to the feeling of dissatisfaction that the tenants have against the landlords owing to the (1) 533 latter 's failure to provide for the upkeep of irrigational facilities, to the realisation of abwab, to the enhancement of rents and to ejectment from holdings and other similar causes.
The landlord 's apathy towards the upkeep of the irrigational facilities has been considerably accentuated recently on account of the large scale commutation of rents in kind into cash rents.
In the interest of all concerned and particularly in order to further the programme of Grow More Food, it has become necessary to assume the management by Government of estates and tenures.
Hence this Bill.
It is proposed under Government management to make adequate arrangements for saving the cultivators from the harassment to which they are often subjected at present by the amlas of the zamindars, to save them from the ruinous financial drain of litigation for the recovery of arrears of rents and above all to benefit them by providing for irrigation facilities.
After making payment for objects specified in the Bill and reserving a reasonable balance for cost of management, the net surplus will be paid over to the proprietors.
" Section 3 to 5 c f the Act were in Chapter 11 of the Act.
Section 3 provided as follows : "3.
(1) The Provincial Government may, by notification declare that the estates or tenures of a proprietor or tenure holder, specified in the notification, shall be placed under the management of the Provincial Government, and on the publication of the said notification, the estates or tenures of such proprietor or tenure holder shall, so long as the notification remains in force, be deemed to have been placed under the management of the Provincial Government with effect from the date of the commencement of management.
(2) The notification under sub section (1) shall (a) specify such particulars of the estates or tenures as may be prescribed; (b) specify the period for which the estates or tenures shall be placed under the management of the Provincial Government; and 534 (c) vest the management of such estates or tenures in a person who shall be an officer not below the rank of Deputy Collector (hereinafter called the Manager) (3) The notification under sub section (1) shall be published in the Official Gazette and a copy of such notification shall be sent by registered post, with an acknowledgment due, to the proprietor of the estates recorded in the general registers of revenue paying or revenue free lands maintained under the Land Registration Act, 1876, or in case such estates are not recorded in any such registers, and in the case of tenure holders, to the proprietor or tenure holder of the estates or tenures, as the case may be, if the Collector of the district is in possession of a list of Such proprietors or tenure holders together with their addresses (4) The publication and posting of such notification, where such notification is sent by post, in the manner provided in sub section (3), shall be conclusive evidence of the notice of the declaration to the proprietor or tenure holder whose estates or tenures are affected by the notification under sub section (1) and of the service of such notice on the proprietor or tenure holder 7 ' Section 4 of the Act laid down the consequences of the issue of a notification in respect of any estate or tenure.
It provided inter alia that (a) the proprietor or tenure holder shall cease to have any power of management of his estates or tenures and (b) subject to the provisions of sections 7, 8, 9, 10.
11 and 12, the Manager shall take charge of such estates or tenures together with such buildings, papers and other properties appertaining to the estates or tenures, as in the opinion of the Manager are essential for the proper management of the estates or tenures.
Section 5 of the Act read as follows: "5.
The Manager may, by a written order, require the proprietor or tenure holder or his agents and employees on a date to be specified in such order to produce before him such documents, papers or registers relating to the estates or tenures of such proprietor or tenure holder or to furnish him with such information as the Manager may deem necessary for the management of the estates or tenures: 535 Provided that the proprietor or tenure holder shall have A the option to comply with such written order either himself or through authorised agent." Chapter III of the Act contained the special provisions regarding trust estates or tenures, homesteads and lands used for agricultural and horticultural purposes and certain buildings comprised in estates or tenures placed under the management of the Provincial Government.
Chapter IV of the Act authorised the removal of mortgagees and lessees in possession of an estate or tenure.
Chapter V contained provisions regarding the filing of claims by secured creditors and other persons in possession of the estate or tenure, determination of liabilities and preparation of scheme for their liquidation.
Chapter VI of the Act provided for the filing of claims by creditors other than secured creditors.
Chapter VII made provisions for granting protection from sale of certain estates.
Chapter VIII of the Act contained detailed provisions regarding the management of the estates by the Manager.
Section 22 of the Act which was in Chapter VIII provided that 'every Manager shall manage the property committed to him diligently and faithfully and shall, in every respect, act to the best of his judgment '.
Chapter IX of the Act provided for an appeal to the order of prescribed authority against the Manager.
Chapter X made provision for the constitution of Estates and Tenures Management Advisory Committee and their functions.
Sections 30 and 31 of the Act which were in Chapter XI of the Act barred the jurisdiction of courts regarding matters referred to therein.
They read as under: "30.
Notwithstanding anything contained in any law or anything having the force of law, the declaration of the Provincial Government under sub section (1) of section 3 and the order of the Manager under sub section (1) of section 13 or where on appeal has been preferred, the order of the appellate authority under section 27, shall, subject to the provisions of this Act, be final and shall not be questioned in any Court; and so long as the management of the estates and tenures by the Provincial Government continues, it shall not be lawful for any court to pass any order or do anything which may in any way interfere or have the effect of interfering with such management by the Provincial Government.
No suit or other legal proceeding shall lie in any court against the Crown or any servant of the Crown or 536 against any person acting under the orders of a servant of the Crown for, or on account of, or in respect of, anything done or purporting to be done in good faith under this Act or in respect of any alleged neglect or omission to perform any duty devolving on the Provincial Government or any of the officers subordinate to it and acting under this Act or in respect of the exercise of, or the failure to exercise, any power conferred by this Act, on the Provincial Government or any officer subordinate to it and acting under this Act, except for the loss or the misapplication occasioned by the wilful default or gross negligence of any officer of the Provincial Government." Chapter XII of the Act contained some miscellaneous provisions regarding suits and appeals by or against the proprietor or tenure holder during the period of management by the Government.
Section 33 in Chapter XIII of the Act provided for relinquishment of management of an estate taken over by the Government and other consequential matters.
The other parts of the Act contained provisions regarding other miscellaneous matters.
By a notification dated November 19, 1949 issued under section 3 (1) of the Act the estate of the plaintiff i.e. the 'Raj Nazarganj Estate ' was taken under the management of the State Government.
J P Mukherjee, defendant No. 2, who was the Additional Collector of Darbhanga, was appointed as the Manager of the said estate.
In the meanwhile the Maharajadhiraja of Darbhanga, Sir Kameshwar Singh filed a suit in the Civil Court challenging the validity of the Act as his estate also had been similarly notified under section 3 (1) of the Act.
That suit was withdrawn by the Patna High Court being tried in its Extraordinary Original Civil Jurisdiction.
That suit was decided on June 5, 1950.
The judgment of the High Court in that suit is reported as M.D. Sir Kameshwar Singh vs State of Bihar.(1) By that judgment the Patna High Court declared that the Act was ultra vires and wholly void and an injunction was issued restraining the State Government from enforcing the Act.
Against that judgment, the State of Bihar preferred an appeal before this Court.
But the plaintiff in the case before us, however, on the basis of the judgment of the High Court demanded on June 9, 1950 that he should be put back in possession of the estate whose management had been taken over from him.
On July 3, 1950 the then Collector by his letter informed the plaintiff (1) I.L.R. '29 Patna 790.
537 that the Government had decided to relinquish charge of the estates A and tenures of the plaintiff and that the plaintiff should cooperate in taking over charge by July 15, 1950.
On July 6, 1950 the Government had already cancelled the notification s issued under section 3 (1) of the Act.
The charge of collection papers was handed by the middle of July, 1950.
The abstracts and synopsis of accounts were given on August 7, 1950.
About Rs. 1, 46,00" had been collected on behalf of the estate during the Government 's management.
After the estate was thus handed over to him, the plaintiff filed a suit on September 21, 1951 in the court of the Subordinate Judge, Purnea for damages of Rs. 2,00,000 for wrongful and illegal interference with the plaintiff 's estates and tenures and for other consequential reliefs.
The plaint proceeded on the basis that the Act was unconstitutional as declared by the High Court earlier and that taking over of the possession and management of the estate etc.
was illegal.
The plaintiff pleaded that the Act having been declared void, the defendants were liable for not only the amount of loss actually suffered by the plaintiff but were also liable to recoup the amount spent by them during their management of the estate which was wrongful.
It was alleged that the action of the defendants suffered from negligence, bad faith and malice.
The plaint claimed that the defendants were liable jointly and severally as tort feasors for all such losses suffered by him.
In paragraph 27 of the plaint the plaintiff set out broadly the grounds of his claim thus: (a) that due to gross negligence and wilful default the defendants contravened the provisions of section 3 (1) in notifying and taking possession of part only of plaintiff interests in Estates and Tenures and in omitting to notify other parts of his Estates and Tenures on the first occasion when the notification dated November 19, 1949 was issued the Government was unable to realise all the rents and other dues, (b) that due to wrong notification and omission to notify all parts of his Estates and Tenures and also on account of amalgamated rentals maintained by the plaintiff in respect of his estates and tenures, the plaintiff could not fully realise the balance share of unnotified estates and tenures, (c) that certain rents and decrees had been allowed to become barred by time and (d) that on account of non payment of Agricultural Income Tax and consequent imposition of penalty which was no doubt reduced to Rs. 2,000 on appeal the Estate suffered a loss of Rs. 2,000 He also pleaded that on account of the issue of wrong collection certificates by defendant No. 2 and his staff the plaintiff had suffered some loss which was yet to be ascertained.
538 In the written statement the defendants traversed all the material allegations in the plaint.
They pleaded inter alia that the notification was issued in November, 1949 on the basis of the requisition of the Collector, P.K.J. Menon and that defendant No. 2 was appointed as Manager by that notification.
The allegations of negligence, bad faith and malice were denied.
The defendants pleaded that on the basis of information available in the records of the Government the notification was issued in November, 1949 and at the request of the plaintiff after verification second notification was issued on March 16, 1950, and that plaintiff requested for the issue of the second notification in order to escape the processes of law which had been taken out against him by his creditors and to shield his entire properties from the creditors.
In fact the Government appointed the very collecting agents who were working under the plaintiff and after the management was handed back he reappointed them as his collecting agents.
The plaintiff had accepted without protest the final accounts which had been prepared at the end of the period of management.
Tauzis Nos. 7/8, 30 and 38 about which there was some dispute remained all along with the plaintiff and the collection papers pertaining to them were made over to defendant No. 2 only in the latter part of April, 1950 and if no collection could be made prior thereto in the said area till then the defendants could not be blamed.
The defendants pleaded that they had bona fide carried out their duties.
One fact which requires to be noted here is that the plaint did not have any reference to the effect of section 31 of the Act which is set out above, but it proceeded on the basis that the Act was unconstitutional.
At the conclusion of the trial, the trial court held that the cost of management incurred by defendant No 2 over and above 12.1/2% of gross collection was excessive and the dependents should refund such excess amount.
Secondly, it held that the mistake in not notifying all the shares held by the plaintiff in Tauzis Nos. 718 and 3 at the first instance resulted in non collection of the dues and the plaintiff thereby had suffered.
The trial court held that the defendants being trespassers, the plaintiff owed no duty to them to make available to them the separated Jamabandi to facilitate collection of dues in the said Tauzis.
The trial court, therefore, held that the defendants should reimburse the plaintiff the amount he would have been able to collect from those tauzis during the period of their management.
Similarly, the defendants were liable to make good the loss caused on account of arrears or decrees which had been allowed to become barred.
The trial court directed that a commissioner should enquire into the above items.
Accordingly a preliminary decree was passed.
539 Against the said preliminary decree the defendants filed an appeal before the High Court.
When the appeal came up before a Division bench of the High Court, the defendants contended that the decision of the High Court in which the Act had been declared as unconstitutional required to be reconsidered by the High Court in view of some later decisions of this Court.
Accordingly the Division Bench referred the case to a larger Bench on July 14, 1962.
The case was then heard by a Full Bench of five learned Judges of the Patna High Court.
By its judgment dated February 15, 1963 the Full Bench overruled the earlier decision in MD.
Sir Kameshwar Singh vs State of Bihar (supra) and declared that the Act was constitutional.
The appeal was then referred back to the Division Bench for disposal in accordance with the opinion of the Full Bench.
The Division Bench which finally heard the appeal was of the view that though it was open to the State to notify only a fraction of an estate under section 3 (1) of the Act yet the defendants were not absolved from the duty of taking appropriate steps for the preparation of suitable collection papers in respect of the notified shares in Tauzis Nos. 718 and 300.
It held that the defendants were liable to compensate the plaintiff for not preparing the collection papers in time.
The Division Bench further held that even though the plaintiff had been told to file suits for rents in respect of unnotified share of the estate, the defendants were negligent in the matter of issuing certificates for recovery, some Of which were later on struck off.
The Division Bench also held that the material on the record did not indicate that necessary steps were taken by defendant No. 2 with regard to pending suits and execution proceedings and there was every 17 probability that loss had been suffered by the plaintiff on account of the inaction or failure to continue pending proceedings which amounted to wilful default and gross negligence.
The Division Bench agreed with the trial court that the defendants were liable to reimburse the plaintiff to the extent of Rs. 2,000 levied as penalty for non payment of Agricultural Income Tax.
In so far as the cost of management of Rs. 43,507 which was in the order of 30 per cent of the gross collection was concerned while the trial court had allowed 12.112 per cent, the Division Bench allowed 25 per cent of the gross collection.
In other words the Division bench found that about Rs. 8,000 had been incurred as cost of management in excess of what was authorised.
The Division Bench found that the plaintiff was entitled to it.
The Division Bench held that section 31 of the Act did not give protection in respect of loss which was caused by wilful 540 default and gross negligence.
The appeal of the defendants was accordingly dismissed.
The cross objections of the plaintiff regarding certain matters disallowed by the trial court were also dismissed Aggrieved by the decree passed by the High Court, the State of Bihar applied for a certificate under Article 133 (1) (a) of the Constitution in S.C.A. No. 137/63 on the file of the High Court to file an appeal before this Court.
On the HIGH Court granting the certificate accordingly on December 10,1961, the State of Bihar has filed the above appeal.
The plaintiff also applied for a similar certificate in S.C.A No. 1/64 on the file of the High Court to file an appeal against the decree in so far as it had gone against him.
The High Court granted in his case also a similar certificate by She same order on December 10,1964 but the said certificate was later on cancelled by the High Court on July 6, 1965.
Thus the said proceedings came to an end.
We are now concerned with only the appeal field by the State of Bihar.
In this appeal, the constitutionality of the Act is not questioned before us.
On going through the record of the case, we find that the following facts are established.
The notification issued on November 19,1949 under section 3 (1) of the Act referred to the name of the proprietor, the name of the estate, tauzi numbers of the estate and the share of the proprietor in the tauzis.
Defendant No. 2, J.P. Mukherjee who was then the Additional Collector of Purnea was appointed as the Manager of the estate.
On December 14, 1949, the plaintiff was informed by the Collector at Purnea that the management of the estate was to commence from December 30, 1949 and that he should produce before the Manager a list of villages included in the estate and also the Jamabandis, Karchas and Wasil Baukis upto date before December 27,1949 and also to make over a complete and clear list of the papers showing Jamabandis of each village, the arrears collected and the arrears outstanding before the commencement of the management under the Act.
He was requested to cooperate in the matter and was also informed that if he did not do so the responsibility for any loss would be his.
On December 27, 1949 the plaintiff wrote a letter to the Collectorate.
In that he stated that the work of handing over papers properly of a big and complicated estate was not an easy task and it would certainly take a considerable number of days to complete it.
He pointed out that the Government had committed an error in taking over the management of only 2A 11A 2C 2K 541 share out of Tauzi No 7/8 under the notification, because the collection papers had been maintained for 5 12. 1 /2 and odd share in respect said of the said tauzi.
He pleaded that unless the whole of 5 12.1/2 share was notified, the work of separation of the notified share from the notified share could not be completed even within a period of six months.
He, therefore, asked for the modification of the notification.
Then we find that the plaintiff had met the Collector many times when the affairs of the estate were discussed.
On March I 1,195 ', the Collector wrote the following letter to the plaintiff: "District Office, Purnea The 11th March.
1950 My dear Raja Saheb, 1.
With reference to our discussions on the 7th March.
1950, the following action may be taken with regard to the notified and unnotified portions of your estate as agreed to between us.
We will not be taking over the unnotified portion until the notification is made.
As soon as a notification is made we will take over these portions.
Meanwhile in order to see that no limitation occurs with regard to any rent payable to you, you are requested to prepare a copy of arrear list for the unnotified portions.
With regard to Tauzi No. 7, sufficient number of Tahsildars and other staff required may be employed after selection on the 14th of March, 1950, at Kishanganj, by the Additional Collector and by your Circle Officer.
A certain number of these, according to the proportion that is notified will be selected by the Additional Collector and paid by Government.
You are requested to employ a certain number according to the proportion of the unnotified interest.
These staff together may be put on the job of preparing the arrear list.
If notification is made before the Tamadi Day, we will arrange to issue certificates in respect of arrears due.
however, notification for some reason or other is not made, 542 then we will arrange to file joint suits for these arrears before the Tamds Day.
Yours sincerely, sd/ (Illeg ) 13/3 Raja P.C. Lal Choudhuri, C.B.E. Nazarganj Palace, Purnea City. " A supplementary notification was issued on March 16, 1950 as desired by the plaintiff.
Then we find that there is some further discussion and correspondence between the plaintiff and the Manager.
On April 7,1950, the Manager wrote to the plaintiff that he had been able to persuade the Government to advance Rs. 35,000 to meet the expenses of suits to be field for recovery of rents due to the estate.
The plaintiff replied to that letter on the same date appreciating the step taken by the Government in advancing Rs. 35,000 as loan to the estate.
On April 14,1950, the Manager sent a telegram to the plaintiff stating that since he had not cooperated in sending the previous records of cases in time in respect of Tauzi No. 7/8, it was not possible to file joint suits in respect of both the notified share and the unnotified share and that he was responsible for filing Tamadi suits in respect of the unnotified share in Tauzi No. 718.
The defendant No. 2 in his evidence has stated that he could not make any collection in Tauzis Nos. 7/8 and 30 prior to the second notification because the collection papers were with the plaintiff and they were actually received by him on April 24,.1950.
In the lengthy cross examination of defendant No. 2 we do not find any material which would discredit his evidence or which would show that he had either acted in excess of his powers or mala fide.
We also find that a large number of suits had been filed for recovery of the arrears due to the estate and merely because some of the suits were dismissed on merits or on the ground that some of the persons sued were dead or not traceable, it cannot be said that there was lack of bona fides on the part of the Manager.
By the middle of July, 1950, the management of the estate itself was relinquished.
From the foregoing, we find that it could not be said that there was want of good faith on the part of either the Government or defendant No. 2 who was the Manager.
If a certain share in a tauzi had not been notified on the first occasion it again cannot be said as having been done either mala fide or deliberately to harm the plaintiff.
We shall now deal with the specific findings recorded by the Division Bench of the High Court.
543 The first ground on which the Division Bench has held that the A defendants were liable to pay damages is that defendant No. 2 had failed to get the collection papers prepared in respect of Tauzis Nos. 7/8 and 30 in time and thus caused loss to the plaintiff.
it may be stated here that the Division Bench accepted and we think rightly in view of the definition of the expression 'tenure ' in section 5 of the Act that it was open to the Government to notify even a fraction of a tenure under section 3 (1) of the Act It, however, omitted to notice that the plaintiff had failed to discharge his duty imposed on him under section 5 of the Act which provided that the Manager could by a written order require the proprietor or tenure holder or his agents and employees on a date to be specified in such order to produce before him such documents or papers or registers relating to the estate or tenure concerned or to furnish him with such information as he may deem necessary for the management of the estate or tenure.
In the present case defendant No. 2 did call upon the plaintiff to submit the documents from which it was possible to find out the ability of persons in respect of the notified share in Tauzis Nos. 718 and 30.
The plaintiff pleaded that he had not maintained such separate set of ' accounts and that it would take a long time to prepare it.
He, how ever, produced the registers by the end of April, 1950 only, after the remaining shares were also notified.
Hence if the collection papers were not prepared till then by defendant No 2 in time it was not on account of any negligence on the part of defendant No. 2.
On the other hand he recommended that the unnotified share also should be notified as desired by the plaintiff and such notification was also issued.
By the time steps could be taken to prepare the collections papers the Act had been struck down by the High Court.
Then steps were taken to hand over the estate back to the plaintiff.
It is difficult to agree with the High Court that there was any wilful default or gross negligence on the part of defendant No. 2 in this regard.
With regard to the charge that defendant No. 2 had filed a large number of certificate cases, some of which were later on struck off, the observation of the High Court itself supports that there was no negligence on the part of defendant No. 2 but on the other hand the plaintiff was responsible for it.
The High Court has observed thus: "It appears that it was on the basis of some arrears list submitted by the plaintiff of defendant No. 2 and without subjecting it to proper scrutiny, that a large number of certificate cases were hurriedly filed by the defendants at the time of the Tamadi in the middle of April 1950, and, it was.
544 therefore, not strange that quite a large number of them had subsequently to be struck off, with the result that a considerable portion of the arrears of rents and profits of the plaintiff 's estate remained unrealised and became time barred.
It is manifest that the loss caused to the plaintiff 's estate on this account was due to the inaction of defendant No. 2 amounting to wilful default and gross negligence on his part.
The responsibility for such loss must undoubtedly lie with the defendants." (underlining by us) The High Court omitted to notice that the certificate cases had been filed though hurriedly on the basis of the arrears list submitted by the plaintiff, himself.
In the circumstances it is difficult to charge defendant No. 2 with wilful default or gross negligence on a complaint by the plaintiff.
Further the High Court did not refer in the course of its judgment at least to a few such cases which showed that there was gross negligence.
The High Court overlooked that nearly 7,000 certificate cases had to he filed in a short period.
On the material before us we are not satisfied that the above ground has been made out against the defendants.
The third ground that defendant No. 2 had not diligently attended to any pending proceeding is also not made out since no specific case is dealt with by the High Court which prima facie established that charge.
With regard to the penalty of Rs. 2,000 imposed for non payment of the Agricultural Income Tax it is seen that a penalty of Rs. 5,000 was first imposed as the plaintiff was unable to pay the Agricultural Income Tax in time because he could not collect arrears in time.
In fact on the intervention of the Collector it was reduced to Rs. 2,000.
Even then it was too remote to the management of the notified estate by defendant No. 2.
The trial court had held that it was due to the issue of a wrong notification at the first instance.
But when once it is conceded that the first notification was not an unauthorised one the defendants could not be held liable for reimbursing the penalty of Rs 2,000 paid by the plaintiff.
In so far as the cost of management is concerned, the dispute is confined to about Rs. 8000.
It is seen that the estate had to be returned prematurely to the plaintiff Owing to the judgment of the High 545 Court declaring the Act as unconstitutional within a period of about seven months.
But since defendant No. 2 had offered to refund any expenditure incurred in excess of 25% of the gross collections to the plaintiff, defendant No. I has to pay back Rs. 8,000 to the plaintiff.
It is seen that in present case while the trial court proceeded on the basis that the Act was unconstitutional that the defendants were trespassers on the plaintiff 's estate and that the plaintiff owed no duty to them, the Division Bench of the High Court which finally disposed of the appeal failed to give due attention to section 31 of the Act which had been held to be constitutional earlier.
Section 31 of the Act provided that no suit or other legal proceeding would lie in any court against the State Government or against any servant of the State Government or against any person acting under the orders of a servant of the State Government for or on account of or in respect of anything done or purporting to he done in good faith under the Act or in respect of any alleged neglect or omission to perform any duty devolving on the State Government or any of the officers subordinate to it or acting under the Act or in respect of the exercise of or on failure to exercise any power conferred by the Act on the State Government or any officer subordinate to it and acting under the Act, except for the loss or the misapplication occasioned by the wilful default or gross negligence of any officer of the State Government.
Under section 4 (22) of the Bihar and Orissa General Clauses Act, 1917, a thing shall be deemed to be done in 'good faith ' where it is in fact done honestly, whether it is done negligently or not.
There is no ground to hold that either the State Government or any of the officers acting under it in performance of their duties under the Act had not acted honestly either in issuing the notification under section 3 (l) of the Act on November 19,1949 by which only parts of Tauzis No. 7/8 and 30 had been notified or in not preparing separate collection statements before April, 1950.
the mistake appears to have occurred because the plaintiff himself had acquired the said Tauzis in installments.
Further as soon as the error was pointed out steps were taken by defendant No. 2 to get the unnotified share also notified and the Government issued a notification accordingly within about four months.
It is b cause the plaintiff did not hand over even the consolidated collection statements by April, l950, the separate collection statements could not be got prepared by defendant No. 2 by April, 1950 and even according to the plaintiff himself it would have taken six months to prepare separate collection statements on the basis of the consolidated statements.
It is not shown that either the State Government or any of its officers knew before hand that the plaintiff 546 had maintained a consolidated statement of accounts and that deliberately in order to cause loss to the plaintiff the first notification had been issued in respect of a portion of Tauzis Nos. 7/8 and 30.
These facts constituted a good defence under Section 31 of the Act against any claim based on any alleged neglect or omission since there was no proof of any wilful default or gross negligence on the part of the defendants.
There was also no proof of deliberate abuse of statutory power nor of usurpation of a power which the authorities knew that they did not possess.
In the circumstances the claim for damages on all counts should fail except with regard to the claim for Rs. 8,000 which had been incurred as cost of management in excess of what was authorised by law.
For the foregoing reasons, we set aside the judgment and decree by the trial court and the judgment and decree dated August 17, 1963 passed by the Division Bench of the High Court and pass a decree against defendant No. 1, the State of Bihar directing it to pay the plaintiff 's legal representatives a sum of Rs. 8,000/ with interest thereon at 6 per cent per annum from the date of suit i.e. September 21, 1951 till the date of payment.
The rest of the claim in the suit is dismissed.
Parties shall bear their own costs in all the courts.
The appeal is accordingly allowed in part.
S.R. Appeal allowed.
[/INST]By a Notification dated November 19, 1949 issued under section 3(1) of the Bihar State Management of Estates and Tenures Act, 1949 (Bihar Act XXI of 1949), as duly certified by the President under clause (6) of Article 31 of the Constitution, the estate of the Prithwi Chand Lall Choudhary called "Raj Nazarganj" spread over the District of Purnea and some other districts in the State of Bihar as also in the State of West Bengal, was taken under the management of the Bihar State Government.
One J.P. Mukherjee who was the Additional Collector of Darbhanga was appointed as the Manager of the estate.
In the meanwhile, the Maharajadhiraja of Darbhanga Sir Kameshwar Singh filed a civil suit challenging the validity of the Act as his estate was also similarly notified under the said section.
The Patna High Court withdrew that Suit to its own file for being tried in its Extra ordinary Original Civil Jurisdiction and by its judgment dated June 5, 1950 reported as M D. Sir Kameshwar Singh V. State of Bihar ILR 29 Patna 790, declaring the Act to be ultra vires and wholly void, issued an injunction restraining the State Government from enforcing the Act.
Against that judgment the State of Bihar preferred an appeal to the Supreme Court.
However, on the basis of the judgment of the High Court, Prithwi Chand Lall Choudhary demanded on June 9, 1950 that he should be put back in possession of the estate whose management had been taken over from him.
On July 3, 1950 the then Collector by his letter informed Choudhary that the Government had decided to relinquish charge of the estates and tenures and that Choudhary should co operate in taking over charge by July 15, 1950.
On July 6, 1950 the Government cancelled the Notification issued under section 3(1) of the Act.
The charge of collection papers was handed over by the middle of July, 1950 to Choudhary.
The abstracts and synopsis of accounts were given on August 7, 1950.
About Rs. 1,46,000/had been collected on behalf of the estate during the Government 's management.
After the estate was thus handed over to him, Choudhary filed a suit on September 21, 1951 in the Court of the Subordinate Judge, Purnea, for damages of Rs. 2,00,000 for wrongful and illegal interference with his estates and tenures and for other consequential reliefs, 528 Broadly the grounds of the claim were (a) that due to gross negligence ., and wilful default the appellant herein, contravened the provisions of section 'S 3(1) in notifying and taking possession of part only of Choudhary 's interest in Estates and Tenures and in omitting to notify other parts of his Estates and Tenures on the first occasion when the Notification dated November 19, 1949 was issued the Government was unable to realise all the rents and other dues, (b) that due to wrong Notification and omission to notify all parts of his Estates and Tenures and also on account of amalgamated rentals maintained by the Respondent in respect of his estates and tenures he could not fully realies the balance share of unnotified estates and tenures, (c) that certain rents and decress had been allowed to become barred by time, (d) that on account of non payment of Agricultural Income Tax and consequent imposition of penalty which was no doubt reduced to Rs. 2,000 on appeal the Estate suffered a loss of Rs. 12,000 and, (e) that on account of issue of wrong collection certificates by Collector and his staff the respondent had suffered some loss which was yet to be ascertained.
It was alleged that the action of the appellant suffered from negligence, bad faith and malice and the appellant alongwith its Manager as tortfeasor was jointly and severally for all such losses suffered by him.
The appellant traversed all the material allegations in the plaint and the plea was one of bona fides carrying out of their duties under the Act.
The Trial Court which proceeded on the basis that the Act was unconstitutional, and the appellant was a trespasser on the respondents ' estate held: (1) that the cost of management incurred by the Collector over and above 12 1/2% of the gross collection was excessive, and therefore, the State should refund such excess amount; (2) that the mistake in not notifying all the shares held by Choudhary in Tauzis Nos. 7/8 and 30 at the first instance resulted in non collection of the dues and Choudhary thereby had suffered; (3) that the State being trespassers, Choudhary owed no duty to make available to them the separated Jamabandi to facilitate collection of dues in the said Tauzis, and therefore, the State should reimburse Choudhary the amount he would have been able to collect from those tauzis during the period of their management, and also to make good the loss caused on account of arrears or decreaes which had been allowed to become barred.
The Trial Court, accordingly, passed a preliminary decree and directed that a Commissioner should enquire into the above items.
Against the said preliminary decree the State, filed an appeal before the High Court.
At the instance of the State and on a reference by the Division Bench hearing the appeal, a Full Bench of the Court reconsidered the decision reported in ILR 29 Patna 790, by its judgment dated February 15, 1963 overruled the said decision, and declared that the Act was constitutional.
Thereafter the Division Bench finally heard the appeal and took the view that though it was open to the State to notify only a fraction of an estate under section 3(1) of the Act, yet, it was not absolved from the duty of taking appropriate steps for the preparation of suitable collection papers in respect of the notified shares in Tauzis No. 7/8 and 30.
The Division Bench held that the State was liable to compensate Choudhary for not preparing the collection papers in time; (i) that even though Choudhary had been told to file suits for rents in respect of unnotified share of the estate, the State were negligent in the matter of issuing certificates for recovery, some of which were later on struck off; (ii) that the material on 529 the record did not indicate that necessary steps were taken by the Collector with regard to pending suits and execution proceedings and there was every probability that loss had been suffered by Choudhary on account of the inaction or failure to continue pending proceedings which amounted to wilful default and gross negligence; (iii) that the State was liable to reimburse Choudhary to the extent of Rs. 2,000 levied as penalty for non payment of Agricultural Income Tax; (iv) in so far as the cost of management of Rs. 43,507 which was in the order of 30 per cent of the gross collection was concerned about a sum of Rs. 8,000 (=25% of the gross collection) had been incurred as cost of management in excess of what was authorised and that (Choudhary was entitled to it; and (v) that section 31 of the Act did not give protection in respect of loss which was caused by wilful default and gross negligence.
The appeal of the State and the cross objections of Choudhary regarding certain matters disallowed by the trial Court were, accordingly, dismissed.
Hence the State Appeal by certificate.
Allowing the appeal in part, the Court C ^ HELD 1.1 The Bihar State Management of Estates and Tenures Act, 1949 (Bihar Act XXI of 1949) was intended to bring about a reform in the land distribution system of Bihar for the general benefit of the community.
The taking over of the management and control over land was found to be necessary as a preliminary step towards the implementation of the Directive Principles of State Policy.
Therefore, section 31 of the Act provided that no suit or other legal proceeding would lie in any Court against the State Government or against any servant of the state Government or against any person acting under the orders of a servant of the State Government for or on account of or in respect of anything done or purporting to be done in good faith under the Act or in respect of any alleged neglect or omission to perform any duty devolving on the State Government or any of the officers subordinate to it or acting under the Act, or in respect of the exercise of or on failure to exercise any power conferred by the Act on the State Government or any officer subordinate to it and acting under the Act, except for the loss or the misapplication occasioned by the wilful default or gross negligence of any officer of the State Government.
Under section 4(22) of the Bihar and Orissa General Clauses Act, 1917, a thing shall be deemed to be done in 'good faith ' where it is in fact done honestly, whether it is done negligently or not.
[532E; 545C E] 1.2.
In the instant case, there was no proof of deliberate abuse of statutory power nor of usurpation of a power which the authorities knew that they did not possess.
It cannot be said that either the State Government or any of the officers acting under it in performance of their duties under the Act had not acted honestly either in issuing the Notification under section 3(1) of the Act, on November 19, 1949 by which only parts of Tauzis Nos. 7/8 and 30 had been notified or in not preparing separate collection statements before April 1950.
Further, the following facts, namely, (a) the respondent himself had acquired the said Tauzis in instalments; (b) as soon as the error was pointed out steps were taken by the Manager to get the unnotified share also notified and the Government issued a Notification accordingly within about four months; (c) on account of not handing over by the respondent even the consolidated collection statements by April 1950, the separate collection statements could not be got prepared by the Manager 530 By April 1950; (d) even according to the respondent himself if would have taken six months to prepare separate collection statements on the basis of the consolidated statements; and (e) unawareness of the State Government or any of its officers before hand that the respondent had maintained a consolidated statement of accounts on the date of issue of the first Notification in respect of a portion of Tauzis Nos. 718 and 30, constituted a good defence under section 31 of the Act against any claim based on any alleged neglect or omission since there was no proof of any wilful default or gross negligence on the part of the defendants.
[545F H; 546A B] 1.3.
In the instant case; (i) the claim for damages on all counts should fail except with regard to the claim for Rs. 8,000 which had been incurred as cost of management in excess of what was authorised by law.
With regard to the penalty of Rs. 2,000 imposed for non payment of the Agricultural Income Tax when once it was conceded that the first notification was not unauthorised one, the State could not be held liable for reimbursing the penalty of Rs. 2,000 to the respondent; (ii) It cannot be said that the Manager acted in excess of his powers vested under the Act of 1949 or mala fide.
Lack of bona fides cannot be attributed to him merely because some of the suits out of a large number of suits filed for recovery of the arrears due to the Estate, were dismissed on merits or on the ground that some of the persons sued were dead or not traceable.
In fact nearly, 7,000 certificate cases had to be filed in a short period and hurriedly on the basis of arrears list submitted by the respondent himself and by the middle of July 1950 the management of the state itself was relinquished.
Further if a certain share in a tauzi had not been notified on the first occasion it again cannot be said as having been done either mala fide or deliberately to harm the respondent.
The Manager therefore, could not be charged for wilful default or gross negligence in as much as in view of the definition of the expression 'tenure ' in section 2(k) of the, Act it was open to the government to notify even a fraction of a tenure under section 3(1) of the Act; (iii) Since the respondent himself failed to discharge his duty imposed the State cannot be made liable to any damages on the ground that the Manager had failed to get the collection papers prepared in respect of Tauzis Nos. 718 and 30 in time and thus caused loss to the respondent.
[546C; 544G; 542F G; 543A B]
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<s>[INST] Summarize the judgementAppeals Nos. 33 and 34 of 1959.
Appeal by special leave from the order dated May 29,1957, of the Central Government Ministry of Finance, New Delhi in Appeal Cases Nos. 24 and 33 of 1957.
A. V. Viswanatha Sastri and Ganpat Rai, for the appellants.
B. P. Maheshwari, for the respondents.
M. C. Setalvad, Attorney General for India, B. B. L. Iyengar and T. M. Sen, for Union of India.
April 25.
The Judgment of section K. Das, Kapur, Shah and Venkatarama Ayyar, JJ., was delivered by Shah, J. Hidayatullah, J. delivered a separate Judgment.
SHAH, J. M/s.Harinagar Sugar Mills Ltd. is a public limited company incorporated under the Indian Companies Act, 1913 (7 of 1913).
Article 47B of the Articles of Association of the company invests the 44 342 directors of the company with absolute discretion to refuse to register any transfer of shares.
That Article is in the following terms: "The directors may in their absolute discretion and without giving any reason refuse to register any transfer of any shares whether such shares be fully paid or not.
If the directors refuse to register the transfer of any shares, they shall within two months, after the date on which the transfer was lodged with the company, send to the transferees and the transferor notice of the refusal.
" One Banarasi Prasad Jhunjhunwala is the holder of a block of 9500 fully paid up shares of the company.
In January, 1953, he executed transfers in respect of 2500 out of those shares in favour of his son Shyam Sunder and in respect of 2100 shares in favour of his daughter in law Savitadevi and lodged the transfers with the company for registration of the shares in the names of the transferees.
The directors of the company by resolution dated August 1, 1953, in purported exercise of the powers under Article 47B of the Articles of Association, declined to register the shares in the names of the transferees.
Petitions were then filed by Banarasi Prasad and the transferees in the High Court of Judicature at Bombay for orders under section 38 of the Indian Companies Act, 1913 for rectification of the register of the company maintaining that the refusal by the board of directors to register the transfer of the shares was "mala fide, arbitrary and capricious" and that the directors had acted with improper and ulterior motives.
The High Court rejected these petitions holding that in summary proceedings under section 38, controversial questions of law and fact could not be tried and that the proper remedy of the transferees, if so advised, was to file suits for relief in the civil court.
Requests were again made by the transferees to the company by letters dated February 29, 1956 to register the transfers made by Banarasi Prasad in 1953.
The directors of the company in their meeting of March 15, 1956 reiterated their earlier resolution not to register the shares trans ferred in the names of the transferees.
Against this 343 action of the company, appeals were preferred to the Central Government under section 111 el.(3) of the Indian , which had since been brought into operation on April 1, 1956.
K. R. P. Ayyangar, Joint Secretary, Ministry of Finance, who heard the appeals declined to order registration of transfers, because in his view, the questions raised in the appeals could, as suggested by the High Court of Bombay, be decided only in a civil suit.
Thereafter, Banarasi Prasad transferred a block of 100 shares to his son Shyam Sunder and another block of 100 shares to his daughter in law Savitadevi, and the transferees requested the company by letters dated November 21, 1956, to register the transfers.
In the meeting dated January 12, 1957, the directors of the company resolved not to register the transfers and informed the transferees accordingly.
Against this resolution, separate appeals were preferred by Shyam Sunder and Savitadevi under section 111 el.(3) of the Indian to the Central Government.
It was submitted in para 4 of the petitions of appeal that the refusal to register the transfer of shares was without "any reason, arbitrary and untenable".
The company filed representations submitting that the refusal was bona fide and was not "without any reason, arbitrary and untenable" as alleged.
Shyam Sunder and Savitadevi filed rejoinders to the representations submitting that they had never alleged that refusal to transfer the shares "was capricious or mala fide" and that all they had alleged was that the "refusal was without any reason, arbitrary and untenable".
By separate orders dated May 29, 1957, the Deputy Secretary to the Government of India, Ministry of Finance set aside the resolution passed by the board of directors in exercise of the powers conferred by sub sections(5) and (6) of section Ill of the Indian , and directed that the company do register the transfers.
In so directing, the Deputy Secretary gave no reasons.
Against the orders passed by the Deputy Secretary, with special leave under article 136 of the Constitution, these two appeals are preferred by the company.
Two questions fall to be determined in these appeals, (1) whether the Central Government exercising appellate powers under section 111 of the before its amendment by Act 65 of 1960 is a tribunal exercising judicial functions and is subject to the appellate jurisdiction of this court under article 136 of the Constitution, and (2) whether the Central Government acted in excess of its jurisdiction or otherwise acted illegally in directing the company to register the transfer of shares in favour of Shyam Sunder and Savitadevi.
Article 136 of the Constitution, by the first clause provides: "Notwithstanding anything in this Chapter, the Supreme Court may, in its discretion, grant special leave to appeal from any judgment, decree, determination, sentence or order in any cause or matter passed or made by any court or tribunal in the territory of India".
The Central Government exercising powers under section Ill of the is not a court; that is common ground.
The Attorney General intervening on behalf of the Union of India submits that the Central Government merely exercises administrative authority in dealing with an appeal under section 111 of the Indian and is not required to act judicially.
He submits that the authority of the directors of the company which is in terms absolute, and is not required to be exercised judicially, when exercised by the Central Government under section 111 does not become judicial, and subject to appeal to this court.
But the mere fact that the directors of the company are invested with absolute discretion to refuse to register the shares will not make the jurisdiction of the appellate authority administrative.
In a recent case decided by this court Shivji Nathu bhai vs The, Union of India (1), it was held that the Central Government exercising power of review under r. 54 of the Mineral Concession Rules, 1949 against an (1) ; 345 administrative order of the State Government granting a mining lease was subject to the appellate jurisdiction of this court, because the power to review was judicial and not administrative.
In that case, the action of the State Government granting the mining lease was undoubtedly an administrative act, but r. 54 of the Mineral Concession Rules, 1949 granted a right of review at the instance of an aggrieved party to the Central Government, and authorised it to cancel the order of the State Government or to revise it in such manner as it deemed just and proper.
The exercise of this power was held by this court to be quasi judicial.
Before it was amended by section 27 of Act 65 of 1960, section III of the Indian Companies Act, 1956 omitting parts not material provided: (1) Nothing in sections 108, 109 and 110 shall prejudice any power of the company under its articles to refuse to register the transfer of, or the transmission by operation of law of the right to, any shares or interest of a member in, or debentures of, the company.
(2) If, in pursuance of any such power, a company refuses to register any such transfer or transmission of right, it shall, within two months from the date on which the instrument or transfer, or the intimation of such transmission, as the case may be, was delivered to the company, send notice of the refusal to the transferee and the transferor or to the person giving intimation of such transmission, as the case may be.
(3) The transferor or transferee, or the person who gave intimation of the transmission by operation of law, as the case may be, may, where the company is a public company or a private company which is a subsidiary of a public company, appeal to the Central Government against any refusal of the company to register the transfer or transmission, or against any failure on its part within the period referred to in sub section
(2) either to register the transfer or transmission or to send notice of its refusal to register the same.
(4). . . . . . . . . (5) The Central Government shall, after causing reasonable notice to be given to the company and 346 also to the transferor and the transferee or as the case may require, to the person giving intimation of the transmission by operation of law and the previous owner, if any, and giving them a reasonable opportunity to make their representations, if any, in writing by order, direct either that the transfer or transmission shall be registered by the company or that it need not be registered by it: and in the former case, the company shall give effect to the decision forthwith.
(6) The Central Government may, in its order aforesaid give such incidental and consequential directions as to the payments of costs or otherwise as it thinks fit.
(7) All proceedings in appeals under sub section
(3) or in relation thereto shall be confidential and no suit, pro secution or other legal proceeding shall lie in respect of any allegation made in such proceedings, whether orally or otherwise.
(8) In the case of a private company which is not a subsidiary of a public company, where the right to any shares or interest of a member in, or debentures of, the company, is transmitted by a sale thereof held by a court or other public authority, the provisions of sub sections (3) to (7) shall apply as if the company were a public company: Provided that the Central Government may, in lieu of an order under sub section
(5) pass an order directing the company to register the transmission of the right unless any member or members of the company specified in the order acquire the right aforesaid within such time as may be allowed for the purpose by the order, on payment to the purchaser of the price paid by him therefor or such other sum as the Central Government may determine to be a reasonable compensation for the right in all the circumstances of the case.
Against the refusal by a company to register the transfer or transmission of a right to the shares, an appeal lies to the Central Government.
The Government, after giving notice of the appeal and hearing the parties concerned may order that the shares be registered if it thinks that course is in the circumstances proper.
The Central Government may 347 by the proviso to sub section
(8) in lieu of an order under sub section (5), directing a private company to register,, transmission of shares sold by a court or public authority, order that any member or members of the company specified in the order do acquire the right on payment to the purchaser of the price paid by him, or such other sum as the Central Government determine to be reasonable compensation.
In exercise of the powers under section 642, rules called "The Companies (Appeals to the Central Government) Rules, 1957" have been framed by the Central Government.
By cl. (3) of the rules, the form of the petition of appeal is prescribed.
Clause (4) provides that the memorandum of appeal shall be accompanied by an affidavit and documentary evidence if any in support of the statements made therein including a copy of the letter written by the appellant to the company for the purpose of registration of the shares.
Clause (5) pres cribes the mode of service of notice of appeal to the company and el.(6) authorises the Central Government before considering the appeal to require the appellant or the company to produce within a specified period such further documentary or other evidence as it considers necessary.
Clause (7) enables the parties to make representations if any in writing accompanied by affidavits and documentary evidence.
Clause (8) authorises the Central Government after considering the representations made and after making such further enquiries as it considers necessary to pass such orders as it thinks fit under sub section(5) of section 111 of the Act.
By the appendix to the rules, the form in which notice is to be given to the company is prescribed.
Paragraph 2 of the form states that the company shall be called upon to make its representations in writing against, the appeal and be informed that if no representation is received, the appeal will be determined according to law.
There was no provision similar to section Ill of the Indian , in the Act of 1913, nor is our attention invited to any provision in the English on which our Act is largely based, to a similar provision.
Prior to 1956, if transfer of 348 shares was not registered by the directors of a company, action under the of 1913 could only be taken under section 38 of the Indian Companies Act, 1913 by petition for rectification of the share register.
As we will presently point out, the power to refuse to register a transfer granted by the Articles of Association, if challenged in a petition for rectification of register was to be presumed to have been exercised reasonably, bona fide and for the benefit of the company, and unless otherwise provided by the Articles, the directors were not obliged to disclose reasons on which they acted.
The power had to be exercised for the benefit of the company and bona fide, but a heavy onus lay upon those challenging the resolution of the directors to displace the presumption of bona fide exercise of the power.
The discretion to refuse to register transfers was not liable to be controlled unless the directors "acted oppressively, capriciously or corruptly, or in some way mala fide" (Re Bell Brothers Ltd. ex parte Hodgson) (1).
Power to refuse to register transfer of shares, without assigning any reasons, or in their absolute and uncontrolled discretion, is often found in the Articles of Association, and exercising jurisdiction under section 38 of the Indian Companies Act, 1913, the court may not draw unfavourable inferences from the refusal to disclose reasons in support of their resolution.
The power given to the court under section 38 is now confirmed with slight modification by section 155 of the Indian .
Under that section, the court may rectify the register of shareholders if the name of any person is without sufficient cause entered in or omitted from the register of members of a company, or default is made, or unnecessary delay has taken place in entering on the register the fact of any person having ceased to be a member.
The court is in exercising this jurisdiction competent to decide any question relating to the title of the person claiming to have his name registered and generally to decide all questions which may be necessary or expedient to decide for the rectification.
A person aggrieved by the refusal to (1) 349 register transfer of shares has, since the enactment of the , therefore two remedies for seeking relief under the , (1) to apply to the court for rectification of the register under section 155, and (2) to appeal against the resolution refusing to register the transfers under section 111.
It is common ground that in the exercise of the power under section 155, the court has to act judicially: to adjudicate upon the right exercised by the directors in the light of the powers conferred upon them by the Articles of Association.
The respondents however submit and they are supported by the Union of India that the authority of the Central Government under section Ill is nevertheless purely administrative.
But in an appeal under section 111 el.(3) there is a lis or dispute between the contesting parties relating to their civil rights, and the Central Government is invested with the power to determine that dispute according to law, i.e., it has to consider and decide the proposal and the objections in the light of the evidence, and not on grounds of policy or expediency.
The extent of the power which may be exercised by the Central Government is not delimited by express enactment, but the power is not on that account unrestricted.
The power in appeal to order registration of transfers has to be exercised subject to the limitations similar to those imposed upon the exercise of the power of the court in a petition for that relief under section 155: the restrictions which inhere the exercise of the power of the court also apply to the exercise of the appellate power by the Central Government, i.e., the Central Government has to decide whether in exercising their power, the directors are acting oppressively, capriciously or corruptly, or in some way mala fide.
The decision has manifestly to stand those objective tests, and has not merely to be founded on the subjective satisfaction of the authority deciding the question.
The authority cannot proceed to decide the question posed for its determination on grounds of expediency: the statute empowers the Central Government to decide the disputes arising out of the claims made by the transferor or transferee which claim is opposed by the company, 45 350 and by rendering a decision upon the respective con tentions, the rights of the contesting parties are directly affected.
Prima facie, the exercise of such authority would be judicial.
It is immaterial that the statute which confers the power upon the Central Government does not expressly set out the extent of the power: but the very nature of the jurisdiction requires that it is to be exercised subject to the limitations which apply to the court under section 155.
The proviso to sub section(8) of section III clearly indicates that in circumstances specified therein reasonable compensation may be awarded in lieu of the shares.
This compensation which is to be reasonable has to be ascertained by the Central Government; and reasonable compensation cannot be ascertained except by the application of some objective standards of what is just having regard to all the circumstances of the case.
In The Province of Bombay vs Kusaldas section Advani(1), this court considered the distinction between decisions quasi judicial and administrative or ministerial for the purpose of ascertaining whether they are subject to the jurisdiction to issue a writ of certiorari.
Fazl Ali, J. at p. 642 observed: "The word "decision" in common parlance is more or less a neutral expression and it can be used with reference to purely executive acts as well as judicial orders.
The mere fact that an executive authority has to decide something does not make the decision judicial.
It is the manner in which the decision has to be arrived at which makes the difference, and the real test is: Is there any duty to decide judicially?" The court also approved of the following test suggested in The King vs London County Council (2) by Scrutton L.J.: "It is not necessary that it should be a court in the sense in which this court is a court; it is enough if it is exercising, after hearing evidence, judicial functions in the sense that it has to decide on evidence between a proposal and an opposition; and it is not necessary to be strictly a court; if it is a tribunal which has to (1) T. (2) , 233.351 decide rights after hearing evidence and opposition, it is amenable to the writ of certiorari.
" In The Bharat Bank Ltd., Delhi vs Employees of the Bharat Bank Ltd., Delhi (1), the question whether an adjudication by an industrial tribunal functioning under the Industrial Disputes Act was subject to the jurisdiction of this court under article 136 of the Constitution fell to be determined:, Mahajan J. in that case observed: "There can be no doubt that varieties of administrative tribunals and domestic tribunals are known to exist in this country as well as in other countries of the world but the real question to decide in each case is as to the extent of judicial power of the State exercised by them.
Tribunals which do not derive authority from the sovereign power cannot fall within the ambit of article 136.
The condition precedent for bringing a tribunal within the ambit of article 136 is that it should be constituted by the State.
Again a tribunal would be outside the ambit of article 136 if it is not invested with any part of the judicial functions of the State but discharges purely administrative or executive duties.
Tribunals however which are found invested with certain functions of a Court of Justice and have some of its trappings also would fall within the ambit of article 136 and would be subject to the appellate control of this Court whenever it is found necessary to exercise that control in the interests of justice.
" It was also observed by Fazl Ali J. at p. 463 that a body which is required to act judicially and which exercises judicial power of the State does not cease to be one exercising judicial or quasi judicial functions merely because it is not expressly required to be guided by any recognised substantive law in deciding the disputes which come before it.
The authority of the Central Government entertaining an appeal under section 111(3) being an alternative remedy to an aggrieved party to a petition under section 155 the investiture of authority is in the exercise of the judicial power of the State.
Clause (7) of section III (1) ; 352 declares the proceedings in appeal to be confidential, but that does not dispense with a judicial approach to the evidence.
Under section 54 of the Indian Income tax Act, (which is analogous) all particulars contained in any statement made, return furnished or accounts or documents produced under the provisions of the Act or in any evidence given, or affidavit or deposition made, in the course of any proceedings under the Act are to be treated as confidential; but that does not make the decision of the taxing authorities merely executive.
As the dispute between the parties relates to the civil rights and the Act provides for a right of appeal and makes detailed provisions about hearing and disposal according to law, it is impossible to avoid the inference that a duty is imposed upon the Central Government in deciding the appeal to act judicially.
The Attorney General contended that even if the Central Government was required by the provisions of the Act and the rules to act judicially, the Central Government still not being a tribunal, this court has no power to entertain an appeal against its order or decision.
But the proceedings before the Central Government have all the trappings of a judicial tribunal.
Pleadings have to be filed, evidence in support of the case of each party has to be furnished and the disputes have to be decided according to law after con sidering the representations made by the parties.
If it be granted that the Central Government exercises judicial power of the State to adjudicate upon rights of the parties in civil matters when there is a lis between the contesting parties, the conclusion is inevitable that it acts as a tribunal and not as an executive body.
We therefore over rule the preliminary objection raised on behalf of the Union of India and by the respondents as to the maintainability of the appeals.
The Memorandum and Articles of Association of a company when registered bind the company and the members of the company to the same extent as if they respectively had been signed by the company and each member, and contained covenants on its and 353 his part to observe all the provisions of the Memorandum and of the Articles.
Clause 47B of the Articles of Association which invests the director with discretion to refuse to register shares is therefore an incident of the contract binding upon the transferor, and registration of transfer or transmission cannot therefore be insisted upon as a matter of right.
The conditions subject to which a party can maintain a petition for an order for rectification of the register of shareholders have been settled by a long course of decisions.
Two of those may be noticed.
In In re Gresham Life Assurance Society Ex parte Penney (1), the deed of settlement of a life insurance company provided that any shareholder shall be at liberty to transfer his shares to any other person who was already a shareholder, or who should be approved by the board of directors, and that no person not being already a shareholder or the executor of a shareholder, should be entitled to become the transferee of any share unless approved by the board.
One J. R. De Paiva who was the holder of ten shares of the company sold them to W. J. Penney and lodged the transfer with the shares for registration at the company 's office.
The directors in exercise of the powers conferred upon them by the deed of settlement refused to register the shares.
In a joint summons taken out by Paiva and Penney under section 35 of the Companies Act, 1862, the Master of the Rolls directed the transfer to be registered, the directors of the company having failed to submit any reasonable ground or objection to the purchaser.
In the view of the Master of the Rolls, it was for the court to judge whether the objection was reasonable and that objection must be disclosed to the court.
Against this order, the company approached the Court of Appeal.
James L. J. in dealing with the contention raised by the appellant observed that the directors were in a fiduciary position both towards the company and towards every shareholder and that it was easy to conceive of cases in which the court may interfere with any violation of the fiduciary duty so (1) (1872) Law Rep. 8 Ch.
354 reposed in the directors.
It was observed by James L. J.: "But in order to interfere upon that ground it must be made out that the directors have been acting from some improper motive, or arbitrarily and capriciously.
That must be alleged and proved, and the person who has a right to allege and prove it is the shareholder who seeks to be removed from the list of shareholders and to substitute another person for himself . this Court would have jurisdiction to deal with it as a corrupt breach of trust; but if there is no such corrupt or arbitrary conduct as between the directors and the person who is seeking to transfer his shares, it does not appear to me that this court has any jurisdiction whatever to sit as a Court of Appeal from the deliberate decision of the board of directors, to whom, by the constitution of the company, the question of determining the eligibility or non eligibility of new members is committed.
If the directors had been minded, and the Court was satisfied that they were minded, whether they expressed it or not, positively to prevent a shareholder from parting with his shares, unless upon complying with some condition which they chose to impose, the Court would probably, in exercise of its duty as between the cestui que trust and the trustees, interfere to redress the mischief, either by compelling the transfer or giving damages, or in some mode or other to redress the mischief which the shareholder would have had a just right to complain of.
" It was also observed by James L.J.: " I am of opinion that we cannot sit as a Court of Appeal from the conclusion which the directors have arrived at if we are satisfied that the directors have done that which alone they could be compelled by mandamus to do, to take the matter into their consideration".
Mellish L.J. observed: "But it is further contended that in order to secure the existing shareholder against being deprived of the right to sell his shares, the directors are 355 bound to give their reason why they reject the transferee, and if they reject him without giving a reason that is a ground from which the Court ought to infer that they were acting arbitrarily.
I cannot agree with that.
It appears to me that it is very important that directors should be able to exercise the power in a perfectly uncontrollable manner for the benefit of the shareholders; but it is impossible that they could fairly and properly exercise it if they were compelled to give the reason why they rejected a particular individual.
I am therefore of opinion that in order to preserve to the company the right which is given by the articles a shareholder is not to be put upon the register if the board of directors do not assent to him, and it is absolutely necessary that they should not be bound to give their reasons although I perfectly agree that if it can be shown affirmatively that they are exercising their power capriciously and wantonly, that may be a ground for the Court interfering".
A similar view was also expressed in In re, Smith and Fawcett Ltd. (1) where the Court of Appeal held that where the directors of the company had uncontrolled and absolute discretion to refuse to register any transfer of shares, while such powers are of a fiduciary nature and must be, exercised in the interest of the company, the petition for registration of transfer should be dismissed unless there is something to show that they had been otherwise exercised.
Rectification of the register under section 155 can therefore be granted only if the transferor establishes that the directors had, in refusing to register the shares in the names of a transferee, acted oppressively, capriciously or corruptly, or in some way mala fide and not in the interest of the company.
Such a plea has, in a petition for rectification, to be expressly raised and affirmatively proved by evidence.
Normally, the court would presume that where the directors have refused to register the transfer of shares when they have been invested with absolute discretion to refuse registration, that the exercise of the power was bona fide.
When (1) 356 the new Companies Act was enacted, it was well settled that the discretionary power conferred by the articles of association to refuse to register would be presumed to be properly exercised and it was for the aggrieved transferor to show affirmatively that it had been exercised mala fide and not in the interest of the company.
Before the Committee appointed by the Government of India under the Chairmanship of Mr. C. H. Bhabha representation was made by several bodies that this power which was intended to be exercised for the benefit of the company was being misused and the Committee with a view to afford some reasonable safeguards against such misuse of the power recommended that a right of appeal should be provided against refusal to register transfer of shares.
The Legislature, it appears, ,accepted this suggestion and provided a right of appeal.
But the power to entertain the appeal is not unrestricted: being an alternative to the right to approach the civil court, it must be subject to the same limitations which are implicit in the exercise of the power by the civil court under section 155.
The Central Government may therefore exercise the power to order that the transfer which the directors have in their discretion refused, be registered if it is satisfied that the exercise of the discretion is mala fide, arbitrary or capricious and that it is in the interest of the company that the transfer should be registered.
Relying upon el.(7) of section 111 which provided that the proceedings in appeals under sub section(3) or in relation thereto shall be confidential, it was urged that the authority hearing the appeal is not obliged to set out reasons in support of its conclusion and it must be assumed that in disposing of the appeal, the authority acted properly and directed registration of shares.
But the provision that the proceedings are to be treated as confidential is made with a view to facilitate a free disclosure of evidence before the Central Government which disclosure may not, in the light of publicity which attaches to proceedings in the ordinary courts, be possible in a petition under section 155 of the 357 Companies Act.
The mere fact that the proceedings are to be treated as confidential does not dispense with a judicial approach nor does it obviate the disclosure of sufficient grounds and evidence in support of the order.
In the present case, the position is somewhat un satisfactory.
The directors passed a resolution declining to register the shares and informed the transferor and the transferees of that resolution.
The transferees in their petition stated that the refusal to register transfer was without any reason, arbitrary and untenable and in the grounds of appeal they stated that they did not know of any reasons in sup port of the refusal and reserved liberty to reply thereto if any such reasons were given.
The company in reply merely asserted that the refusal was not without any reason or arbitrary or untenable.
The transferees in their rejoinder made a curious statement of which it is difficult to appreciate the import that they had "nowhere stated in the memoranda of appeals that the refusal to transfer shares was capricious or mala fide" and all that they "had stated was that the refusal was without any reason, arbitrary or untenable".
The Deputy Secretary who decided the appeals chose to give no reasons in support of his orders.
There is nothing on the record to show that he was satisfied that the action of the directors in refusing to register the shares "was arbitrary and untenable" as alleged.
If the Central Government acts as a tribunal exercising judicial powers and the exercise of that power is subject to the jurisdiction of this court under article 136 of the Constitution, we fail to see how the power of this court can be effectively exercised if reasons are not given by the Central Government in support of its order.
In the petition under section 38 of the Indian Companies Act, 1913, the Bombay High Court declined to order rectification on a summary proceeding and relegated the parties to a suit and a similar order was passed by the Joint Secretary, Ministry of Finance.
These proceedings were brought to the notice of the Deputy Secretary who heard the appeals.
Whether 46 358 in spite of the opinion recorded by the High Court and by the Joint Secretary, Ministry of Finance in respect of another block out of shares previously attempted to be transferred, there were adequate grounds for directing registration, is a matter on which we are unable to express any opinion.
All the documents which were produced before the Deputy Secretary are not printed in the record before us and we were told at the bar that there were several other documents which the Deputy Secretary took into con sideration.
In the absence of anything to show that the Central Government exercised its restricted power in hearing an appeal under section 111(3) and passed the orders under appeal in the light of the restrictions imposed by article 47B of the articles of association and in the interest of the company, we are unable to decide whether the Central Government did not transgress the limits of their power.
We are however of the view that there has been no proper trial of the appeals, no reasons having been given in support of the orders by the Deputy Secretary who heard the appeals.
In the circumstances, we quash the orders passed by the Central Government and direct that the appeals be re heard and disposed of according to law.
Costs of these appeals will be costs in the appeals before the Central Government.
HIDAYATULLAH, J. I have had the advantage of reading the judgment just delivered by my brother, Shah, J.
In view of the strong objection to the competence of the appeals under article 136 by the respondents, to whom liberty was reserved by the order granting special leave, I have found it necessary to express my views.
The facts have been stated in detail by my learned brother, and I shall not repeat them in full.
Very shortly stated, the facts are that the second respondent, Banarsi Prasad Jhunjhunwala, transferred 2500 shares to his son, and 2100 shares to his daughter in law, in the appellant Company in 1953.
The appellant Company declined to register these transfers.
Proceedings for rectification of the Register under section 38 of the Indian Companies Act, 1913, followed 359 in the High Court of Bombay, but the High Court referred the disputants to the Civil Court.
In the petition before the High Court, the respondents had charged the Directors of the appellant Company with bad faith and arbitrary dealing.
The respondents renewed their requests for registration, but they were again declined, and appeals were filed before the Central, Government under section 111(3) of the , which had come into force from April 1, 1956.
These appeals were heard by Mr. K. R. P. Aiyengar, Joint Secretary, Ministry of Finance, who dismissed them, holding that only a suit was the appropriate remedy.
Banarsidas Prasad then made a fresh transfer of 100 shares each to his son and daughter in law, and requests for registration of these shares were made.
The appellant Company again declined to register the shares, but gave no reaons.
Under cl. 47 B of the Articles of Association of the appellant Company, it is provided: "The Directors may in their absolute discretion and without giving any reason refuse to register any transfer of any shares whether such shares be fully paid or not.
If the Directors refuse to register the transfer of any shares, they shall, within two months after the date on which the transfer was lodged with the company, send to the trans feree and the transferor notice of the refusal.
" The appellant Company was prima facie within its rights when it did not state any reasons for declining to register the shares in question.
Appeals were again taken to the Central Government under section 111(3).
It was alleged that the refusal to register the shares without giving any reasons was "arbitrary and untenable".
In accordance with the provisions of the section, representations were filed by the appellant Company and rejoinders by the opposite party.
The transferees made it clear that they did not charge the appellant Company with "capricious or mala flee conduct" but only with arbitrary any reasons.
The appeals 360 succeeded, and the shares were ordered to be registered.
The Deputy Secretary, who heard and decided the appeals, gave no reasons for his decision.
Against his order, the present appeals have been filed with special leave.
The preliminary objection is that the appeals are incompetent, because the Central Government, which heard them, is not a tribunal muchless a Court, and the action of the Central Government is purely administrative.
It is, therefore, submitted that article 136 does not apply, because special leave can only be granted in respect of a determination by a Court or a tribunal, which the Central Government is not.
This is not the only provision of law, under which the Central or State Governments have been empowered to hear appeals, revisions or reviews, and it is thus necessary to find out the exact status of the Central Government when it hears and decides appeals, etc., for the application of article 136.
Article 136(1) reads as follows: "Notwithstanding anything in this Chapter, the Supreme Court may in its discretion, grant special leave to appeal from any judgment, decree, determination, sentence or order in any cause or matter passed or made by any Court or tribunal in the territory of India.
" The orders which the Central Government passes, certainly fall within the words "determination" and "order".
The proceeding before the Central Government also falls within the wide words "any cause or matter".
The only question is whether the Central Government, when it hears and decides an appeal, can be said to be acting as a Court or tribunal.
That the Central Government is not a Court was assumed at the hearing.
But to ascertain what falls within the expression "Court or tribunal", one has to begin with "Courts".
The word "Court" is not defined in the .
It is not defined in the Civil Procedure Code.
The definition in the Indian Evidence Act is not exhaustive, and is for the purposes of that Act.
In the Now English Dictionary (Vol. II, pp. 1090, 1091), the meaning given is: 361 "an assembly of judges or other persons legally appointed and acting as a tribunal to hear and determine any cause, civil, ecclesiastical, military or naval.
" All tribunals are not Courts, though all Courts are tribunals.
The word "Courts" is used to designate those tribunals which are set up in an organised State for the administration of justice.
By administration of justice is meant the exercise of judicial power of the State to maintain and uphold rights and to punish "wrongs".
Whenever there is an infringement of a right or an injury, the Courts are there to restore the vinculum juris, which is disturbed.
Judicial power, according to Griffith, C. J. in Huddart, Parker & Co. Proprietary Ltd. vs Moorehead (1) means: "the power which every sovereign authority must of necessity have to decide controversies between its subjects, or between itself and its subjects, whether the rights relate to life, liberty or property.
The exercise of this power does not begin until some tribunal which has power to give a binding and authoritative decision (whether subject to appeal or not) is called upon to take action.
" When rights are infringed or invaded, the aggrieved party can go and commence a querela before the ordinary Civil Courts.
These Courts which are instrumentalities of Government, are invested with the judicial power of the State, and their authority is derived from the Constitution or some Act of legislature constituting them.
Their number is ordinarily fixed and they are ordinarily permanent, and can try any suit or cause within their jurisdiction.
Their numbers may be increased or decreased, but they are almost always permanent and go under the compendious name of "Courts of Civil Judicature".
There can thus be no doubt that the Central Government does not come within this class.
With the growth of civilisation and the problems of modern life, a large number of administrative tribunals have come into existence.
These tribunals have the authority of law to pronounce upon valuable (1) ; , 357.362 rights; they act in a judicial manner and even on evidence on oath, but they are not part of the ordinary Courts of Civil Judicature.
They share the exercise of the judicial power of the State, but they are brought into existence to implement some administrative policy or to determine controversies arising out of some administrative law.
They are very similar to Courts, but are not Courts.
When the Constitution speaks of 'Courts ' in article 136, 227 or 228 or in Art,% 233 to 237 or in the Lists, it contemplates Courts of Civil Judicature but not tribunals other than such Courts.
This is the reason for using both the expressions in articles 136 and 227.
By "Courts" is meant Courts of Civil Judicature and by "tribunals", those bodies of men who are appointed to decide controversies arising under certain special laws.
Among the powers of the State is included the power to decide such controversies.
This is undoubtedly one of the attributes of the State, and is aptly called the judicial power of the State.
In the exercise of this power, a clear division is thus noticeable.
Broadly speaking, certain special matters go before tribunals, and the residue goes before the ordinary Courts of Civil Judicature.
Their procedures may differ, but the functions are not essentially different.
What distinguishes them has never been success fully established.
Lord Stamp said that the real distinction is that Courts have "an air of detachment".
But this is more a matter of age and tradition and is not of the essence.
Many tribunals, in recent years, have acquitted themselves so well and with such detachment as to make this test insufficient.
Lord Sankey, L.C. in Shell Company of Australia vs Federal Commissioner of Taxation (1) observed: "The authorities are clear to show that there are tribunals with many of the trappings of a Court, which, nevertheless, are not Courts in the strict sense of exercising judicial power.
In that connection it may be useful to enumerate some negative propositions on this subject: 1.
A tribunal is not necessarily a Court in this strict sense because it gives a final decision.
Nor because it hears (1) [1931] A.C.275.363 witnesses on oath.
Nor because two or more contending parties appear before it between whom it,, has to decide.
Nor because it gives decisions which affect the rights of subjects.
Nor because there is an appeal to a Court.
Nor because it is a body to which a matter is referred by another body.
See Rex vs Electricity Commissioners In my opinion, a Court in 'the strict sense is a tribunal which is a part of the ordinary hierarchy of Courts of Civil Judicature maintained by the State under its constitution to exercise the judicial power of the State.
These Courts perform all the judicial functions of the State except those that are excluded by law from their jurisdiction.
The word "judicial", be it noted, is itself capable of two meanings.
They were admirably stated by Lopes, L.J. in Royal Aquarium and Summer and Winter Garden Society vs Parkinson (2), in these words: "The word 'judicial ' has two meanings.
It may refer to the discharge of duties exercisable by a judge or by justices in court, or to administrative duties which need not be performed in court, but in respect of which it is necessary to bring to bear a judicial mind that is, a mind to determine what is fair and just in respect of the matters under con sideration.
" That an officer is required to decide matters before him "judicially" in the second sense does not make him a Court or even a tribunal, because that only establishes that he is following a standard of conduct, and is free from bias or interest.
Courts and tribunals act "judicially" in both senses, and in the term "Court" are included the ordinary and permanent tribunals and in the term "tribunal" are included all others, which are not so included.
Now, the matter would have been simple, if the had designated a person or persons whether by name or by office for the purpose of hearing an appeal under section 111.
It would then have been clear that though such person or persons were not "Courts" in the sense explained, they were clearly (1) (2) , 452, 364 "tribunals".
The Act says that an appeal shall lie to the Central Government.
We are, therefore, faced with the question whether the Central Government can be said to be a tribunal.
Reliance is placed upon a recent decision of this Court in Shivji Nathubai vs The Union of India (1), where it was held that the Central Government in exercising power of review under the Mineral Concession Rules, 1949, was subject to the appellate jurisdiction conferred by article 136.
In that case which came to this Court on appeal from the High Court 's order under article 226, it was held on the authority of Province of Bombay vs Kushaldas section Advani (1) and Rex vs Electricity Commissioners (3) that the action of the Central Government was quasi judicial and not administrative.
It was then observed: "It is in the circumstances apparent that as soon as r. 52 gives a right to an aggrieved party to apply for review a lis is created between him and the party in whose favour the grant has been made.
Unless therefore there is anything in the statute to the contrary it will be the duty of the authority to act judicially and its decision would be a quasi judicial act.
" This observation only establishes that the decision is a quasi judicial one, but it does not say that the Central Government can be regarded as a tribunal.
In my opinion, these are very different matters, and now that the question has been raised, it should be decided.
The function that the Central Government performs under the Act and the Rules is to hear an appeal against the action of the Directors.
For that purpose, a memorandum of appeal setting out the grounds has to be filed, and the Company, on notice, is required to make representations, if any, and so also the other side, and both sides are allowed to tender evidence to support their representations.
The Central Government by its order then directs that the shares be registered or need not be registered.
The Central Government is also empowered to include in its orders, directions as to payment of costs or otherwise.
The (1) ; (2) ; (3) 365 function of the Central Government is curial and not executive.
There is provision for a hearing and a decision on evidence, and that is indubitably a curial function.
Now, in its functions Government often reaches decisions, but all decisions of Government cannot be regarded as those of a tribunal.
Resolutions of Government may affect rights of parties, and yet, they may not be in the exercise of judicial power.
Resolutions of Government may be amenable to writs under articles 32 and 226 in appropriate cases, but may not be subject to a direct appeal under article 136 as the decisions of a tribunal.
The position, however, changes when Government embarks upon curial functions, and proceeds to exercise judicial power and decide disputes.
In these circumstances, it is legitimate to regard the officer who deals with the matter and even Government itself as a tribunal.
The officer who decides, may even be anonymous; but the decision is one of a tribunal, whether expressed in his name or in the name of ' the Central Government.
The word "tribunal" is a word of wide import, and the words "Court" and "tribunal" embrace within them the exercise of judicial power in all its forms.
The decision of Government thus falls within the powers of this Court under article 136.
It is next argued by the learned Attorney General that there is no law to interpret or to apply in these cases.
He argues that since there are no legal standards for judging the correctness or otherwise of the order of the Central Government and the decision being purely discretionary, it is neither judicial nor quasi judicial but merely administrative, and that no appeal can arise from the nature of things.
Such a line was taken before the Committee on Ministers ' Powers by Lord Hewart, and the argument reminds one of what he then said that such decisions are purely discretionary and the exercise of such arbitrary power is "neither law nor justice or at all".
Sir Maurice Gwyer also was of the opinion that an appeal could not be taken to Court against a Minister 's 47 366 decision even on the ground of miscarriage of justice, because that, in his opinion, was "putting a duty on the Court" which was "not the concern of the Court".
This argument takes me to the heart of the controversy, and before I give my decision, I wish to say a few preliminary things.
Article 47 B gives to the Directors a right to refuse to register shares in their absolute discretion, without giving reasons.
In In re Gresham Life Assurance Society, Ex Parte Penney James, L.J. observed: "No doubt the directors are in a fiduciary position both towards the company and towards every shareholder in it.
It is very easy to conceive cases such as those cases to which we have been referred, in which this Court would interfere with any violation of the fiduciary duty so reposed in the directors.
But in order to interfere upon that ground it must be made out that the directors have been acting from some improper motive, or arbitrarily and capriciously.
That must be alleged and proved, and the person who has a right to allege and prove it is the shareholder who seeks to be removed from the list of shareholders and to substitute another person for himself.
But if it is said that wherever any shareholder has proposed to transfer his shares to some new member, the Court has a right to say to the directors, 'We will presume that your motives are arbitrary and capricious, or that your conduct is corrupt, unless you choose to tell us what your reasons were, and submit those reasons to our decision ', it would appear to me entirely altering the whole constitution of the company as provided by the articles."
That shows that the Directors are presumed to have acted honestly in the interests of the company and a case has to be made out against them.
I shall only quote from another case, which summarises the position very aptly.
In In re Hannan 's King (Browning) Gold Mining Company (Limited) (2), Lindley, M.R. is reported to have decided the case thus: "Their Lordships did not sit there as a Court of (1) (1872) Law Rep. 8 Ch.(2) , 367 honour; the question was whether the applicants had made out that the transferee was being improperly kept off the register.
There was no evidence of that .
The Court ought, as a matter of honesty between man to man., to presume that the directors were acting within their powers unless the contrary was proved; but that was not proved by casting unfounded aspersions upon them."
Thus, the matter comes to this that the Directors have a presumption in their favour and the opposite party must prove that there was want of good faith.
The right of appeal which is given under the , allows the Central Government to judge this issue.
For that purpose, parties are required, if they desire, to make representations and to put in evidence.
But to enable the parties to have a free say, the proceedings are made confidential by law, and there is protection against action, both civil and criminal.
The appeal is disposed of on the basis of the representations and the evidence.
A decision of a tribunal on a dispute inter partes, in the light of pleadings and evidence, is essentially a judicial one, and this Court ought to be able, on the same material, to decide in an appeal whether the decision given was correct.
If no substantive law is applicable, there are questions of evidence, of burden and adequacy of proof and of the application of the principles of justice, equity and good conscience to guide the Court.
Once it is held that the decision is that of a tribunal and subject to appeal, it is manifest that an appeal may lie, unless there be some other reason.
The difficulty which arises in these cases is whether it was not the intention of the law that the decision of the Central Government was to be final.
The law makes all allegations and counter allegations confidential.
If Courts cannot compel disclosure of these allegations and the veil of secrecy drawn by law is not rent, then it appears to me that a further appeal can hardly be efficacious.
In this view, in my opinion, this Court should not grant special leave in such cases.
The situation which arises is not very different from what arose before the Judicial Committee in Moses vs 368 Parker, Ex Parte Moses (1).
The headnote adequately gives the facts, and may be quoted: "By Tasmanian Act No. 10 of 1858, section 5, disputes concerning lands yet ungranted by the Crown are referred to the Supreme Court, whose decision is to be final; and by section 8 the Court is directed to be guided by equity and good conscience only, and by the best evidence procurable, even if not required or admissible in ordinary cases, and not to be bound by strict rules of law or equity or by any legal forms: Held: that the Crown 's prerogative to grant special leave to appeal is inapplicable to a decision so authorised."
In dealing with the case, Lord Hobhouse observed at p. 248: "The Supreme Court has rightly observed that Her Majesty 's prerogative is not taken away by the Act of 1858, but intimates a doubt whether it ever came into existence.
Their Lordships think that this doubt is well founded.
They cannot look upon the decision of the Supreme Court as a judicial decision admitting of appeal.
The Court has been substituted for the commissioners to report to the governor.
The difference is that their report is to be binding on him.
Probably it was thought that the status and training of the judges made them the most proper depositaries of that power.
But that does not make their action a judicial action in the sense that it can be tested and altered by appeal.
It is no more judicial than was the action of the commissioners and the governor.
The Court is to be guided by equity and good conscience and the best evidence.
So were the commissioners.
So every public officer ought to be.
But they are expressly exonerated from all rules of law and equity, and all legal forms.
How then can the propriety of their decision be tested on appeal? What are the canons by which this Board is to be guided in advising Her Majesty whether the Supreme Court is right or wrong? It seems almost (1) 369 impossible that decisions can be varied except by reference to some rule; whereas the Court making them is free from rules.
If appeals were allowed, the certain result would be to establish some system of rules; and that is the very thing from which the Tasmanian Legislature has desired to leave the Supreme Court free and unfettered in each case.
If it were clear that appeals ought to be allowed, such difficulties would doubtless be met somehow.
But there are strong arguments to show that the matter is not of an appealable nature."
See also The ' berge vs Laudry (1).
The exercise of the powers under article 136 is a counterpart of the royal prerogative to hear appeals in any cause or matter decided by Courts or tribunals.
But where the Articles of Association of a company give absolute discretion to the Directors and empower them to withhold their reasons, the appeal taken to the Central Government would involve decision on such material, which the parties place before it.
If the allegations are made confidential by law and the Central Government in giving its decision cannot make them public, it is manifest that the decision, to borrow Lord Hobhouse 's language, "is not of an appealable nature".
Whether the right to hear appeals generally against decisions of the Central Government acting as a tribunal be within article 136, in my opinion and I say it with great respect special leave to appeal should not be granted in such cases, unless this Court is able to rend the veil of secrecy cast by the law without rending the law itself.
The argument is that the allegations are confidential only so far as the public are concerned but not confidential where Courts are concerned.
The question is not that but one of practice of this Court.
This Court should intervene only when practicable, and that can only arise if the parties agree not to treat the allegations as confidential.
That, however, does not end the present appeals.
Special leave has been granted, and I have held that the appeals are competent, even though such cases (1) 370 often may not be fit for appeal.
In this case, there is no claim that any allegation was confidential.
In fact, the appellants before the Central Government made it clear that they did not charge the Directors with "capricious or mala fide conduct" but only with arbitrary refusal, without stating any reasons.
The appellant Company in its representation set out the history of previous refusals and the decisions of the High Court of Bombay and the Central Government, and made it clear that the action was taken in the interest of the Company.
There are indications in the representation to show that on the previous occasion when these claimants were referred by the High Court and by Mr. K. R. P. Aiyengar, Joint Secretary, to the Civil Court, they did not go to Court to establish that the action was mala fide and capricious.
Before the Central Government, they dropped that allegation, and confined the case to one of refusal without giving any reasons, and that was the plain issue before the Central Government.
There was no evidence for the Central Government to consider, and the Articles of Association give the Directors an absolute discretion to refuse to register shares without giving any reasons, and, on the authorities quoted earlier, the Directors must be presumed to have acted honestly.
There was thus no reason for the Central Government to reverse the decision of the Directors, and the fact that no reasons have been given when nothing was confidential, leads to the only inference that there was none to give.
In my opinion, these appeals must succeed.
I would, therefore, set aside the order of the Central Government, and allow the appeals with costs here and before the Central Government, if an order to that effect was passed by the Central Government.
Before parting with the case, I may say that the Report of the Amendment Committee had recommended amendment of section 111, and it has been amended, inter alia, by the addition of sub section (5A), which reads: "Before making an order under sub section (5) on an appeal against any refusal of the company to 371 register any transfer or transmission, the Central Government may require the company to disclose to it the reasons for such refusal, and on the failure or refusal of the company to disclose such reasons, that Government may, notwithstanding anything contained in the articles of the company, presume that the disclosure, if made, would be unfavourable to the company."
That would stop the blind man 's buff under the unamended law!
By COURT.
In view of the majority judgment of the Court, we quash the orders passed by the Central Government and direct that the appeals be reheard and disposed of according to law.
Costs of these appeals will be costs in the appeals before the Central Government.
[/INST]Section 9 of the , entitles a duly enrolled Mukhtar to "Practise" in any Civil Court, and section 11 thereof empowers the High Court to make rules declaring .what shall be deemed to be the ,functions, powers and duties" of Mukhtars practising in the subordinate Courts.
Rule 2 framed under section 1 1 lays down that a Mukhtar shall not be allowed to address any Civil Court except for the purpose of "stating the nature.
and effect of his application or to offer any legal argument or to examine any witness" without the leave of the Court.
The petitioners contended that r. 2 was in excess of the rule making power under section 1 1 and was an unreasonable restriction on their rights under article 19 (1) (g) of the Constitution.
Held, that sections 9 and 1 1 of the Act must be read together and the right to "practise" given under section 9 cannot be dissociated from the "functions, powers and duties of Mukhtars" as contemplated under section 11.
In declaring what shall be the functions, powers and duties of a Mukhtar the High Court may by its rules so delimit them as to regulate their right of practice in the Civil Courts, and such delimitation is no violation of their fundamental right to practise the profession as allowed under the Act.
Aswini Kumar Ghosh vs Arabinda Bose, , explained and distinguished.
</s>
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<s>[INST] Summarize the judgementAppeal No. 461 of 1957.
Appeal by special leave from the judgment and decree dated July 5, 1954.
of the Punjab High Court in L. P. A. No. 29 of 1953.
N. section Bindra and Sardar Singh, for the appellant.
P. D. Ahuja and H. P. Wanchoo, for respondent No. 1.
471 1961.
March 21.
The Judgment of the Court was delivered by WANCHOO, J.
This is an appeal by special leave from the judgment of the Punjab High Court and arises out of a suit for possession of land brought by Munshi Ram, respondent.
The following pedigreetable will be useful in understanding the claim put forward by the respondent: Heman Karori Laghi Maghi Jai Dayal (issueless) Gobind Ata Nanak Chand Santu Munshi Ram (adopted son) plaintiff Hans Raj Salig Kam ( Defdt.) MunshiRam (adopted by Ata) The claim of Munshi Ram was with respect to the property left by Nanak Chand who is his natural grandfather and also Santu.
There is no dispute now about the property of Santu and we are concerned in this appeal only with the property of Nanak Chand.
Nanak Chand died in 1939.
Munshi Ram 's natural father Hans Raj had predeceased Nanak Dhand.
Munshi Ram himself was adopted by Ata in 1918 before the death of his natural father Hans Raj which took place in 1920.
It will be clear from these dates therefore that Hans Raj never succeeded to the property of his father Nanak Chand and Munshi Ram had been adopted by Ata even before Hans Raj 's death.
The case of Munshi Ram was that he was entitled to one half share of the property left by Nanak Chand as his their, according to Zamindara custom.
The parties, it may be Mentioned, are Brahmins and Munshi Ram claimed joint possession of the half share of the property left by Nanak Chand on his 472 death.
The suit was resisted by Salig Ram (defendant appellant) who is the other son of Nanak Chand.
His case was that Munshi Ram was not entitled either according to personal law or the riwaj i am of Amritsar district to any share in the property left by Nanak Chand.
The trial court held that Munshi Ram was entitled to succeed to the property left.
by, Nanak Chand along with Salig Ram and decreed the suit accordingly Salig Ram went in appeal to the District Judge but failed.
He then went in second appeal to the High Court but the second appeal was also dismissed The High Court having refused to grant a certificate the appellant applied to this Court for special leave which was granted; and that is how the matter has come up before us.
In questions regarding succession and certain other matters, the law in the Punjab is contained in section 5 of the , No. IV of 1872.
Clause (b) of that section provides that the rule of decision in such matters shall be the Hindu law where the parties are Hindus, except in so far as such law has been altered or abolished by legislative enactment, or is opposed to the provisions of this Act or has been modified by any such custom as is referred to in cl.
(a) thereof.
Clause (a) provides that any custom applicable to the parties concerned, which is not contrary to Justice, equity or good conscience, and has not been by this or any other enactment altered or abolished and has not been declared to be void by any competent authority shall be applied in such matters.
The position therefore that emerges is, where the parties are Hindus, the Hindu law would apply in the first instance and whosoever asserts a custom at variance with the Hindu law shall have to prove it, though the quantum of proof required in support of the custom which is general and well recognised may be small while in other cases of what are called special customs the quantum may be larger.
As was pointed out by Robertson, J., as far back as 1906 in Daya Ram vs Sohel Singh and others (1), "in all cases under section 5 of the , it lies upon the person asserting that he is ruled (1) 1906 P. R. No. 110.
473 in regard to a particular matter by custom, to prove that he is so governed, and not by personal law, and further to prove what the particular custom is.
There is no presumption created by the clause in favour of custom; on the contrary it is only when the custom is established that it is to be the rule of decision.
" These observations were approved by the Privy Council in Abdul Hussein Khan vs Bibi Sona Dero and another (1).
The same view has been taken by this Court in Ujagar Singh vs Mst.
Jeo (2).
We have therefore in the first instance to apply Hindu law to the parties to this suit, and it is only when a custom different from Hindu law is proved that rights of the parties would be governed by that custom.
Munshi Ram 's case was that he was adopted by Ata according to custom (i.e., in accordance with the mode prevalent in the community for purposes of adoption) during the lifetime of Hans Raj.
Thus Munshi Ram having been adopted by Ata would have no right left in the family of his natural father Hans Raj, unless the adoption was in the dvyamushyayana form.
It was however never the case of Munshi Ram that the adoption was in dvyamushyayana form and so far as Hindu law is concerned, if it applies to this case Munfshi Ram would not be entitled after the adoption to succeed to the property left by Nanak Chand.
But Munshi Ram 's case was that according to Zamindara custom he was entitled to succeed to half of the properties left by Nanak Chand.
The question therefore arises: what the Zamindara custom is in the present case.
In the plaint the custom was not actually pleaded, though strictly speaking this should have been done.
However, the custom that is relied upon is to be found in para.
48 of the Digest of Customary Law in the Punjab by Rattigan at p. 572, 13th Edition.
This paragraph appears in section V dealing with "Effect of Adoption on Succession" and is in the following terms: "An heir appointed in the manner above described ordinarily does not thereby lose his right to succeed (1) (1917) L. R. 45 I. A. 10, 13.
(2) [1959] SUPP.
2 S.C. R. 781 60 474 to property in his natural family, as against collaterals, but does not succeed in the presence of his natural brothers.
" It is not disputed before ,is that para.
48 applies in the case of adoption also; but what is contended on behalf of the appellant is that para.
48 only mentions a custom prevalent throughout the Punjab while the riwaj i am of Amritsar district from which area the parties come also records a custom confined to that area which really governs the parties.
It appears that in 1865 the riwaj i am of Amritsar district stated that "an adopted son will not be a co sharer amongst his brothers, in the property left by his natural father", i.e., a son given away in adoption will not inherit in the natural father 's family.
We may in this connection refer to Jai Kaur and others vs Sher Singh and others (1), where this Court held that "there is therefore an initial presumption of correctness as regards the entries in the Riwaj i am and when the custom as recorded in the Riwaj i am is in conflict with the general custom as recorded in Rattigan 's Digest or ascertained otherwise, the entries in the Riwaj i am should ordinarily prevail except that as was pointed out by the Judicial Committee of the, Privy Council in a recent decision in Mt. Subhani vs Nawab (2), that where, a,% in the present case, the Riwaj i am affects adversely the rights of females who had no opportunity whatever of appearing before the revenue authorities, the presumption would be weak, and only a few instances would suffice to rebut it.
" As females are not concerned in this case, the entries in the riwaj i am of Amritsar district in 1865, if they conflict with para.
48 of Rattigan 's Digest,, should prevail.
On that view Munshi Ram would have no right to succeed in the family of his natural father after he was adopted by Ata.
The High Court, however, pointed out that there were decisions of courts which did not accept the riwaj i am of Amritsar district of 1865 as laying down the correct custom and therefore para.
48 of the Digest by Rattigan would still prevail.
(1) A.I. R. (2) A.I.R. 1941 P.C. 21. 475 In this connection the High Court relied on Majja Singh and others vs Rain Singh (1).
That was however a case of Jats and not of Brahmins and the person who was adopted in that case was an only son.
That case would not therefore necessarily override the custom so far as it applies to Brahmins.
In any case the position is made clear by the Manual of Customary Law prepared in 1911 12 by Mr. Cralk.
The custom recorded in that compilation is that with the exception of Brahmins and Khatris, an adopted son does not retain his right to inherit from his natural father, even if the latter dies without leaving any other son.
The High Court however pointed out that the Brahmin,,; and khatris did not accept this custom; but it failed to notice a further paragraph in answer to that very question where it was pointed out that among Brahmins and Khatris the same custom prevailed except that where there was no other son, the son who was adopted in another family would succeed to the property of his natural father.
In 1940 the customary law of Amritsar district was again compiled and the custom recorded is that an adopted son loses his right to inherit from his natural father but if the latter dies without other sons the adopted son cannot inherit as a son but may inherit collaterally as a successor of his adoptive father.
The position as it emerges from a comparison of the entries in the riwaj i am of 1865, 1911 12 and 1940 is somewhat confused and the High Court therefore thought that the custom recorded in para.
48 should be adhered to as Brahmins and Khatris did not accept the extreme position that as on given away in adoption was excluded altogether from succeeding in his natural father 's family as recorded in 1911,12.
This conclusion seems to be fortified by the statements of Brahmins and Khatris in 1911 12 that a son given away in adoption succeeded in the family of his natural father if he had no brothers though the High Court did not notice this part of the answer in the riwaj i am of 1911 12.
The conclusion therefore at which we arrive is that amongst Brahmins and (1) 1879 P.R. No. 43 476 Khatris of Amritsar district, a son given away in adoption can succeed to the property of his natural father only if there is no other son of the natural father; if there is another son he cannot succeed.
Now let us see how this proposition works out in the present case.
In this case Munshi Ram was claiming to succeed not to the property of Hans Raj, his natural father, but, to the property of Nanak Chand his natural grandfather.
If the case was for succession to the property of the natural father, namely, Hans Raj, the custom might have favoured Munshi Ram, for Hans Raj had no other son and Munshi Ram would thus have succeeded to the property of Hans Raj.
But Hans Raj, having died in the lifetime of his father (Nanak Chand), never succeeded to the property of his father.
The High Court, however, thought that on the principle of representation Munshi Ram stepped into the shoes of Hans Raj and therefore was entitled to succeed to the estate left by Nanak Chand as his father would have succeeded if he had been alive at the time of the death of Nanak Chand.
But if Munshi Ram is to succeed by the application of the principle of representation it would follow that Munshi Ram would really be deemed to be Hans Raj at the time of the death of Nanak Chand.
In that case the position would be that Nanak Chand would have died leaving two sons, namely, Salig Ram and Munshi Ram in the guise of Hans Raj.
But Munshi Ram having been adopted away and there being another son of Nanak Chand, even the custom recorded in para.
48 would exclude Munshi Ram because then there would be a brother of Munshi Ram alive in the family of Nanak Chand and this brother would succeed in exclusion of Munshi tam who would be representing his father.
The argument on behalf of Munshi Ram is that though for the purpose of representation Munshi Ram would be treated as if he stood in the shoes of his father, the representation could not go further and it could 'not be held that there were two sons of Nanak Chand living it the time of his death, one of whom in the guise of Munshi Ram was adopted away.
We cannot accept this 477 argument; and if Munshi Ram is to succeed on the principle of representation that principle must be fully worked out and he must for all intents and purposes be deemed to be Hans Raj.
As the person who is deemed to be Hans Raj was adopted away and has a brother in the shape of Salig Ram he would not succeed even under the custom recorded in para.
48 of Rattigan 's Digest.
The position therefore is that neither under Hindu law nor under the custom recorded in para.
48 can Munshi Ram succeed to the property of Nanak Chand.
We therefore allow the appeal and set aside the decree of the courts below and dismiss the suit of the plaintiff respondent so far as the property of Nanak Chand is concerned.
In the circumstances we also order the parties to bear their own costs throughout as the High Court did.
Appeal allowed.
[/INST]M, a Hindu belonging to the Brahmin community in the Amritsar District of Punjab, instituted a suit for the possession of a half share in the property left by his natural paternal grandfather.
His father had predeceased him, but another son of his grandfather was alive.
He had been adopted away in a different family but he claimed that according to the custom of his community in the district he was entitled to get his share in the estate of his natural grandfather.
The based his claim on the principle of representation that he, stepped into the shoes of his natural father.
Held, that under section 5 of the , the law applicable to Hindus in Punjab in respect of questions regarding succession and other matters referred to in that section, is Hindu law in the first instance, but where a custom different from Hindu law is proved then the rights of the parties would be governed by that custom; and whosoever asserts a custom at variance with Hindu law has to prove it, though the quantum of proof required in support of the custom which is general and well recognised may be small while in other cases of what are called special customs the quantum may be larger.
Held, further, that in the Amritsar district of Punjab amongst Brahmins and Khatri s, a son given away in adoption can succeed to the property of his natural father if there is no other son of the natural father, but if there is another son he cannot succeed.
Held, also, that in the present case neither under Hindu law nor under the customary law of Punjab could M succeed to the property of his natural grandfather.
</s>
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<s>[INST] Summarize the judgementAppeals Nos. 116 to 125 of 1961.
Appeals by.
special leave from the judgment and decrees dated March 4, 1955, of the former Andhra Pradesh High Court, Guntur, in section T. Appeals Nos.
83,85 88,90,91 and 119 121 of 1954.
M. C. 'Setalvad, Attorney General for India, R. Ganapathy Iyer, V. Sureshan and G. Gopalakrishnan, for the appellants (in C.As.
116 119 of 61) aid the respondents (in C.As.
120 125 of 1961).
282 A.V. Viswanatha Sastri, V. Yedantachari and T.V.R. Tatachari, for respondents 1 to 5 (in C.A. No. 116/61) and respondent No. 1 (in C.As.
Nos. 117 119/61) and the appellants in C.A. Nos.120125/61.
K.Bhimasankaram and P. D. Menon, for respondent No. 2 (in C.A.Nos.
117 119/61).
November 19.
The judgment of the Court was delivered by RAGHUBAR DAYAL, J.
These appeals arise out of the order of the Tribunal appointed under section 8 of the Madras Estates (Abolition and Conversion into Ryotwari) Act, 1948 (Madras Act XXVI of 1948), hereinafter called the Act, apportioning the advance compensation given and interim payments made in connection with the vesting of the Venkatagiri Estate in the Government of Madras as a result of a notification issued under sub section
(4) of section 1 of, the Act from the notified date, i.e., September 7, 1949.
The Act received the assent of the Governor General on April 2, 1949 and some of its sections, including sections 4 and 8, mentioned in sub section
(4) of section 1, came into force at once.
The other sections came into force with respect to the Venkatagiri Estate from the notified date.
With effect from the notified date, i.e., September 7, 1949, the entire Venkatagiri Estate stood transferred to the Government and vested in it by reason of section 3(b) of the Act.
283 Section 39 provides for the Director of Settlements to determine the basic annual sum in respect of the estate and also the total compensation payable in respect of the estate, in accordance with the provisions of the Act.
Section 54 A provides that the Government shall estimate roughly the amount of compensation payable in respect of the estate and deposit one half of that amount within six months from the notified date in the office of the Tribunal as advance payment on account of compensation.
(2) of section 50 provides for the deposit of interim payments by the Government during the period between the notified date and the final determination and deposit of the compensation payable in respect of the estate.
In respect of the Venkatagiri Estate, the Government deposited Rs. 12,11,419/ as and by way of advance payment of compensation, after deducting Rs. 7,28,500/ payable to the Government by the Estate for peishkush out of the sum of Rs. 19,39,919 8 0, half of the estimated amount of compensation payable.
The Government also deposited as interim payment Rs. 1,55,194/ for each of the Fasli years 1359 to 1362 F.
It is the distribution of these amounts in deposit as advance payment of compensation and interim payments, which is the subject matter for determination in these appeals.
To understand the various claims for payment out of these deposits, the following genealogical table will be helpful: 284 KUMARA YACHENDUR VARU | | | | Rajagopala Krishna Raja Venkata Krishna Yachendra(Deacsed) Yachendra (Deacsed) | | | | Rajagopala Krishna Raja V. Kumara Krishna Yachendra Yachendra (dead).
(Petitioner in O.P. No. 392 of 1950) | Petitioner | | | | | | | | Raja V. Venkata Raja V. Rama Raja Venkata | Krishna Krishna Rajagopala | Yachendra R.10 Yachendra Krishna Yachendra | O.P.
R.11 O.P. R.12 O.P. | No. 382/50 384/50 | | | | | | vegna Kumara Raja Venkata Rajagopala Krishna Krishna R 3.
R.4 O.P. 256/50 | | | | | Rajagopala Krishna Gopal Krishna Yachendra R 6.
| | | | Son Unnamed R 8.
Son Unnamed R 9. 285 | | Raja Maddukrishna Raja Venugopala Yachendra Krishna Yachendra (Died Issueless) | | | | Raja V. Rajeswara Rao Raja Maheswara Rao (R 14) (R 15) | | Venkata | | Gopala Minor Madanagopal Died Krishna (R 16 O.P. (R 15) No. 385 of 50) 3/50.
| | vaneethu R O.P. 3/50 286 The Venkatagiri Estate is an ancient estate in North Arcot and the necessary history of the estate for the purposes of this case is contained in the document Exhibit A 1 with which we now deal.
Kumara Yachendra Bahadur Varu, who tops the genealogical table noted above and his four sons mentioned therein, are parties to this document.
Kumara Yachendra Bahadur Varu represents also his minor son Venugopala Krishna Yachendra.
The document recites that the estate had been made over in 1878 to Rajagopala Krishna Yachendra, the eldest of the four brothers, by their father Kumara Yachendra Bahadur Varu, the then Rajah, as he wanted to devote himself to offering prayers to God for obtaining salvation.
He was said to be the sole heir to the estate, as Venkatagiri Zamindari was an impartible estate and succession to it was governed by the rule of lineal primogeniture.
In 1889, two of the brothers, Venkata Krishna Yachendra ' and Muddukrishna Yachendra, expressed a desire for the partition of the estate.
The then Rajah, i.e., Rajagopala Krishna Yachendra, the eldest brother, asserted that it was not liable for partition.
The four brothers then consulted their father and he told them : "that the Venkatagiri Zamindari was originally acquired by the valour of our ancestors in warfare, that the Zamindari is ancient, that it is an Impartible Estate which has to pass in the order of primogeniture, that at the time when the Sannad Istimdar Milk was given to the Raja of Venkatagiri who was ruling at the time of the permanent settlement th e Peshkush was settled for this Venkatagiri Samasthanam on the amount which was being paid as tribute and on the entire expenses relating to military assistance that was to be rendered lo the Nawab 's government which was in power previously that for this reason this Venkatagiri Samasthanam is not at all partible that the 287 immovable properties relating thereto and also other immovable properties acquired with the income of the said Samasthanam are not liable for partition that this is his opinion in regard to immovable properties. .
The father suggested partition of certain other property.
The terms of the final settlement between the father and his four sons are then noted.
They may be briefly mentioned.
(1) As the Venkatagiri Estate is an Impartible Estate and it passes to the eldest son by the rule of lineal primogeniture, the said Estate, the immovable properties pertaining to it and other immovable properties acquired with the income derived from the said Estate will be enjoyed by the Rajah, the eldest brother, and after his death his sons and grandsons and so on in succession shall enjoy, always the eldest male being the heir.
(2) If in the line of the said Rajah, his natural sons or adopted so s do not have male issue and that line stops short, then the properties shall be enjoyed by him who is the nearest heir and who is also the eldest to whom the impartible properties of the family pass according to law and custom and the same shall be enjoyed by his successors.
(3) The said Estate, all the properties pertaining to it, the title, power, privileges, all these shall be enjoyed fully and with all powers according to law and custom by the respective individuals who would be ruling at the respective periods subject to the condition of payment of allowances to other members of the family from the income derived from the Estate and from the properties in a manner befitting their respective status.
(4) The allowances were settled as follows Each of the brothers was to get Rs. 1,000/ per mouth 288 for the rest of his life.
After the death of each of these brothers, his male heir would continue to get this allowance of Rs. 1,000/ per month.
This amount of Rs. 1,000/ would be distributable between such male heirs and their male issues, according to Hindu Law.
If the male member died without leaving a natural son or an adopted son, the allowance was to pass the nearest agnates of the same branch according to Hindu Law and in case he left a wife or wives who had to be paid maintenance, their maintenance would be a liability on such agnate.
It was further provided that if any of the three lines of the family ceased for want of male issue, i.e., whether natural or adopted son, then subject to the condition that the wife or wives of the surviving male member of that branch who dies last shall be paid for their life time as maintenance a sum of Rs. 500/ being one half of the entire allowance of Rs. 1000/ that was being paid to the said male member, the allowance which was being paid to that branch would entirely cease.
This document has been acted upon.
In 1904, the Madras Impartible Estates Act, 1904 (Act 11 of 1904) came into force.
The Venkatagiri Estate was included in the Schedule of that Act and had to be deemed to be an impartible estate in view of section 3 of that Act.
Section 9 of that Act mentioned the persons entitled to maintenance out of the impartible estate, where for the purpose of ascertaining the succession to the impartible estate the estate had to be regarded as the property of a joint Hindu family.
In view of section 66 of the Act the Madras Impartible Estates Act of 1904 is deemed to have been repealed in its application to the Venkatagiri Estate with effect from the notified date.
The expression 'impartible estate ' in the Act means an estate governed immediately before the notified date by the Madras Impartible Estates Act, 1904 and therefore applies to this estate.
289 section 41 of the Act provides for the compensation to be deposited in the office of the Tribunal.
Section 42 provides for the; filing of claims to the compensation before the Tribunal by persons claiming any amount by way of a share or by way of maintenance or otherwise and by creditors.
By section 43, the tribunal is to inquire into the validity of the claims and determine the persons who, in its opinion, are entitled to the compensation deposited and the amount to which each of them is entitled.
Section 44 provides that as a preliminary to the final determination, the Tribunal shall apportion the compensation among such persons whose rights or interests in the estates stood transferred to the Government, including persons who are entitled to be maintained from the estate and its Income, as far as possible, in accordance with the value of their respective interests in the estate.
Its sub section
(2) provides how the value of those interests shall be ascertained, and says that in case of an impartible estate referred to in section 45, the ascertainment shall be in accordance with the provisions contained in that section and in such rules, not inconsistent with that section, as may be made by the Government in that behalf.
Section 45 is the main section for our purpose and may be quoted : "45.
(1) In the case of an impartible estate which had to be regarded as the property of a joint Hindu family for the purpose of as certaining the succession thereto immediately before the notified date, the following pro visions shall apply.
(2) The Tribunal shall determine the aggregate compensation payable to all the following persons, considered as a single group : (a) the principal landholder and his legitimate sons, grandsons, and great grandsons in 290 the male.
line living or in the womb on the notified date including sons, grandsons and great grandsons adopted before such date (who are hereinafter called 'sharers ') ; and (b) other persons who, immediately before the notified date,were entitled to maintenance out of the estate and its income either under section 9 or 12 of the Madras Impartible Estates Act, 1904, or under any decree or order of a Court, award, or other instrument in writing or contract or family arrangement, which is binding on the principal landholder (who are hereinafter called 'maintenance holders '): Provided that no such maintenance holder shall be entitled to any portion of the aggregate compensation aforesaid, if before the notified date, his claim for maintenance, or the claim of his branch of the family for maintenance, has been settled or discharged in full.
(3) The Tribunal shall next determine which creditors, if any, are lawfully entitled to have their debts paid from and out of the assests of the impartible estate and the amount of which each of them is so entitled; and only the remainder of the aggregate compensation shall be divisible among the sharers and maintenance holders as hereinafter provided.
(4) The portion of the aggregate com pensation aforesaid payable to the maintenanceholders shall be determined by the Tribunal and notwithstanding any arrangement already made in respect of maintenance whether by a decree or order of a Court, award or other instrument in writing or contract or family arrangement, such portion shall not exceed 291 one fifth of the remainder referred to in sub section (3), except in the case referred to in the second proviso to section 47, sub section (2).
(5) (a) The Tribunal shall, in determining the amount of the compensation payable to the maintenance holders and apportioning the same among them, have regard, as far as possible, to the following considerations, namely: (i) the compensation payable in respect of the estate ; (ii) the number of persons to be maintained out of the estate (iii) the nearness of relationship of the person claiming to be maintained; (iv) the other sources of income of the clai mant; and (v) the circumstances of the family of the claimant.
(b) For the purpose of securing (i) that the amount of compensation payable to the maintenance holders does not exceed the limit specified in sub section (4) and (ii) that the same is apportioned among them on an equitable basis, the Tribunal shall have power, wherever necessary, to re open any arrangement already made in respect of maintenance, whether by a decree or order of a Court, award, or otherinstrument in writing or contract or family arrangement.
(6) The balance of the aggregate compen sation shall be divided among the sharers, as if 292 they owned such balance as a joint Hindu family and a partition thereof had been effected among them on the notified date," Rajah Velugoti Kumara Krishna Yachendra, appellant in Appeal No. 117 of 1961, hereinafter called Krishna Bahadur, filed Original Petition No. 2300 of 1953 before the 'Tribunal.
Three of his sons Ramakrishna Yachendra, Rajagopala Krishna Yachendra and Movva Gopala Krishna Yachendra, appellants in Civil Appeals Nos. 118, 119 and 116 of 1961, respectively, filed separate petitions.
By their applications they raised the contentions that they were entitled to an amount in the compensation as sharers, as the impartible estate lost its character as such from the notified date and that the compensation payable with respect to their estate became partible and that in any case, they were entitled to the amount as creditors.
It was further contended that the provisions of section 45 of the Act were ultra vires the State Legislature and were discriminatory and so void and that the maintenance amount be determined with respect to the amount of compensation and not with respect to the amount of compensation minus the amount of peishkush which was payable by the estate to the Government.
None of these contentions was accepted by the Tribunal or by the Special Tribunal constituted in accordance with section 21 of the Act for bearing appeals against the orders of the Tribunal.
The Tribunal fixed Rs. 75,000/ as the amount payable to Krishna Bahadur 's branch out of the sum of Rs. 12,11,419/ deposited as advance payment of compensation and further fixed the ratio of the value of the interests of Krishna Bahadur and the two brothers of the present Rajah, in the 1/5th of the advance compensation, at 75:75:92.
The amounts 293 deposited as interim Payment were to be distributed in the same, ratio.
The present Rajah, Sarvagna Kumara Krishna, had urged before the 'tribunal that the amount of maintenance to be paid to Krishna Bahadur 's branch should be calculated on a different basis which, in brief, may be said to be that the amount to which he be; held entitled out of the compensation should bear the same proportion to the total compensation as the monthly allowance payable to him under the document Exhibit A 1 bears to the income of the Estate in 1889 when that allowance of Rs. 1,000/per month was fixed.
This contention also did not find favour with the Tribunal or the Special Tribunal on appeal.
The Rajah has therefore filed Civil Appeals Nos.
120 to 123 of 1961.
He has also filed two appeals Nos. 124 and 125 with respect to the interim payments made so Krishna Bahadur 's branch for the Fasli years 1359 and 1360 which were apportioned in accordance with the same principle which the Tribunal had adopted for the distribution of the maintenance allowance out of the advance compensation.
The points urged for the appellants in appeals Nos. 116 to 119 are (1) Venkatagiri Estate was, impartible by custom that impartibility was recognized when disputes arose in 1889, that impartibility continued under the Madras Impartible Estates Act of 1904 but ceased when the Estate vested in the Government on September 7, 1949; (2) In these circumstances, the compensation Will not bear the character of impartibility as the property,, became the property of the joint family, the coparcenary having continued all through 294 (3)Section 45 and other provisions of the Act are ultra vires the State Legislature for want of legislative competence inasmuch as the said Legislature had no power to enact a law disturbing the rights of a joint family and also because the provisions of section 45 are discriminatory and offend article 14 of the Constitution as they provide for the maintenanceholders to get 1/5th out of the compensation while the proprietor and his sons are to get 4/5ths out of it after satisfying the claims of the creditors; (4) The appellants are not maintenanceholders, but creditors; (5) The amount of peishkush payable by the Venkatagiri Estate to the Government was not to be deducted from the compensation when calculating maintenance amount payable to the maintenance.
holders.
Now, the amount of peishkush payable to the Government had to be deducted out of the amount to be deposited under sub section (1) of section 54 A in view of the provisions of its sub section
(2) which provides that from the amount to be deposited under sub section
(1) the Government shall be entitled to deduct one half of all moneys, if any, due to them in respect of peishkush.
Sub section
(4) of section 54 A authorizes the Tribunal, after such enquiry as it thinks fit, to apportion the amount deposited in pursuance of that section, among the persons mentioned in that sub section as far as possible in accordance with the value of their respective interests and further provides that the provisions of sections 42 to 46 (both inclusive), shall apply mutatis mutandis in respect of the amount so deposited.
It is true that the peshkash was a payment which the holder of the Estate had to make to the Government out of the income of the estate and that any arrears of peshkash remain a liability on the 295 estate.
It was in view of this fact that s.55(1) of the Act which takes away the right of any land holder to collect any rent which had accrued to him from any ryot before the notified date and was outstanding on that, date empowers the manager appointed under section 6 to collect such rent and to pay the balance, if any, after making certain deductions specified in the section, including any arrears of peshkash to the landholder.
The real compensation which is to be paid by the Government on the vesting of the estate must be equal to the amount of the value of the estate as such, minus the liabilities of the estate.
What is to be distributed between the various persons entitled to the compensation must be the net amount and not the theoretical compensation for the estate as such.
In this view of the matter too, the share of the maintenance holders will have to be calculated in the amount of compensation deposited, i. e., the amount of compensation minus the permissible deductions including peshkash.
It is therefore clear that the Tribunal could not have ignored the deduction of peshkash from one half of the estimated amount of compensation payable in respect of the estate and had to apportion the amount deposited after taking into consideration such deduction.
The contention for the appellants that the amount to be considered for calculating the share of the maintenance holders should have been taken at Rs. 19,00,000/ odd and not at Rs. 12,00,000/ odd, the actual amount of the deposit, is not sound.
The next question is whether the allowance is a debt owed by the Rajah landholder to his brothers to whom the allowance was to be paid.
It might have been so only if it was postulated that the Rajah had purchased the share of the other members of the family and was paying the sale price in the form of an allowance.
This is, not what the document Exhibit A 1 recites.
There is nothing in it to indicate 296 that the brothers of the Rajah to whom the estate had been made over by their father claimed a share in the estate after they had been told by their father that the estate was impartible.
The sale price is normally fixed while the amount of allowance to be payable is an indefinite quantity depending upon length of time through which each of the brother 's branches continues to have a male member.
The word 'allowance ' appears to have been used either as a dignified expression preferable in form to that of 'maintenance ' or due to the idea that the word ,maintenance ' is to be used appropriately only for the amounts to be paid to female members of the family in certain circumstances.
The allowance referred to in the deed, Exhibit A. 1, as payable to Kishen Chander, father of Krishna Bahadur, is not akin to a debt owed by the Rajah to Kishen Chander.
It is not made payable on account of certain loans taken by the Rajah, but is payable for maintenance, as the estate being impartible the other members of the family had a reasonable claim to maintenance.
The only ground urged in support of the contention that the allowance is not an allowance for maintenance is that the word 'maintenance ' is used in the document A 1 in connection with the amount payable to the widows.
A different terminology in referring to the amounts to be paid to Kishen Chander and his brothers does not change the character of the payment.
The widows were to get a share out of the same allowance when there was no male member in the particular family.
That amount cannot be a debt so long as it was payable to a male member and a maintenance when payable to a female member.
Kishen Chander himself 'referred to this amount as maintenance in earlier proceedings.
We therefore hold that the view expressed by the Courts below with respect to the nature of this allowance is correct.
297 The validity of section 45 of the Act on the ground of the ' competence of the Legislature of the State was not questioned in the High Court.
The contention, however, is that the Act was made by the State Legislature by virtue of Entry 21 in List II of the Seventh Schedule to the Government of India Act, 1935, which reads: "Land, that is to say, rights in or over land, land tenures, including the relation of land lord and tenant, and the; collection of rents transfer, alienation and devolution of agricultural land ; land improvement and agricultural loans ; colonization; Courts of Wards; Encumbered and attached estates ; treasure trove.
" The question of succession to the impartible estate does not come under this Entry and comes under Entry No. 7 of List III of the Seventh Schedule to the Government of India Act which reads : "Wills, intestacy, and succession, save as regards agricultural land.
" The reply for the respondent is that the Act can come within either item No. 9 or item No. 21 or both, of List II ' of the Seventh Schedule to the Government of India Act, 1935.
We are of opinion that the Act does not (teal with the succession to impartible estates.
The Act acquires the impartible estate which vests in the Government on the notified date.
The rights of the and holder in the estate cease on that date.
The Act was enacted by the State Legislature by virtue of item No. 9, List II, Seventh Schedule to the Government of India Act which reads: "Compulsory acquisition of land.
" The Act is not ultra vires the State Legislature Theattack on the validity of section 45 of the Act on 298 the ground of its contravening the provisions of Art 14 of the Constitution is not open to the appellants in view of article 31B which provides inter alia that not of the Acts specified in the Ninth Schedule nor any of the provisions thereof shall be deemed to be void or ever to have become void on the ,round that the Act takes away or abridges any of the rights conferred by any provisions of Part III.
Article 14 is in that Part of the Constitution.
The Act is mentioned at item No. 10 in the Ninth Schedule.
We therefore hold that the provisions of section 45 of the Act are not void.
The next question for determination is whether the appellants should have got share in the compensation as "sharers ' on account of the partible character of the estate reviving on the notified date as a result of the repeal of the Impartible Estates Act, 1904.
We are concerned in these appeals with the distribution of advance compensation given and interim payments made in accordance with the provisions of the Act.
We have held the relevant provisions to be valid.
Therefore, the appellants can only ask for their share of the compensation in accordance with those provi sions.
We do not consider it necessary to decide the question whether any property ceased to be impartible after the notified date and understand that an appeal in which the question directly arises is pending against a judgment in a civil suit holding that the buildings to which sub section
(4) of section 18 applied were impartible and were owned by the Rajah.
Even if the appellants had any right in the estate, (though we do not so decide), that right ceased on the notified date in view of the provisions of section 3 of the Act and thereafter they are entitled to such rights and privileges only as are recognized or conferred by or under the Act.
Section 3 of the Act provides the consequences of notification of the estate.
The relevant portions of section 3 are : " x x x x 299 (b) .
the entire estate. shall stand transferred to the Government and vest in them. . (c) all rights and interests created in or over the estate before the notified date by the principal or any other land holder, shall as against the Government cease and determine x x x x x (e) the principal or any other landholder and any other person, whose tights stand transferred under clause (b) or cease and determine under clause (c), shall be entitled only to such rights and privileges as are recognized or conferred on him by or under this Act.
, x x x x x (g)any rights and privileges which may have accrued in the estate, to any person before the notified date, against the principal or any other landholder thereof, shall cease and determine, and shall not be enforceable against the Government or such landholder, and every such person shall be entitled only to such rights and privileges as are recognized or conferred on him by or under this Act. ' The estate was impartible up to the moment it vested in the Government on the notified date.
Whatever be the nature of the compensation payable, the distribution of the compensation between the persons who had an interest in the estate would be in accordance with the provisions of sub section
(2) of section 45 which defines "sharers ' to be the principal landholder and his legitimate sons, grandsons and the great grandsons in the main line living, or in the womb on the notified date, including sons, grandsons and great grandsons adopted before such date.
The appellants do not come under any of the persons mentioned in this 300 clause and therefore they cannot get, compensation as "sharers".
The result of our findings is that all the four appeals nos.
116 to 119 of 1961 fail.
The dispute in the remaining six civil appeals relates to the principle on which the amounts of maintenance payable to the persons entitled to it are to be calculated.
The contention is that when the net income of the estate in 1889, was about Rs ' 6,00,000/ a year, the allowance payable to each brother was Rs '.
1,000/ per month and that therefore the value of the interest of each brother in the estate came to about 1/50th of the income.
The amount payable to him now, it is urged should% bear the same proportion to the basic annual sum which is first calculated under the provisions of the Act and later capitalised to obtain the amount of compensation payable for the estate.
The relevant provisions in connection with the apportionment of the maintenance allowance applicable to impartible estates are to be found in section 45 of the Act, Sub section (3) provides for determining the amount to which the creditors of the holder ' of the estate are entitled out of the assets of the estate.
The amount due to them is first to be deducted from the compensation and out of the balance the maintenance holders as a body can have an amount equal to 1/5 th and no more.
If the amount due to them comes to less than 1/5th they will get it as they had been getting in the past.
If the , amount exceeds 1/5th of the aforesaid balance,, the tribunal has the authority, to re open any arrangement previously made in respect of maintenance and re assess the amount to paid to each maintenance holder, keeping in regard the provisions of sub section (5) There is nothing in this sub section which authorises the Tribunal to calculate the incidents of the amount of compensation on the income of the estate at the time it was fixed.
Even in the present case, the amount of 301 maintenance allowance was not.
fixed as a certain proportion of the net income of the estate but was fixed, according to document A 1, after considering several factors affecting the question as is apparent from the following statement in ' the document "The aforesaid mediator considered in full the status of all the claimants.
the status and dignity, of the Estate and all the other matters deserving consideration and settled that the said Rajha.
Rajagopala Krishna Yachendra. . of Venkatagiri should pay the allowances as mentioned below.
" We are therefore of opinion,.
that the Special Tribunal had held rightly that the apportionment of the advance payment of compensation and the interim payment had been made in accordance with the provisions of the Act.
In view of what we have stated above, we dismiss all the appeals with costs, one :hearing fee for Civil Appeals Nos.
116 to 119 and one hearing fee for C I Appeals Nos. 120 to 125.
Appeals dismissed.
[/INST]A Receiver authorised and appointed by a Court to collect the debts due to the plaintiff respondent instituted a suit against the appellant firm and its alleged partners for the recovery of the price of tobacco and interest thereon.
The right of the receiver to institute a suit in his own name was challenged by the appellant.
Thereupon the respondent firm amended the Plaint by describing the plaintiff as "M/s. T. R. & Co., represented by I. Surayanarayana Garu receiver appoin.
ted in O.S. 275 of 1948 on the file of the District Munsiff 's Court Guntur.
" The appellant firm amended the written statement and contended that the amendment of the plaint was timebarred, that it did not cure the initial defect in the suit and that consequently, the suit was barred by limitation.
The trial court dismissed the suit on the ground that Suryanarayana was not entitled to institute a suit in his capacity as Receiver, that the amendment of the plaint was beyond time and that the suit was therefore time barred.
On appeal the High 996 Court held that the Receiver was entitled to institute the suit, that at the most there was a misdescription of the plaintifffirm in the cause title of the suit which could be corrected any time, that consequently the suit was within time and that the plaintiff was entitled to a decree with interest from the date of delivery of the goods till realization.
Held, that a Receiver invested with full powers to administer the property which is custodia legis or who is expressly authorised by the court to institute a suit for collection of the assets is entitled to institute a suit in his own name provided he does so in his capacity as a Receiver.
His function cannot be limited merely to the preservation of the property and it is open to a court, if occasion demands, to confer upon him the power to take such steps including instituting suits in the interest of the parties themselves.
The suit as originally instituted, was thus perfectly competent.
The High Court rightly held, that where there is a case of misdescription of parties it is open to the court to allow an amendment of the plaint at any time and the question of limitation would not arise in such a case.
Jagat Tarini Dasi vs Naba Gopal Chaki (1907) r. L. R. , relied on.
Held, further that this court does not interfere with the concurrent findings of the courts below on a pure question of fact, unless there are exceptional circumstances or unusual reasons which induce it to re examine the entire evidence.
Srimati Bibhabati Devi vs Kumar Ramendra Narayan Boy, (1946) L. R. 73 1.
A. 246 and Sriniwas Ram Kumar vs Mahabir Prasad, ; , referred to.
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<s>[INST] Summarize the judgementAppeal No. 1082 of 1967.
Appeal from the judgment and order dated March 7, 1967 of the Delhi High Court in Company Appeal No. 3 of 1967.
A. N. Khanna and Harbans Singh, for the appellant.
P. C. Khanna and Maharaj Krishan Chawla, for the respon dent.
The Judgment of the Court was delivered by Shah, J.
The appellants private limited Company is engaged in the manufacture of electric conduit pipes.
The respon dent who is a director of the Company presented a petition in the High Court of Delhi under sections 433 and 439 of the , for an order for compulsory winding up of the Company.
The respondent claimed that it was "just and equitable" within the meaning of section 443(f) of the , to make an order for compulsory winding up, because one of the three factories of the Company had been closed, that the accounts of the Company were not being shown to the respondent, that no meeting of the Company had been held, no balance sheet had been prepared and a letter of resignation purported to be signed 430 431 by the respondent had been forged.
On July 18, 1966, Capoor, J., directed that notice of the petition be issued to the appellant Company.
The order has not been formally drawn up, and it is not clear whether by that order it was intended to call upon the Company to show cause why the petition should not be admitted, or that by the order the petition was admitted and notice under r. 96 of the Companies (Court) Rules, 1959 was issued.
The appellant Company filed its reply controverting the allegations made by the respondent.
The Company also filed an application that the winding up petition filed by the respondent be taken off the file and be dismissed and that the petition in the meantime be not advertised.
H. R. Khanna, J., held that the appropriate remedy of the respondent on the allegations of mismanagement of the affairs of the Company and oppression of the minority shareholders by the group of Anandi Lal was to file a petition under sections 397 and 398 of the .
The learned Judge further held that the petition for winding up was instituted with a view "to unfairly prejudice the interests of the shareholders of the Company", respondent having set up a rival factory in the name of his son for manufacturing electric conduit pipes.
The learned Judge directed that the petition be not advertised and be.
dismissed.
In appeal against the order passed by H. R. Khanna, J., the High Court of Delhi held that under the Companies (Court) Rules, 1959, once a petition is admitted to the file, the Court is bound forthwith to advertise the petition.
The company challenges that order in this appeal.
Rule 96 of "The Companies (Court) Rules, 1959" framed by this Court provides : "Upon the filing of the petition, it shall be posted before the Judge in Chambers for admission of the petition and fixing a date for the hearing thereof and for directions as to the advertisement to be published and the persons, if any, upon whom copies of the petition are to be served.
The Judge may, if he thinks fit, direct notice to be given to the company before giving directions as to the advertisement of the petition.
" Rule 24 which relates to advertisement of petitions provides "(1) Where any petition is required to be advertised, it shall, unless the Judge otherwise orders, or these, Rules otherwise provide, be advertised not less than fourteen days before the date fixed for hearing, in one issue of the Official Gazette of the State or the Union Territory concerned, and in one issue each of a daily newspaper in the English language and a daily newspaper in the regional language circulating in the State or the Union Territory concerned, as may be fixed by the Judge.
432 (2) Except in the case of a petition to wind up a company, the Judge may, if he thinks fit, dispense with any advertisement required by these Rules.
" When a petition is filed before the High Court for winding up of .a company under the order of the Court, the High Court (i) may issue notice to the Company to show cause why the petition should not be admitted; (ii) may admit the petition and fix a date for hearing, and issue a notice to the Company before giving directions about advertisement of the petition; or (iii) may admit the petition, fix the date of hearing of the petition, and order that the petition be advertised and direct that the petition be served upon persons specified in the order.
A petition for winding up cannot be placed for hearing before the Court, unless the petition is advertised that is clear from the terms of r. 24(2).
But that is not to say that as soon as the petition is admitted, it must be advertised.
In answer to a notice to show cause why a petition for winding up be not admitted, the Company may show cause and contend that the filing of the petition amounts to an abuse of the process of the Court.
If the petition is admitted, it is still open to the Company to move the Court that in the interest of justice or to prevent abuse of the process of Court, the petition be not advertised.
Such an application may be made where the Court has issued notice under the last clause of r. 96, and even when there is an unconditional admission of the petition for winding up.
The power to entertain such an application of the Company is inherent in the Court, and r. Nothing in these Rules shall be deemed to limit or otherwise affect the inherent powers of the Court to give such direction or pass such orders as may necessary for the ends of justice to prevent abuse of the process of the Court", iterates that power.
In in re. A. Company(1) it was held that if the petition is not presented in good faith and for the legitimate purpose of obtaining a winding up order, but for other purpose such as putting pressure on the Company, the Court will restrain the advertisement of the petition and stay all further proceedings upon it.
We may state that the High Court of Punjab in Lord Krishna Sugar Mills Ltd. vs Smt.
Abnash Kaur(2) was right in ,observing that the Court in an appropriate case has the power to .Suspend advertisement of a petition for winding up, pending disposal of an application for revoking the order of admission of the petition, though we may hasten to state that we cannot agree H.R. Khanna,, J., was apparently satisfied that the petition was not a, bona fide petition and the respondent in presenting (1) (2) A.L.R. 1961 Punjab 505.
433 the petition was acting with ulterior motive and his attempt to obtain an order for winding up was "unreasonable".
Before the High Court directed that the petition for winding up be advertised,the High Court was bound to consider whether the view expressed by H. R. Khanna,, J., was right.
For reasons already set out, in our judgment, the High Court erred in holding that a petition for winding up must be advertised even before the application filed by the Company for staying the proceeding for the ends of justice, or to prevent abuse of the process of the Court.
The view taken by the High Court that the Court must, as soon as the petition is admitted, advertise the petition is contrary to the plain terms of r. 96.
Such a view, if accepted, would make the Court an instrument, in possible cases, of harassment and even of blackmail, for once a petition is ad vertised, the business of the Company is bound to suffer serious loss and injury.
The appeal is allowed.
The High Court has disposed of the appeal on a ground of procedure and has not considered whether the view of H. R. Khanna, J., that in the exercise of the inherent power for the ends of justice and for prevention of the abuse of the process of Court, the petition should not be advertised, is correct.
The case is therefore remanded with the direction that the High Court do deal with and dispose of the appeal according to law.
There will be no order as to its costs in this Court.
The costs in the High Court will be costs in this appeal.
Y.P. Appeal allowed.
[/INST]The property of a trust was sold in execution of a mortgage decree.
The trustees sought to set aside the sale under 0.
21, r. 89 of the Code of Civil Procedure, They deposited five per cent of the purchase money for payment to the auction purchaser and claimed that the mortgagee had agreed to give them time for payment of the mortgage amount, and has agreed in the meantime to abandon the application for execution.
The subordinate judge set aside the sale.
In appeal the District Court reversed that order holding that since the trustees failed to comply with r. 89 of 0. 21 requiring the judgment debtor to deposit in court for payment to the decree holder the amount specified in the proclamation of sale for the recovery of which the sale was ordered, the executing court had no jurisdiction to set aside the sale.
A single Judge of the High Court, in revision, set aside the order on the ground that the sale of the mortgaged property, which belonged to a public trust, without the sanction of the Charity Commissioner was prohibited by section 36 of the Bombay Public Trust Act and was on that account invalid.
The ,High Court remanded the case to the District Court.
In appeal to this Court, HELD:The order of the High Court should be set aside and that of the District Court restored.
(i)Transactions of mortgage, exchange or gift or lease of any immovable property in clauses (a) and (b) of section 36 of the Bombay Public Trusts Act contemplated to be made by the Trustees are voluntary transactions and in the absence of any clear provision in the Act, the expression 'Sale ' in cl.
(a) only means transfer of property by the trustees for a price and does not include a Court sale in execution of a decree.
[457F G] A suit to enforce a mortgage or a proceeding to enforce a mortgage decree against property belonging to a public trust is not a suit or proceeding in which a question affecting public religious or charitable purpose is involved within the meaning of section 56B of the Act and therefore it is not obligatory upon the court to issue notice to the Charity Commissioner.
[458C D] (ii) An order setting aside a Court sale in execution of a mortgage decree cannot be obtained under 0.
21 r. 89 of the Code of Civil Procedure by merely depositing five per cent of the purchase money for payment to the auction purchaser and persuading the decree holder to abandon the execution proceeding.
[459G H] 456 (iii)A Single Judge of a High Court is ordinarily bound to accept as correct judgments of Courts of coordinate jurisdiction and of Division Benches and of the Full Benches of his Court and of this Court.
Any reference to section 165 of the Evidence Act or the Oath of Office of a High Court judge is irrelevant and will not justify a judge in ignoring the rule relating to the binding nature of precedents.
Jaisri Sahu vs Rajdewan Dubey, ; Lala Shri Bhagwan vs Shri Ram Chand, ; ; Pinjare Karimbhai vs Shukla Hariprasad, ; Haridas vs Ratansey, ; and State 'of Gujarat vs Gordhandas,
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<s>[INST] Summarize the judgementiminal Appeal No. 32 of 1982.
From the Judgment and Order dated 1.10.1981 of the Delhi High Court in Criminal Misc.
(Main) No. 304 of 1980.
S.L. Chowdhary and Pradeep Misra for the Appellant.
Rakesh K. Khanna and R.P. Singh for the Respondent.
The following order of the Court is delivered: Even though the dispute between the parties came to this Court from an initial order passed under Section 145 of the Code of Criminal Procedure, this Court realising that the dispute was between close relatives in respect of their interests in certain properties which were also the subject matter in a Civil Suit No. 434/78 (Remand) of the Court of Sub Judge, First Class, Delhi, advised the parties to have the same resolved through an Arbitrator.
On the parties agreeing, this Court passed an order on September 5, 1986 recording the agreement to refer the dispute to arbitration and appointed Mr. Justice V.D. Misra, retired Chief Justice of the High Court of Himachal Pradesh, as the Sole Arbitrator.
The parties had agreed to deposit a sum of Rs. 3,000 each with the Arbitrator to meet with his expenses and remuneration subject to further directions that may be made in that behalf.
It was further directed that the learned Arbitrator will render a speaking award within four months.
In view of the said agreement, the appeal was allowed and the High Court 's impugned order was set aside.
It appears that thereafter one of the parties, namely, Jagdish Chander Bhatia, did not deposit the expenses with the Arbitrator and raised objection in regard to the arbitration proceedings on the plea that the property in dispute was proposed to be resumed by the Union of India.
In the meantime, it appears that the sole Arbitrator passed away and in his place Mr. Justice M.S. Gujral retired Chief Justice of the High Court of Sikkim, was appointed the Sole Arbitrator.
This Court did not approve of the conduct of Jagdish Chander Bhatia in not depositing the amount and 'in trying to avoid adjudication of the dispute through arbitration.
After this 54 order was passed on October 12, 1990 by which a further sum of Rs. 8,000 was directed to be deposited with the Arbitrator, subject to the Arbitrator deciding who should bear the cost, the newly appointed Arbitrator entered upon the reference and submitted his award on November 14, 1991.
This concluding part of his Award reads as under: "House No. 17 would entirely belong to Lachhman Das Bhatia whereas House No.18 would be jointly owned by Lachhman Das and Jagdish Chander.
Lachhman Das would have 76.50% share whereas Jagdish Chander would have 23.50% share in House No.18.
As House No.17 has entirely been given to Lachhman Das Bhatia in all fairness, Jagdish Chander Bhatia should give vacant possession of House No.17 to Lachhman Das Bhatia.
" The parties were directed to bear their own costs of the arbitration proceedings except that Jagdish Chander Bhatia had to pay Rs. 4,000 to Lachhman Das Bhatia as his share of the Arbitrator 's fees which he had initially failed to deposit.
Against this award, Jagdish Chander Bhatia (hereinafter called 'the objector ') has filed objections under Section 30 of the which provision reads as under: "An award shall not be set aside except on one or more of the following grounds, namely (a) that an arbitrator or umpire has misconducted himself or the proceedings; (b) that an award has been made after the issue of an order by the Court superseding the arbitration proceedings have become invalid under Section 35; (c) that an award has been improperly procured or is otherwise invalid.
" It was conceded by the learned counsel for the Objector that clause (b) would not be attracted.
His main submission was that the Arbitrator had misconducted himself, in that, he did not take into consideration several documents which were placed on record before him which support the Objector 's case and hence the Award was invalid.
He, therefore, partly relied on clauses (a) and (c) for setting aside the Award.
55 The documents to which the learned counsel for the objector invited our attention, are to be found in Vol.2 of the paper book placed before us.
These documents are 31 in number and they mainly relate to the rights and interests of the parties in properties situate in that part which now belongs to the Dominion of Pakistan.
Since they were refugees they had made certain claims under the law governing rehabilitation of displaced persons in respect of the properties left behind by them.
These documents show that the claim was sanctioned in the name of Punnu Ram Lachhman Das in respect of the properties left behind by the family.
On the strength of that claim, House No.18 was purchased in the said name.
The Arbitrator, however, came to the conclusion, as is evident from the discussion from paragraph 26 and onwards of the Award, that the property in question was purchased for Rs. 12,850 from the funds contributed by Punnu Ram and Lachhman Das, the former paying Rs. 9,233 and the latter Rs. 3,617.
This is the conclusion reached by the Arbitrator as is evident from paragraph 37 of the Award.
The share of the Objector was held to be 1/7th in the share of Punnu Ram, since deceased.
It was on this finding recorded by the Arbitrator that he passed the ultimate order extracted above.
The arbitrator has made a speaking award setting out his reasons for the conclusions reached by him.
He has thus complied with the direction of this Court given earlier.
On a perusal of the award, it becomes clear that the Arbitrator did not go into the rights and interests of the parties including the HUF in the properties left behind in the Dominion of Pakistan.
That was, in our opinion, not necessary because the fact that the claim was sanctioned in the name to the Punnu Ram Lachhman Das was never in dispute.
The short question, which the Arbitrator was required to consider, was as regards the title of the properties which were the subject matter of the reference which included the property purchased for Rs. 12,850 on the strength of that claim.
In dealing with that question the Arbitrator came to the conclusion that Punnu Ram and Lachhman Das had contributed the entire consideration of Rs. 12,850 and hence they were the owners of the property and on the death of Punnu Ram inheritance opened insofar as his share in the property was concerned and the Arbitrator came to the conclusion that the Objector was entitled to 1/7th out of the share of the deceased.
Since the contribution made for payment of the price was not equal, the Arbitrator allotted a larger share to Punnu Ram and consequently the Objector has got a share on the basis thereof.
Practically, all the documents included in Vol.2 relate to the interest of the 56 parties and their HUF in the properties left behind in the Dominion of Pakistan.
The learned counsel for the Objector then tried to take us into the rights and interests of the parties in those properties, but we declined to go into the same as we thought that the Arbitrator was right that he was called upon to decide the interest of the parties in Houses Nos. 17 and 18 alone which were the subject matter of the reference.
We are, therefore, of the opinion that the Arbitrator had not misconducted himself by refusing to enumerate those documents in Vol.2 in his award because he was bound by the scope of the reference which was limited to Houses Nos. 17 and 18 and not the properties left behind in the Dominion of Pakistan by the parties.
For this reason, we are of the opinion that there is no infirmity on the face of the award which would entitle us to exercise jurisdiction under Section 30 of the .
This Court pointed out in Food Corporation of India vs Joginderpal Mohinderpal & Anr., [1989] 2 SCC 347 that an award of an Arbitrator can only be interfered with or set aside or modified within the four comers of the procedure provided by the statute.
The Court must find out whether the Arbitrator has misconducted himself or there was any infirmity in the procedure, such as, the Arbitrator having travelled beyond the terms of the reference or there being an error apparent on the face of the award.
It is not misconduct on the part of an Arbitrator to come to an erroneous conclusion on a disputed issue.
In case of error apparent on the face of the award, the award can be set aside only if there is any proposition of law on which the award is based which is in conflict with law.
It must be demonstrated to the Court that the reasons given by the Arbitrator are so palpably erroneous in law that they have resulted in the Arbitrator taking a view which cannot be sustained in law.
To put it differently the Court does not sit in appeal and does not re assess the evidence.
Even if the Court feels that had it been left to it, it would have assessed the evidence differently that would not be a valid ground for setting aside the award.
In Hind Builders vs Union of India, [1990] 3 SCC 338, this Court pointed out that where on an interpretation of any contract or document, two views are possible and the Arbitrator accepts one view while the other view is more appealing it would not be open to the Court to interfere with the Award.
We, therefore, in the facts and circumstances of this case, see so reason to interfere with the award of the Arbitrator.
The Suit No. 434/78 pending in the Court of the Sub Judge, Delhi 57 was disposed of by that Court, and an appeal, being Civil Appeal No. 211 of 1979 (Jagdish Chander Bhatia vs Lachhman Das Bhatia) preferred on April 23, 1979 against that decree, is pending in the Court of the District Judge, Delhi.
We transfer that appeal to our file and make the Arbitrator 's award the rule of the Court.
The decree of the trial court is set aside and a decree in terms of the award will be drawn up in the appeal proceedings arising out of Suit No. 434/78.
We, however, do not make any order as to costs in the present proceedings.
N.P.V. Appeal disposed of.
[/INST]The suit premises was let out by the appellant landlord to the respondent on a monthly rent of Rs. 550 solely for residential purpose.
In a part of the premises, the respondent 's husband, a lawyer established his office and started using the same for that purpose.
Teh appellant landlord riled a petition before the Rent Controller seeking eviction of the respondent tenant.
The Rent Controller made an order of eviction of the respondent tenant on the ground of change of user under section 13(2) (II) (b), of the East Punjab Urban Rent Restriction Act, 1940.
The tenant 's appeal was dismissed by the appellate authority, against which a revision to the High Court was preferred.
The Single Judge of the High Court allowed the revision and set aside the eviction order, holding that the building let out as a 'residential building became a 'scheduled building ' by use of a part thereof as lawyer 's office by the tenants husband; and therefore, the ground of eviction was not available.
Hence this appeal by the landlord by special leave, contending that the ground of change of user contained in section 13(2) (II) (b) was clearly made out from the facts and the High Court erred In setting aside the order of eviction.
172 The respondent tenant submitted that the landlord waived the ground of change of user by acquiescence to use of a part of the premises as lawyer 's office; that the ground in section 13(2)(ii)(b) was not available unless the change of user was of substantial, if not the entire building and, therefore, mere use of a small part of the residential building as lawyer 's office does not constitute such change.
Allowing the appeal of the landlord, this court, HELD : 1.01.
Use of the building for a purpose other than that for which it was leased, without the written consent of the landlord is a ground of eviction.
Ile object dearly is that the parties must remain bound by the terms on which the building is let out, including the condition relating to Its use for the purpose for which it was leased.
In other words, breach of the covenant regarding the kind of user of the building let out is the ground of eviction contained in section 13(2) (ii) (b) of the East Punjab Urban Rent Restriction Act.
[177A B] 1.02.
If the change in user of the building is of the kind that it makes the residential building let out for residential purpose alone change its character and become a 'scheduled building ' as defined in section 2(h) of the Act without the written consent of the landlord, the ground of eviction under section 13(2) (ii) (b) is made out.
[177C] 1.03.
This test is fully satisfied In the present case and the order of eviction was made by the Rent Controller and affirmed by the appellate authority on this basis.
The High Court misconstrued the provisions to take the contrary view.
[177D] Telu Ram vs Om Parkash Garg , approved.
Sant Ram vs Rajinder Lal and Ors., ; Dr. Sewa Singh vs Smt.
Ravinder Kaur and another, , distinguished.
Even though a 'scheduled building continues to be a residential building as defined in section 2(g), a residential building of which even a part is used for a scheduled purpose, becomes and is called a 'schedule building when user of the building is significant or the criterion.
[176F] 2.02 Where user of a building is of significance, a distinction is made In the Act between a residential building which is not a scheduled building and 173 that which is a scheduled building.
This is so in section 4 of the Act dealing with determination of fair rent wherein fixation of rent is made on the basis of user and for that purpose a 'scheduled building ' is treated differently from a residential building which is not a scheduled building.
[176G]
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<s>[INST] Summarize the judgementCivil Appeal No. 1365 of 1968 From the Judgment and Decree dated the 8 12 66 of the Madras High Court in Appeal No. 609 of 1961.
K. N. Balasubrahmaniam and Miss Lily Thomas for the Appellant.
K. Jayaram for the Respondent.
The Judgment of the Court was delivered by JASWANT SINGH, J.
This is an appeal by certificate granted by the High Court of Judicature at Madras under Article 133(1) (a) and (b) of the Constitution of India against its judgment and decree dated December 8, 1966 in A. section No. 609 of 1961.
The facts culminating in this appeal lie in a short compass and may be briefly stated thus: Kota Venkatachala Pathy whose legal representatives are the respondents herein and Kota Narayanan, the appellant herein, were real brothers being the sons of one Kota Rangaswami Chettiar.
Together with their cousin Subramanyam Chettiar, the son of Kota Kuppuswami Chettiar, the brother of Kota Rangaswami Chettiar, they formed a joint family which was a trading one.
Prior to 1927, Subramanyam Chettiar was the manager and karta of the family.
After 1927 Kota Venkatachala Pathy took over the management of the family and its properties.
By registered deed dated May 29, 1929 (Exh.
A 1) a partition of joint family properties was effected between Subramanyam Chettiar on the one hand and Kota Venkatachala Pathy and his brother, Kota Narayanan, who was then a minor, on the other, each branch taking a half share.
As karta of the joint family.
Subramanyam Chettiar had, before November 20, 1927 incurred debts to the tune of Rs. 9,506/ from several creditors.
Five items of joint family properties detailed in Schedule D 1 to the deed of partition were earmarked for the discharge of the aforesaid debts and were given over to Kota Venkatachala Pathy who was made responsible for the discharge of the debts.
These debts were discharged by Kota Venkatachala Pathy before March 26, 1934.
On September 7, 1956, Kota Venkatachala Pathy brought a suit, being No. O. section 87 of 1956, in the Court of the Subordinate Judge of Vellore, North Arcot, for partition and separate possession of 3/4th of the properties set out in Schedule 'A ' to the plaint, 1/2 of the properties set out in Schedule A 1 to the plaint and whole of the properties set out in Schedule 'B ' to the plaint.
One of the items namely, item No. 1 of Schedule 639 'B ' to the plaint which consists of four shops is what remains undisposed out of the properties mentioned in Schedule 'D 1 ' to the deed of partition which were set apart for the purpose of discharging the aforesaid debts incurred by Subramanyam Chettiar before 1927.
The case as set out by Kota Venkatachala Pathy in his plaint was that the properties set out in Schedule 'B 1 ' to the deed of partition were given over to him absolutely for the discharge of the aforesaid debts set out in Schedule 'D ' to the deed of partition and it was provided in the said deed that either he would discharge the debts mentioned in the deed or undertake to pay the same himself within a month from the registration of the document and obtain and hand over to Subramanyam Chettiar receipts from the creditors specifically mentioned there that Subramanyam Chettiar was not liable for payment of the aforesaid debts and that if the aforesaid conditions were not satisfied by him i.e. by Kota Venkatachala Pathy and any loss was occasioned to the former, the latter would be liable for those losses.
The case of Kota Venkatachala Pathy further was that since he had discharged the debts detailed in Schedule 'D ' to the deed of partition, he was entitled to the exclusive possession of item No. 1 of Schedule 'B ' to the plaint as his self acquired property by virtue of the terms of deed of partition and also to the rest of the properties detailed in the said Schedule 'B ' as he had purchased the same with his own funds.
Kota Venkatachala Pathy based his claim of 3/4th share in properties detailed in Schedule 'A ' to the plaint on the ground that he was entitled to 1/4th by birth as a coparcener and the rest of the half share allotted to Subramanyam Chettiar as he had purchased the same from auction purchasers.
The relief for accounts was based by Kota Venkatachala Pathy on the ground that there was an oral division in status in 1938 and it was the appellant who was managing the properties either as a co owner or as an agent since then.
The appellant resisted the claim of extra share made by Kota Venkatachala Pathy and contended that the latter was entitled only to half share in all the suit properties.
According to the appellant, the family debts set out in Schedule 'D ' to the aforesaid deed of partition was discharged by Kota Venkatachala Pathy not only by the sale of the properties set out in Schedule 'D 1 ' to the deed of partition but also by substantially utilising other joint family properties available for division.
It was also contended by the appellant that since Kota Venkatachala Pathy acted as Karta of his branch, the aforesaid deed of partition should be construed as meaning that any item salvaged or saved after the discharge of the aforesaid family debts would be ancestral property and not exclusive property of the plaintiff.
As regards the properties other than item No. 1 of Exhibit 'B ' of the plaint, it was contended by the appellant that they were also to be shared half and half between him and Kota Venkatachala Pathy as they were purchased from the joint family funds.
With regard to the relief for rendition of accounts, the appellant contended that he became the Karta of the joint family in 1947 and Kota Venkatachala Pathy was not entitled to the relief of rendition of account till the date of the suit when alone there was a division of status and not in 1938 as claimed by Kota Venkatachala Pathy.
640 On a consideration of the evidence adduced in the case, the Trial Court by its judgment and decree dated September 12, 1960, held that there was no division in status till the date of the suit.
With regard to item No. 1 of Schedule 'B ' to the plaint, the Trial Court held that the total amount of debts paid was Rs. 15,669 6 2 and out of D 1 Schedule properties of the estimated value of Rs. 9,506/ only Rs. 2,575/ were realized from the sale of four items thereof and the balance of the debts were discharged from out of the joint family assets like jewels, outstandings realized and other immovable properties allotted to Rangaswamy Chettiar 's branch in 1929 partition and that the conversion of such joint family assets was made by Kota Venkatachala Pathy who was managing the family till 1957.
The Trial Court accordingly held that the properties namely item No. 1 of Schedule 'B ' to the plaint should be deemed to have been salvaged by detriment to the paternal estate.
The Trial Court also found that as the defendant appellant herein was a minor at the time of 1929 partition and Kota Venkatachala Pathy, the original plaintiff had acted as his guardian, the latter must be deemed to have acted for the former also when he undertook to discharge the debts and that as between the original plaintiff and defendant to whom the properties were jointly allotted under Exhibit A 1, there was a position of implied trust in respect of properties set out in Schedule 'A ' and 'B ' to the plaint.
The Trial Court also upheld the appellant 's plea of blending of all the properties by Kota Venkatachala Pathy.
The Trial Court also found that properties covered by sale deeds Exhibit B 1 and Exhibit B 4 which originally formed part of the half share allotted to Subramanyam Chettiar though purchased by the original plaintiff in his own name were joint family properties and as such were liable to partition in equal shares.
The Trial Court negatived the claim of Kota Venkatachala Pathy for a share in excess of one half in the aforesaid properties and held that he was entitled to only one half of all the suit properties.
The Trial Court also decreed that the appellant shall render true and proper accounts in respect of the income and expenses regarding half share of the respondents in the properties mentioned in Schedule A, A 1 and to the plaint from 1947 onwards but did not give directions as to the assets and funds of capital nature withdrawn by Kota Venkatachala Pathy from out of the joint family utilised for his own separate and independent business.
Aggrieved by this judgment, Kota Venkatachala Pathy, the original plaintiff, whose legal representatives are the respondents herein, preferred an appeal to the High Court of Judicature of Madras.
By its judgment dated December 8, 1966, the High Court allowed the appeal in part, set aside the judgment and decree of the Trial Court and decreed the suit brought by the original plaintiff with regard to item No. 1 of Schedule to the plaint holding that the properties mentioned in Schedule D 1 to the partition deed were conveyed absolutely to the original plaintiff in lieu of his undertaking to be liable to discharge the entire debts mentioned in Schedule 'D ' to the partition deed whether the properties were sufficient or insufficient to discharge the same and if there was any surplus out of the properties he was to have the same absolutely, but if the properties were not sufficient, he was to dis 641 charge the debts on his own responsibility without making Subramanyam Chettiar liable for the same; that though a portion of the debts were discharged out of the joint family funds that only cast on the legal representatives of the original plaintiff a liability to account to the appellant for such drawings as the original plaintiff might have made and whatever amount was found to be so drawn would have to be debited against his i.e. the original plaintiff, after giving him credit for whatever amount he might have put into the common fund.
The High Court further held that in determining the net drawals by the original plaintiff from the joint family funds, credit would be given to him for drawings made by the appellant by way of receipts of rents from item No. 1 of Schedule 'B ' to the plaint; that the original plaintiff was not liable to account for the joint family properties as there was no proof of mismanagement, mishandling or improper application of joint family properties or funds and that the defendant was also not liable to account to the original plaintiff for the management of the properties of which he was in charge.
The High Court affirmed the judgment of the Trial Court in regard to the properties covered by Exhibits B 1 and B 4 holding that these were acquired with the common funds of the original plaintiff and the appellant which he was managing.
Dissatisfied with this judgment and decree, the defendant has come up in appeal to this Court.
The learned counsel for the appellant has, while supporting the appeal, strenuously urged that the properties mentioned in Schedule D 1 to the deed of partition (Exh.
A 1) were not intended by the parties thereto to be given to Kota Venkatachala Pathy as his separate properties but were given to him only for a specific purpose viz. for discharging the family debts; that the ancestral properties could not be converted into separate properties by means of an arrangement arrived at between Subramanyam Chettiar and Kota Venkatachala Pathy; that the character of a property has to be decided after considering whether it is saved as a result of detriment to the paternal estate and as in the instant case, property mentioned at item No. 1 of Schedule D 1 to the deed of partition was saved by using the joint family assets, the said property could not but be regarded as the ancestral property of the parties which was subject to partition.
He has further urged that in any event D 1 Schedule properties lost the character of separate properties as they were blended by Kota Venkatachala Pathy with the joint family properties.
He has lastly urged that the directions given by the High Court with regard to accounting cannot be sustained as they are neither clear nor justified.
The principal question for determination in this case is whether the properties mentioned in D 1 Schedule to the deed of partition were separate properties of Kota Venkatachala Pathy or retained the character of ancestral properties.
The answer to this question depends largely on the construction of the deed of partition (Exh.
A 1), material portion whereof is reproduced below for facility of reference: "Venkatachala Pathy the individual No. 2 shall discharge the debts described in 'D ' Schedule, the debts payable to outsiders by Subramanyam Chetti amongst us for the 642 amount borrowed for conducting the family business prior to 20 11 27 and individual No. 2 for discharging the loans, shall enjoy absolutely the properties mentioned in Schedule D 1.
Venkatachalapathi Chetti, the individual No. 2 shall either discharge the debts within a month from the date of registration of this document and obtain receipt for the creditors stating that Subramanyam Chetti is not liable to the aforesaid loans and shall give those receipts to Subramanyam Chetti.
If it is not done so and thereby any loss is caused to Subramanyam Chetti by creditors, Venkatachalapathi Chetti shall be liable for those losses.
The aforesaid Venkatachalapathi Chetti himself shall get possession of D 1 Schedule properties given to him in lieu of discharging the aforesaid debts whether those properties are adjusted to the aforesaid debts, or whether there remain any balance or any deficit".
The salient features of the deed as extracted above are: (1) sole responsibility for discharge of the debts detailed in Schedule D 1 to the deed of partition which were payable to the outsiders was placed on Kota Venkatachala Pathy.
(2) The liability cast on Kota Venkatachala Pathy for the discharge of the debts was not to the extent of the properties detailed in Schedule D 1 to the deed of partition but was irrespective of the sufficiency or otherwise of the properties and any deficit or surplus was to be met or enjoyed by him exclusively.
(3) The debts were to be discharged by Kota Venkatachala Pathy within a month of the registration of the deed and he was required to have it in writing from the creditors that Subramanyam Chettiar was no longer liable for the debts.
(4) In case, there was a default on the part of Kota Venkatachala Pathy to discharge the debts as undertaken by him and any loss was caused to Subramanyam Chettiar, to the former was to indemnify the latter.
(5) Exclusive dominion, control and enjoyment of the properties mentioned in Schedule D 1 was vested in Kota Venkatachala Pathy in consideration of the obligation undertaken by him to discharge the debts.
The aforesaid salient features leave no manner for doubt that the properties mentioned in D 1 Schedule to the deed of partition were given to Kota Venkatachala Pathy in lieu of the personal undertaking given by him to discharge the aforesaid debts.
In other words, the conveyance of the properties to Kota Venkatachala Pathy was in the nature of remuneration for the services to be rendered by him.
It will be useful in this connection to refer to the decision of this Court in Raj Kumar Singh Kukam Chandji vs Commissioner of Income tax, Madhya Pradesh where on the question whether the managing director 's remuneration received by the assessee was assessable in his individual hands or in the hands of the assessee 's Hindu undivided family, this Court expressed the view that the remuneration was assessable as the assessee 's individual income and not as the income of his Hindu undivided family.
We are, therefore, of the 643 view that Schedule D 1 properties were given absolutely to Kota Venkatachala Pathy as his separate properties.
Let us now see as to whether the aforesaid arrangement entered between the members of the Hindu undivided family whereby properties mentioned in Schedule D 1 to the deed of partition were made over to Kota Venkatachala Pathy was valid according to Hindu Law.
A reference to page 426 of Mayne 's Treatise on Hindu Law and Usage (11th Edition) makes it clear that while dividing the family estate, it is necessary for the joint family to take account of both the assets and the debts for which the undivided estate is liable and to make provision for discharge of the debts.
It is also well settled by the decisions of this Court in Sahu Madho Das vs Pandit, Mukand Ram Maturi Pullaian vs Maturi Narasimham and section Shanmugam Pillai & Ors.
vs K. Shanmugam Pillai Ors.
that if family arrangements which are governed by a special equity peculiar to themselves or entered into bonafide to maintain peace or bring about harmony in the family and the terms thereof are fair taking into consideration the circumstances of the case, every effort must be made by the Court to recognise and sustain it.
Examining the matter in the light of these principles, we find that by the aforesaid arrangement both Subramanyam Chettiar and the defendant appellant were absolved of the responsibility to discharge the family debts and liability was cast on Kota Venkatachala Pathy alone to discharge the same irrespective of the fact whether the properties mentioned in Schedule D 1 to Exhibit A 1 ultimately turned out to be sufficient or insufficient to meet the burden.
Thus the arrangement being bonafide and its terms being fair, we cannot but hold that it was valid and the properties detailed in Schedule D 1 to the deed of partition became separate properties of Kota Venkatachala Pathy from the date of the execution of the deed of partition and are not liable to partition.
This takes us to the question as to whether there was, as contended by the appellant, any blending of the properties mentioned in Schedule D 1 to the deed of partition with the rest of the properties of the joint family consisting of Kota Venkatachala Pathy and the appellant.
It is true that property separate or self acquired of a member of a joint Hindu family may be impressed with the character of joint family property if it is voluntarily thrown by the owner into the common stock with intention of abandoning his separate claim therein but the question whether a coparcener has done so or not is entirely a question of fact to be decided in the light of all the circumstances of the case.
It must be established that there was a clear intention on the part of the coparcener to waive his separate rights such an intention cannot be inferred merely from the physical mixing of the property with his joint family or from the fact that other members of the family are allowed to use the property jointly with himself or that the income of the separate property is utilised out of generosity or kindness to support persons whom the holder is not bound to support or from the failure to maintain separate accounts for an 644 act of generosity or kindness cannot ordinarily be regarded as an admission of a legal obligation.
(See Lakkireddi Chinna Venkata Reddi & Ors.
vs Lakkireddi Lakshmama and G. Narayana Ram vs G. Chamaraju & Ors.
In the instant case we are unable to find that there was any intention on the part of Kota Venkatachala Pathy of abandoning his separate rights over the properties set out in Schedule D 1 to the deed of partition.
The mere fact that these properties were not separately entered by Kota Venkatachala Pathy in the account books or that no separate account of the earning from these properties was maintained by him cannot rob the properties of their character of self acquired properties.
We are accordingly of the view that there was no blending of the properties by Kota Venkatachala Pathy as contended by the appellant.
The mere fact that some amount out of the joint family funds was used for discharge of the debts mentioned in Schedule to the deed of partition is also of no consequence.
If any amount out of the joint family funds was used for the discharge of the outstandings payable to the outside debtors, the legal representatives of Kota Venkatachala Pathy would, as pointed out by the High Court be liable for them.
There is also no substance in the last contention advanced on behalf of the appellant.
The legal position is well settled that in the absence of proof of misappropriation or fraudulent or improper conversion by the manager of a joint family a coparcener seeking partition is not entitled to call upon the manager to account for his past dealing with the family property.
The coparcener is entitled only to an account of the joint family property as it exists on the date he demands partition.
In the instant case there being no evidence to establish any misappropriation or fraudulent conversion of the joint family property by Kota Venkatachala Pathy during the period he acted as karta of the family, we are unable to interfere with the direction issued by the High Court which is just and proper.
For the foregoing reasons, the appeal fails and is hereby dismissed but in the circumstances of the case without any order as to costs.
V.P.S. Appeal dismissed.
[/INST]The respondents acquired appellant 's land under the Land Acquisition Act.
The Land Acquisition officer awarded compensation at the rate of Rs. 3000/ per acre.
In a reference under section 18, the Additional District Judge enhanced the compensation to Rs. 800/ per katha (1/32 of an acre).
On appeal by the State, the High Court reduced the compensation to Rs. 475/ per katha.
In an appeal by certificate the appellant contended that the High Court was in error in reducing the rate of compensation.
Dismissing the appeal, ^ HELD: (1) The Additional District Judge wrongly excluded certain sale transactions on the ground that the plots in those transactions were at some distance from the acquired land.
The High Court rightly held that the said transactions could not be excluded altogether from consideration.
The High Court also took into account 3 other sale transactions which were relied upon by the appellant.
The High Court rightly excluded from consideration certain sale deeds executed by the appellant.
These transactions related to small plots of land situated on road site and were entered into after the land in dispute had been notified for acquisition.
[586E H, 587C D] (2) Market value under section 23 means the price that a willing purchaser would pay to a willing seller for property having due regard to its existing condition with all its existing advantages and its potential possibilities when laid out in the most advantageous manner excluding any advantages due to the carrying out of the scheme for which the property is compulsorily acquired.
In considering market value the disinclination of the vendor to part with his land and the urgent necessity of the purchaser to buy should be disregarded.
[587E F] (3) There is an element of guess work inherent in most cases involving determination of the market value of the acquired land.
But, this in the very nature of things cannot be helped.
The essential thing is to keep in view the relevant factors prescribed by the Act.
The finding of the High Court is based upon consideration of the evidence adduced in the case and there are no grounds to interfere with that finding.[587F G]
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<s>[INST] Summarize the judgementCivil Appeal No. 879 of 1975.
Appeal by special leave from the Judgment and order dated the 4th November, 1974 of the Punjab and Haryana High Court in Civil Writ No. 4346 of 1974.
Hardyal Hardy, section K. Mehta, K. B. Nagaraja, P. N. Puri, M. Qamaruddin and K. Khanna, for the appellant.
O. P. Sharma, for respondent No. 1.
Luxmi Grover and section section Jauhar, for respondent No. 3.
The Judgment of the Court was delivered by GOSWAMI, J.
This appeal by special leave is against the judgment of the Punjab and Haryana High Court summarily dismissing a writ application under article 226 of the Constitution against the order of the State Transport Appellate Tribunal, Punjab.
The appellant is a private limited company carrying on transport business over a long period.
The company was granted 33 stage 219 carriage permits for various routes.
It had a sanctioned fleet of 35 transport vehicles.
On receipt of several reports and complaints from various sources, the State Transport Commissioner issued the following show cause notice to the appellant on March 28, 1974: "Regd.
From: section Balinder Singh, IAS, State Transport Commissioner, Punjab.
To The Managing Director, New Samundri Transport Company (P) Ltd., Ferozepur.
No. 455/JFI(2) dated Chandigarh the 28th March, 1974.
Subject: Departmental Action.
Memorandum A list of prosecutions launched against your company by the Operational Staff is forwarded herewith.
The offences committed are of a very serious nature.
Your company is also short of fleet of fit vehicles.
A copy of the joint report of the Secretary, Regional Transport Authority, Jullundur and Motor Vehicles Inspector, Jullundur relating to the condition of buses of your company is also enclosed.
Due to the shortage of fit vehicles against the sanctioned fleet of 35 buses, number of services are being missed whereby the public is being put to a great inconvenience.
You are, therefore, required to show cause as to why departmental action by way of suspension/cancellation of stage carriage permits under section 60 of the , should not be taken against your Company.
Reply should be sent to this office within 10 days of the receipt of this notice failing which it will be presumed that you have nothing to say.
State Transport Commissioner Punjab".
The appellant says that an explanation was posted to the Commissioner within time under certificate of posting.
According to the Commissioner it was not received.
The District Judge, who is the State Transport Appellate Tribunal, observed in his order that "some mischief appears to have been committed in the office of the respondent with regard to the reply which was sent under postal certificate".
220 We will, however, proceed on the assumption that no explanation was sent by the appellant to the Commissioner.
Even so a manifestly wrong procedure in a departmental action of this nature is obvious on the face of the above notice resulting in violation of the principles of natural justice.
The notice was issued under section 60 of the (briefly the Act) which may be quoted: 60(1)"The transport authority which granted a permit may cancel the permit or may suspend it for such period as it thinks fit (a) on the breach of any condition specified in sub section (3) of section 59, or of any condition contained in the permit, or (b) if the holder of the permit uses or causes or allows a vehicle to be used in any manner not authorised by the permit, or (c) if the holder of the permit ceases to own the vehicle or vehicles covered by the permit, or (d) if the holder of the permit has obtained the permit by fraud or misrepresentation, or (e) if the holder of the permit, not being a private carrier 's permit, fails without reasonable cause to use the vehicle or vehicles for the purposes for which the permit was granted; or (f) if the holder of the permit acquires the citizenship of any foreign country: Provided that no permit shall be cancelled unless an opportunity has been given to the holder of the permit to furnish his explanation".
Sub section (3) of section 60 provides for composition of breach of certain conditions.
Section 59(3) contains the conditions laid down for every permit.
The target of section 60 is the permit that has been issued breach of conditions of which is the subject matter of action under it except in cases covered by section 60(1) (d) and (f).
It is true that for each permit the permit holder is responsible and he is the person who has to submit the explanation.
The proposed penal action has to be particularised with reference to each permit detailing the particular conditions for breach of which action is sought to be taken in connection with a particular permit.
This is the minimum requirement of section 60.
What we find in this case is a kind of bald notice making no reference to any particular permit for cancellation or suspension of which action has been taken.
It is as if all the 33 permits were going to be suspended or cancelled.
It is clear that after receipt of the various reports the Commissioner did not apply his mind to scrutinise the same 221 for the purpose of taking appropriate legal action against any specific permit under section 60 of the Act.
On the other hand taking the reports as they were, which may as well have been general allegations against the permit holder, immediately action was taken for suspension or cancellation of all the permits.
From the list of prosecutions we find only 15 vehicles are involved and most of the cases are of overloading.
Some of the cases relate to non accompaniment with the vehicles of registration certificates and other documents.
In some cases, against certain vehicles, the time schedule was not kept and certain trips were missed.
We are not at all on the merits of these prosecutions.
What is important in a departmental action of this type for violation of conditions of permit is that it must relate to the particular permits appertaining to concerned vehicles.
It is of utmost importance that charges are made with reference to each permit in clear terms in order to enable the permit holder to furnish his explanation.
Proviso to section 60(1) which requires mandatory compliance is nothing short of a reasonable opportunity to the permit holder to furnish his explanation.
Unless, therefore, the breaches of conditions or other allegations are particularised with reference to each permit in the show cause notice, such notice is clearly invalid and no action can be taken under such a notice.
This is exactly what has happened in this case resulting in violation of the principles of natural justice ingrained in the proviso to section 60(1) of the Act.
The High Court, therefore, was not right in not interfering with the order of the authorities cancelling the permits.
In the result the appeal is allowed.
The order of the High Court as well as the orders of the State Transport Appellate Tribunal and the Commissioner are set aside.
We will, however, make no order as to costs.
P.B.R. Appeal allowed.
[/INST]Section 3 of the Bihar Land Reforms Act, 1 950, transfers all interests in estates or tenures of a proprietor or tenure holder to the State as from a date notified under section 4.
Section 6 carves out of this land mass and leaves untouched, apart from raiyati holdings the bakasht lands in Khas possession of the 'intermediary ' i.e., the prior full owner.
Several items of property were gifted by one Ram Badan Singh to his two wives whose names were duly mutated in the revenue register.
By further gift deeds and transfers the lands covered by the original gift deeds can to vest in the plaintiff and defendants, second party.
They divided them as per a partition deed Exhibit 4/a dated October 30, 1952 whereby the suit lands fell to the exclusive share, of the plaintiff along with some other items while other properties were similarly allotted to defendants 2nd party.
Despite this fact defendants, second party, sold the suit lands to the defendants first party alleging an oral partition sometime before August 1952 and under cover of that ease, committed trespass.
Thereupon, a scramble for possession of these properties and a proceeding under section 145 Cr.
P.C. ensued in which the defendants, first party, got their possession upheld by Magistrate 's order dated S 4 1954.
The plaintiff brought the present suit in April 1955 for a declaration of ' his title, for possession and mesne profits on the score that his exclusive possession was by force taken away in July August 1954 by defendants first party the latter put forward the plea of prior oral partition and exclusive hostile possession, tracing their claim through defendants second party.
The courts of tact found against the defendants and decreed the suit, but in Letters Patent Appeal, the respondents i.e., the defendants 1st party succeeded on the ground that the plaintiff had lost his title on account of the operation of sections 3 and 4 of the Bihar Land Reforms Act, 1950.
In this appeal filed on the basis of the special leave granted by this court, it was contended for the appellant that (i) Section 6 of the Act applied to the facts of the case and so there was no vesting of title in the State of the suit lands; (ii) This case, resting on the Act, which had been on the statute book for several ' years, had not been set up at the earlier stages of the litigation at and should not have been permitted at the Letters Patent Appeal stage in the High Court for the first time; and (iii) The deed of partition was not legally divestative of rights in view of the provisions of the Estates Partition Act, 1897, which empowered the Collector along to partition the properties, which not having been done, the lands remained in co ownership therefore the possession of ' the defendants first party, was that of co sharers.
If that were so.
the possession of one co sharer was constructive possession of the other co sharer and the plaintiff was thus in khas possession under section 2k of the Act and, on that basis, section 6 of the Act saved the disputed properties from vesting in the State.
Rejecting the contentions except to a small extent of modifying the decree, ^ HELD: (i) It is well settled that a pure question of law going to the root or the case and based on undisputed or proven f acts could be raised even before the Court of last resort, provided the opposite side was not taken by surprise or otherwise unfairly prejudiced [745 E F] Connecticut Fire Insurance Company vs Kavanach.
, 480.
referred to.
740 In the present case the new plea springs from the common case of the, parties and nothing which may work injustice by allowance of this contention has been made out.
[746 A] (ii) The Magistrate did not direct possession of the B Schedule properties to be handed over to the defendants, first party, but declared their actual possession.
He has done no wrong nor conferred any unjust advantage.
There is no principle on which it could be held that these circumstances deprive .
party of the benefit of his possession and of the dispossession of the plaintiff flowing from s.6 of the Act.
[746D E] (iii) Neither the provisions of section 6(1) nor those of section 35 contain any prohibition against the civil court 's power to decide the issue of the and right to possession of the plaintiff and, as a necessary corollary, the claim of actual possession set up by the defendants, first party.
Nor can section 6(2) inferentially interdict the plenary power of the Civil court.
[746.A B] (iv) The partition is valid, it divests title it binds all.
but, so far as land revenue liability is concerned, it relieves parties from the burden falling on the other sharer 's land only if the exercise prescribed in the Estates Partition Act is gone through.
The statute is a protective fiscal armour, not a monorail for division among co owners to travel.
Section 7 makes it clear.
Not that Courts have lost power to decree partition nor that co owners have become powerless to separate their shares voluntarily but that land revenue shall not be prejudiced without the procedure under that Act being gone through.
More clinching is the fact that the plaintiff has here come to Court on the sole case of partition by metes and bounds and has founded his relief not as co sharer but as exclusive owner.
[747 G H, 748 Al Mahanth Ram Bhushan Das V. Ramrati Kuer, 1965 Bihar L.J. 119, referred (v) The purpose and purport of section 6(1) is to allow the large land holders to keep possession of small areas which may be designated as the private or privileged or mortgaged lands traditionally held directly and occasionally made over to others, often servants or others, in the shape of leases or mortgages.
It is obvious that section 6(1) uses the word 'including ' to permit enlargement of the meaning of khas possession for the limited purpose of that section, emphasising thereby that, but for such enlargement, the expression khas possession excludes lands outstanding even with temporary lessees.
It is perfectly plain, therefore, that khas possession has been used in the restricted sense of actual possession and to the small extent it had to be enlarged for giving relief to proprietors in respect of 'private ', 'privileged ' and mortgaged lands, inclusive expressions had to be employed.
Khas possession is actual possession.
Constructive possession or possession in law is what is covered by sub clauses of section 6(1).
It is not correct to say mat possession is so wide as to include a mere right to possess, when the actual dominion over the property is held by one in hostility to the former. [751 AB, G H, 752 C E.] (vi) In Anglo American jurisprudence also possession is actual possession and in a limited set of cases, may include constructive possession, but when there is a bare right to possess bereft of any dominion or factum of control, it will be a strange legal travesty to assert that an owner is in possession merely because he has a right to possess when a rival, in the teeth of owner 's opposition.
is actually holding dominion and control over the land adversely, openly and continuously.
This court has rejected the theory that the possession of a trespasser was that of the owner.
[752 H, 753A, 754 D.] Surajnath Ahir vs Prithinath Singh , Ram Bijai Singh & Ors vs Behari Singh @ Bagandha Singh relied on.
Brij Nandan Singh vs Jamuna Prasad A.I.R. 1958 Pat. 589, referred to.
(vii) It is undeniable that the plaintiff had title to the entire Schedule properties as against defendants, first party, and second party.
If defendants.
first party, were not in possession the plaintiff would still be entitled for a decree 741 for possession of the same.
If neither is in possession, the presumption that the owner is in possession holds good and he is entitled to that possession being restored to him.
Therefore, the plaintiff is entitled to a decree for possession regarding the items of properly covered by paragraph, 27 of the written statement filed on behalf of the contesting defendants, first party.
the rights of the State as against the plaintiff in regard these items of property, will not in any manner be effected.
[754H. 755 A B] observation: Prima facie section 4 (f) and (g) of the Act and rule 7 H of the Rules framed under the Act attract the jurisdiction of the State and its revenue authorities.
In the present case, the defendants, first party, are rank trespassers and have no equity in their favour.
Section 4(f) declares that the Collectors shall be deemed to have taken charge of the estates and interests vested in the State.
This means he has a public duty to take charge of lands vested in the State.
Surely, a responsible public office like the Collector, charged with duty of taking delivery of possession of lands which by virtue of the vesting the State is entitled to take direct possession, will proceed to disposses the trespasser.
In this case, defendants, first party the trespassers and the plaintiff being out of the pale of section 6, the State ii entitled to the direct possession of the suit lands.
[756B, 755 D E]
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<s>[INST] Summarize the judgementminal Appeals Nos.
153, 155 and 172 of 1967.
139 Appeals by special leave from the judgment and order dated April 3, 1967 of the Bombay High Court in.
Criminal Appeals Nos. 617, 621, 619 and 620 of 1965.
A. section R. Chari, N. H. Hingorani and K. Hingorani, for appellant No. 1 (in Cr. A. No. 153 of 1967).
N. H. Hingorani and K. Hingorani, for appellant No. 2 (in Cr. A. No. 153 of 1967).
A. section R. Chari, and N. N. Keswani, for appellant (in Cr. A. No. 155 of 1967).
W. section Barlingay and A. G. Ratnaparkhi, for the appellant (in Cr. A. No. 172 of 1967).
M. section K. Sastri and section P. Nayar, for the respondent (in all the appeals).
The Judgment of the Court was delivered by Dua, J.
The four appellants in these three appeals by special leave were tried in the court of the Special judge for Greater Bombay on a charge of conspiracy punishable under section 120 B, I.P.C. Accused No. 1 (Shiv Kumar Lokumal Bhatia) was a godown clerk; accused No. 2 (Hargun Sunderdas Godeja) was the Senior Godown Keeper and accused No. 3 (Hundraj Harchomal Mangtani) was the Godown Superintendent at the General Motors Godown at T Shed, Sewri, Bombay, belonging to the Food Department of the Government of India.
Accused No. 4 (Shankar Maruthi Phadtare) was a driver of Truck No. 2411.
The allegation against them was that all these accused during the month of July, 1963 were parties to criminal conspiracy to commit criminal breach of trust in respect of 1060 bags of red wheat which were released from the ship section section Hudson on July 7, 1963 at Bombay for storing them in the G M.2 Godown at Sewri.
In pursuance of this conspiracy, it was alleged, they had dishonestly and fraudulently misappropriated or converted to their own use 80 bags of red wheat out of 1060 bags released from the ship.
Accused Nos. 1, 2 and 3 were also charged under section 409 read with section 34, I.P.C., section 5(2) read with section 5(1)(d) of the Prevention of Corruption Act.
1947 read with section 34, I.P.C., section 5(2) read with section 5(1) (c) of the Prevention of Corruption Act read with section 34, I.P.C. and section 477 A read with section 34, I.P.C. The learned Special Judge on a consideration of the evidence on the record held that the prosecution has succeeded in proving conspiracy on the part of all the four accused to commit 140 criminal breach of trust in respect of the 80 bags offered wheat Accused Nos. 1, 2 and 3 were also held to have gained pecuniary advantage and further to have altered the records of the T Shed.
Holding the offences to be serious in view of the general shortage of foodgrains in the country the court felt that the case called for deterrent sentences.
Under section 120 B I.P.C. all the accused were sentenced,, to rigorous imprisonment for four years.
Accused Nos. 1, 2 and 3 were in addition held guilty under section 409, I.P.C. read with section 34, I.P.C. and under section 5 (2) read with section 5 (1) (c) of the Prevention of Corruption Act read with section 34, I.P.C., under section 5(2) read with section 5(1)(d) of Prevention of Corruption Act read with section 34, I.P.C. and also under section 477 A read with section 34, I.P.C. and sentenced to rigorous imprisonment for four years on each of these four counts,.
the sentences to be concurrent.
On appeal the High Court confirmed the order of the trial court as against accused No. 4 and dismissed his appeal.
The conviction of accused No. 1 under section 5(2) read with section 5(1) (c) of the Prevention of Corruption Act read with section 34, I.P.C. was set aside.
But his conviction and sentence under section 120 B, I.P.C. and under section 5(2) read with section 5(1)(d) of the Prevention of Corruption Act read with section 34, I.P.C. as also under section 477 A read with section 34, I.P.C. was confirmed.
His conviction under section 409 read with section 34, I.P.C. was altered to one under section 409, I.P.C. but without altering the sentence.
The convictions of accused Nos. 2 and 3 under section 409, I.P.C. read with section 34, I.P.C. as also under section 5 (2) read with section 5 (1 ) (c) of the Prevention of Corruption Act read with section 34, I.P.C. were set aside but their conviction and sentence under section 120 B, I.P.C. and under section 5(2) read with section 5(1)(d) of the Prevention of Corruption Act read with section 34, I.P.C. was confirmed.
In this Court Shri Chari questioned the appellants convic tion on the broad argument, which was indeed the main plank of his challenge against the impugned order, that there was great confusion in the matter of storage of stocks of the foodgrains in the T Shed and there was complete want of regularity and considerable inefficiency in the matter of keeping the records of the arrivals and storage of the stocks with the result that it would be highly unsafe to rely on the evidence relating to the records of the stocks in the T Shed, for holding the appellants guilty of the criminal offences charged.
The learned counsel appearing on behalf of the other appellants, while generally adopting Shri Chari 's arguments, supplemented them by reference to the distinguishing features of the case against their indi vidual clients.
141 The counsel in the course of their arguments emphasised that the prosecution, in order to prove the negative, has the difficult task of affirmatively establishing by unimpeachable evidence that 80 bags which were the subject matter of the charge were in fact not received in the T Shed.
The prosecution must, said the counsel, bring the charge home to every accused person beyond reasonable doubt.
The submission as developed by all the counsel representing the appellants did seem on first impression to be attractive but on a deeper probe we consider it to be unacceptable.
It is no doubt true that the onus on the prosecution is of a negative character and also that the failure on the part of the accused to give evidence on the question as to when, where and to whom.
the controversial 80 bags were delivered at the point of unloading a fact on which the driver of the truck and those whose duty it was to receive the goods at the T Shed could give the best and the most direct information cannot under our law give rise to any presumption against them.
The criminal courts holding trial under the Code of Criminal Procedure have accordingly to bear in mind the provisions of section 342 A of the Code and to take anxious care that in appreciating the evidence on the record and the circumstances of the case, their mind is not influenced by such failure on the part of the accused.
But that does not mean that such negative onus is not capable of being discharged by appropriate circumstantial evidence.
If the circumstantial evidence which is trustworthy and which with unerring certainty establishes facts and circumstances the combination of which, on reasonable hypothesis, does not admit of any safe inference other than that of the guilt of the accused then there can hardly be any escape for him and the Court can confidently record a verdict of guilty beyond reasonable doubt.
The court would, of course, be well advised in case of circumstantial evidence to be watchful and to ensure that conjectures or suspicions do not take the place of legal proof.
The chain of evidence to sustain a conviction must be complete and admit of no reason able conclusion consistent with the innocence of the accused.
In the present case it is fully proved and is indeed ,not disputed on behalf of the accused that truck No. 2411 with the 80 bags of red wheat did leave the dock and did pass the yellow gate which is the check point where a register is kept by the Regional Director of Food.
In this Register entries are made when a truck leaves the yellow gate.
The truck in question left the yellow gate at 1 1.20 a.m. on the second trip as deposed by Parmar, (P.W.8).
And this is not disputed.
According to the accused the 80 bags in question were actually delivered at the appropriate place at the T Shed and the truck chits duly given to the truck driver in token of their receipt and indeed D.W. 1 war, 142 produced by accused No. 4 to prove the actual delivery.
The prosecution case, on the other hand, is that those bags were not, delivered at the T Shed but were misappropriated.
There is no dispute about the procedure of delivery at the T Shed of the goods brought from the dock.
This procedure in regard to the wheat brought on February 7, 1963 may briefly be stated.
The foodgrains consisting of 1060 bags of red wheat had arrived by section section Hudson at the Alexandra docks.
The trucks were loaded with the wheat bags to be taken to the T Shed, Sewri.
Four truck chits were prepared at the docks for each truck out of which two were given to the truck driver concerned.
The driver had to give the truck chits at the godown at the time of the delivery of the bags.
One such chit would be returned to him after endorsing acknowledgment of the receipt of the bags, the other chit being retained at the godown.
The one given to the driver was meant to authorise the receipt of hire charges from the food department.
At the godown, according to the general pro cedure, the driver of the trucks had to give the truck chits to one of the godown clerks there.
A batch of gangmen under a particular Mukaddam had generally to unload the goods from the truck allotted to him and no Mukaddam with his gangmen could unload the goods from a truck which was not allotted to him for the purpose.
The gangmen had, therefore, to unload the goods as instructed by the clerk and the senior godown keeper.
After unloading the bags cooly voucher was to be prepared and the daily diary maintained at the godown written: the kutcha chit was prepared by the godown keeper after the unloading and weighment of the goods.
Only 10% of the bags were as a matter of practice to be actually weighed.
The truck movement chart exhibit 10 shows the order in which the various trucks left the dock for the T Shed on July 7, 1963 as also their contents and the truck chit numbers.
Truck No. 2411 with 80 bags of red wheat figures twice in this document but it is not disputed that trip which concerns us is entered at sl.
No. 9.
Truck chit number of this trip is 69 and the truck left the dock at 11.
15 hours.
The truck at serial No. 8 (immediately preceding the trip in question) in this document is No. 2248 with 80 bags and its chit No. is 68.
This truck left the dock at 11 a.m.
The truck at sl.
No. 10 (immediately next after the one in dispute) is 1477 with 65 bags of red wheat whose truck chit No. is 72.
This truck left the dock at 11.45 hrs.
There were in all 14 trips on July 7, and indeed, this is also established by oral evidence and is not denied on behalf of the accused.
We may now turn to the tally sheet for July 7, The first thing to be noticed in this document is that it only shows the arrival of 13 trucks.
In other words accord 143 ing to this document there were only 13 trips of the trucks though the Truck Movement Order exhibit 10 clearly shows that there were 14 trips and on behalf of the accused also it was asserted that there were 14 trips.
We find in Exhibit 41 that after sl. No. 8 which relates to truck No. 2488 with its chit No. 68 and which arrived at the T Shed at 11.58 a.m there is recorded at serial No. 9 the arrival of truck No. 7866 with chit No. 70 and at sl.
No. 10 the arrival of truck No. 1477 with chit No. 72 and at sl.
No. 11 the arrival of truck No. 8769 with chit No. 71.
These three trucks are shown to have arrived at the unloading point at 1.
15 p.m.
It was explained at the bar that from 12 noon to 1 p.m. no work was done, it being lunch interval.
It has been so stated by P. section Shinde, Assistant Director, Vigilance Branch, as, P.W. 18.
Items at sl.
12 and 13 relate to trucks Nos.
2752 .and 1289 with their respective chit nos.
73 and 74.
It is thus clear that chit No. 69 is missing in this sheet.
Bapu T. Pingle produced as D.W. 1 claims to have been in truck No. 2411 as a wamer with the driver, accused No. 4, on July 7, 1963.
According to him this truck made two trips on that day between the dock and the T Shed and on the second trip the other wamer by name Yashwant had taken the truck chit from the clerk concerned after the same was duly signed.
This witness has deposed about the procedure at the godown which is the same as was suggested on behalf of the prosecution.
The man at the godown used to direct the drivers to the place of unloading the goods and, to quote his own words, "unless an entry was made in this Book (Tally Book) we were not allowed to go ahead at all.
" So, according to his evidence, unless an entry is made in the Tally Book the truck could not proceed to the unloading point to deliver the goods brought from the dock.
Exhibits 10 and 41 in our view affirmatively prove that 80 bags of red wheat carried by truck No. 241 1 on July 7, 1963 on the second trip did not reach the T Shed at all.
This finds support, even from the testimony of D.W. 1.
In view of this documentary evidence with which no fault has been found the evidence regarding irregularities in the record of stock at the T Shed loses all importance.
It may be pointed out that July 7, 1963 was a Sunday and as deposed by Parmeshwar D. Menon (P.W. 1) on that day all gates were not opened.
But this . is not all.
Though in the tally chits time of the arrival of the truck at the unloading point is given in the truck chit in question that time is not shown.
According to the evidence of Roque (P.W. 6) on the reverse of all truck chits Exts.
15 to 26 and Exts.
li A and 11 B entries are made in the handwriting of accused No. 1.
In Exhibits 15 to 26 in addition to the arrival and denarture of the trucks, progressive totals at the back of each of them is also stated, but in exhibit ll B there is no progressive total and in exhibit 11 A there is no signature of accused No. 1 144 though the progressive total is mentioned as 240.
Exhibuit 11 B, it may be pointed out, appertains to the trip by truck No. 2411 on July 7, 1963.
Shri Shinde, (P.W. 18) who was Assistant Director, Vigilance Branch at the relevant time has deposed that according to the weighment register exhibit 69 only 98 bags of S.S. Hudson were weighed and this was 10% of 980 bags.
This document bears the signatures of accused No. 1.
Exhibit 41, carbon copy of the Arrival Tally sheet which was sent to the head office for showing if there was any detention of trucks in the godown ' does not, as already noticed contain any entry in respect of the truck in question.
The reverse of exhibit 41 is not printed in the printed paper book but we have checked up from the original record that witness Shinde is right.
Non inclusion of the entry of the truck in question in exhibit 41, is in our view, very material.
In exhibit 53 the daily Arrival Tally book for July 7, 1963 the entry at sl.
No. 68 shows departure of the truck in question at 12.15 afternoon whereas in exhibit 41 it is ,shown as at 1. 15 p.m. and in exhibit 11 B at 12.15 afternoon.
This, according to P.W. 18, was designed to show that the truck was ,unloaded during the recess period which, according to evidence ,on the record, was not done.
The explanation of accused No. 1 is that on July 7, 1963 he was not feeling well though he attended the office.
He had to get chits from the warners and count the number of bags in the truck and order the labourers to unload them from the trucks.
The suggestion appears to be that due to these multifarious duties and due to his being unwell he had perforce to enter the truck chits in the tally books only when he could get time and meanwhile he had no other alternative but to put the unentered truck chits in his pocket.
According to him, it was on July 10, 1963 when he was giving his clothes to the washerman that he discovered, the solitary chit in question left by mistake in his pocket.
The explanation is far from satisfactory and we are not impressed by it.
It may in this connection be pointed out that July 7, 1963 was a Sunday and the three accused persons were specially called for receiving the grain that had arrived by the two steamers.
The amount of work to be done on that day can thus scarcely be ,considered to be excessive.
And then the fact that only one solitary truck chit relating to the 80 bags in question should happen to have remained in the pocket of accused No. 1 to be discovered only on July 10, 1963 is also not without some significance.
We agree with the High Court in holdings, this explanation to be unconvincing and that the 80 bags in question were in fact not received at the T Shed on July 7, 1963.
In 145 our opinion, the material on the record to which our attention has been invited fully supports the conclusions of the High Court.
We may appropriately repeat what has often been pointed out by this Court that under article 136 of the Constitution this Court does not normally proceed to review the evidence in criminal cases unless the trial is vitiated by some illegality or material irregularity of procedure or the trial is held in violation of rules of natural justice resulting in unfairness to the accused or the judgment or order under appeal has resulted in grave miscarriage of justice.
This Article reserves to this Court a special discretionary power to interfere in suitable cases when for special reasons it considers that interference is called for in the larger interests of justice.
As observed by this Court in Chidda Singh vs The State of Madhya Pradesh(1) this Article cannot be so construed as to confer on a party a right of appeal where none exists under the law.
We, however, undertook in this case to go through the evidence, to which our attention was invited to see whether or not the conclusions of the High Court are insupportable.
We are not persuaded to hold that in this case there is any cogent ground for interference with those conclusions.
These appeals according fail and are dismissed.
V.P.S. Appeals dismissed.
(1) Crl.
125 of 1967 decided on 12th January, 1968.
[/INST]As condition precedent to the applicability of section 10 A of the Excess Profits Tax Act, 1940, it must be proved that during the chargeable accounting period the assessee was carrying on the kind of business to which the Act applies by virtue of section 5 of the Act.
Section 2(5) of the Act states what is included in the word "business".
It is not possible to lay down a general definition which would cover all cases of business.
Business involves the fundamental idea of a continuous activity.
It connotes some real, substantial and systematic or organised course of activity with a set purpose.
Single isolated transaction may also bear the clear indicia of trade or an adventure in the nature of trade which is included in the word "buisiness" mentioned in section 2(5) of the Act.
Hence whether a particular source of income is business or not must be decided on the facts and circumstances of each case according to our ordinary conception of business.
Since 1935 the assessee firm carried on the business of manufacturing ribbons and laces and for this purpose owned buildings, leasehold rights, plant, machinery etc.
On April 7, 1940, a public limited liability company was incorporated with the object of acquiring and taking over the buildings, leasehold rights, plant, machinery etc.
, from the assessee firm.
The company purchased leasehold rights in the lands and buildings where plant, machinery etc. were installed.
The assesses firm as such ceased to manufacture ribbons and laces and was left with plant and machinery etc.
which it did not require and which ceased to be commercial asset in the hands of the firm.
The land and the buildings having been sold the assessee firm put it out of its power to use the plant, machinery etc.
In these circumstances the company took and the assessee firm granted a lease of the plant, machinery etc., at an annual rent of Rs. 40,000.
Held, that this lease of the plant, machinery etc., given by the assesses firm could not be "business" within the meaning of section 2(5) of the Excess Profits Tax Act, 1940.
953 Commissioner of Excess Profits Tax, Bombay City vs Shri Lakshmi Silk Mills Ltd. ([1952] S.C.R. 1), distinguished.
Inland Revenue Commissioner vs Broadway Car Co., Ltd. ([1946] 2 A.E.R. 609), relied upon.
Commissioner of Income tax vs Shaw Wallace & Co., ([1932] I.L.R. , referred to.
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<s>[INST] Summarize the judgementCivil Appeal No. 1833 of 1970.
Appeal by Special leave from the Judgment and Order dated the 17.4.1970 of the Mysore High Court in Civil Revision Petition No. 1255 of 1969.
A.S. Nambiar, Ashok Kumar Sharma and M. Veerappa for the Appellant.
R.B. Datar, Divender Singh, Ms. Madhu Moolchandani and Ms. Meenu Verma for the Respondent.
The Judgment of the Court was delivered by VARADARAJAN, J.
This appeal by special leave is directed against the Order dated 17.4.1970 of a learned single Judge of the erstwhile Mysore High Court (now Karnataka High Court) in CRP 1255 of 1969 which was filed against an Order dated 3.3.1969 of the Principal Civil Judge, Bangalore in Misc.
Case 6 of 1969, filed by Kabidi Venku Sah who was the first respondent in the Civil Revision Petition and is the appellant in this Civil Appeal.
The Principal Civil Judge allowed the Misc.
Case which was filed under Order 21 Rule 58 of the Code of Civil Procedure for raising an attachment over the house property effected at the instance of Syed Abdul Hai who was the petitioner before the High Court in the Civil Revision Petition and is the first respondent in this Civil Appeal.
The house property belonged originally to one Vittal Sah who was the husband of the second respondent Sharada Bai.
Vittal Sah had executed a 114 simple mortgage over the property in favour of the appellant on 31.7.1948.
The appellant obtained a decree on the mortgage on 4.9.1967 in O.S. 217 of 1966 on the file of the Principal Civil Judge and brought the property to sale in execution of that decree and purchased it himself on 24.7.1968 after obtaining the necessary leave of the Court to bid and set off.
The sale was confirmed on 28.8.1968 and the appellant took delivery of the property on 28.11.1969 in Misc.
Case 95 of 1968 as the court auction purchaser.
The first respondent Syed Abdul Hai obtained a money decree against Vittal Sah on 30.3.1967 in O.S. 386 of 1964 on the foot of a promissory note executed in 1961 for a sum of Rs. 20,000.
He obtained attachment before judgment over the same house property on 24.9.1964 on the same day on which filed that suit in the Court of the Principal Civil Judge, Bangalore.
He filed E.P. 31 of 1968 for realising the money due under the decree by bringing the house property to sale pursuant to the attachment before judgment effected on 24.9.1964.
Thereupon the appellant Venku Sah filed Misc.
Case 6 of 1969 under Order 21 Rule 58 of the Code of Civil Procedure for getting the attachment raised, alleging that the second respondent Sharada Bai had no saleable interest in the property on the date of the attachment and that the first respondent 's simple money decree cannot prevail over his mortgage decree and the sale of the property obtained in his favour in execution of that decree.
The first respondent Syed Abdul Hai opposed the claim petition, contending that the court proceedings referred to in the claim petition are collusive and fraudulent and that the delivery alleged by the appellant is only a paper delivery possession continued to be with the second respondent.
The Principal Civil Judge found that the mortgage decree, execution sale and delivery of the property to the appellant cannot be questioned in the first respondent 's claim petition as being collusive and could be questioned only in a separate suit.
He also found that there was no material on record to show that the second respondent continued to be in possession of the property after its delivery to the appellant pursuant to the court auction sale in his favour.
He rejected the contention that the appellant was not entitled to file any claim petition under Order 21 Rule 58 of the Code of Civil Procedure for raising the attachment before judgment effected under Order 38 Rule 5 and held that there is nothing on 115 record to show that the appellant was aware of the attachment and therefore there was no delay in filing the claim petition and that the claim petition could be filed under Order 21 Rule 58 even in the case of attachment before judgment in view of the provisions of Order 38 of Rule 8 which says that when any claim is preferred to property which has been attached before judgment, such claim shall be adjudicated upon in the manner provided for the adjudication of claims to property attached in execution of a decree for payment of money.
The Principal Civil Judge rejected the first respondent 's contention that the appellant had no interest in the equity of redemption even if the mortgage in his favour is true and that only the equity of redemption was attached on 24.9.1964 and held that what was attached the entire property and not the equity of redemption alone.
In this view, he allowed the claim petition.
Before the High Court it was contended for the first respondent that the appellant should show not only that he had an interest in the property attached on the date of the attachment but also possession thereof on that date before he could get the attachment before he could get the attachment before Judgment raised and that the property belonged to the second respondent 's husband and was in his possession on the date of the attachment and therefore the Principal Civil Judge could not have allowed the claim petition.
The appellant refuted that contention by peculiarly contending that he, a simple mortgagee, was in constructive possession of the property through the mortgagor.
The learned Judge of the High Court rightly rejected the contention that a simple mortgagee could be in possession of the mortgaged property constructively through the mortgagor and held that the appellant (claimant) should show that he had some interest in the property attached on 24.9.1964 and was in actual or constructive possession thereof.
He observed that the Principal Civil Judge has not recorded any finding on the question of the appellant 's possession of the property on the date of the attachment and that he has thereby wrongly exercised jurisdiction and acted with material irregularity in allowing the claim petition.
He found that the appellant had failed to prove that he had an interest in the property on the date of the attachment and was in possession of the property, either actual or constructive, on that date and held that he was therefore not entitled to have the attachment raised.
The matter is quite simple but has unfortunately dragged on for nearly 15 years on account of a wrong and ill advised step taken 116 by the appellant.
The learned Principal Civil Judge erred in observing that what was attached before judgment on 24.9.1964 is not the equity of redemption alone but the entire property.
He has rightly held that in the claim petition the question of the mortgage of 1948, the mortgage decree, the court auction sale and delivery of possession of the property to the appellant pursuant to that sale cannot be contended to be collusive and observed that the first respondent could, if at all, challenge them only in a separate suit.
That being so, undoubtedly the mortgage of 1948 in favour of the appellant was there and what remained with the mortgagor was only the equity of redemption until it was brought to an end by the sale in execution of the mortgage decree confirmed by the court on 28.8.1968.
Therefore, there could be no doubt whatsoever that on 24.9.1964 when the property was attached before judgment long after the mortgage dated 31.7.1948 and two years before the suit on the mortgage was filed in 1966, the mortgagor had the equity of redemption and that what could have been attached in law on 24.9.1964 was the equity of redemption alone and not the entire interest in the property.
There should have been no difficulty for the learned Judge of the High Court holding that the appellant could not have been in possession of the property, actual or constructive, for he was only a simple mortgagee who had nothing to do with possession until he got delivery of the property through the court as a decree holder court auction purchaser on 28.4.1968 as noticed by the learned Judge in his judgment.
The appellant had no doubt an interest in the property as mortgagee, but he could not have been in possession of the property as he was only a simple mortgagee.
The appellant was a secured creditor as he had a mortgage in his favour, and any attachment effected after the date of the mortgage and during its subsistence can be only subject to that mortgage.
He had no interest in the equity of redemption on the date of the attachment and could not therefore have had any objection to that right of the mortgagor being attached by the first respondent.
Therefore he was not a person who could in law file any claim petition under Order 21 Rule 58 objecting to the attachment of the equity of redemption.
We may notice here what Order 21 Rule 58(1) says and it is this: "Where any claim is preferred to, or any objection is made to the attachment of, any property attached in execution of a decree on the ground that such property is 117 not liable to such attachment, the Court shall proceed to adjudicate upon the claim or objection in accordance with the provisions herein contained.
" The attaching creditor can bring the property to sale only subject to the mortgage as long as it is subsisting.
That is to say he could bring only the mortgagor 's equity of redemption to sale if it had not already been extinguished by its sale in execution of any decree obtained on that mortgage.
But if the equity of redemption has already been sold after the date of the attachment the attaching decree holder could proceed only against the balance, if any, of the sale price left after satisfying the mortgagee decree holder 's claim under the decree.
The mortgagee 's right is thus not affected at all.
Therefore it is we had observed carrier that the appellant had taken a wrong and all advised step in coming forward with the claim petition which has resulted in the matter dragging on for over 14 years from 15.1.1969.
The appellant could not object to the attachment of the equity of redemption.
The appeal fails and is dismissed, but under the circumstances of the case without costs.
H.L.C. Appeal dismissed.
[/INST]The Deputy Excise & Taxation Commissioner held an auction for granting the right to sell country Liquor for liquor vend.
The respondents offered the highest bid which was provisionally accepted and they were declared the highest bidder under Rule 36(2) of the Punjab Liquor Licence Rules 1956.
Subsequently, the Excise and Taxation Commissioner accepted the bid as required Rule 36(22) The respondents however failed to deposit the security amount as required under Rule 36(22A) and thereby contravened conditions No 15(1) of the conditions of auction and Rule 36(23).
The Deputy Excise & Taxation Commissioner therefore served the respondents with a notice to show cause why the licence for country liquor vend, should not be re auction under Rule 36(23A) and the deficiency in price and all expenses of such re auction recovered from them under Section 60 of the Punjab Excise Act, 1914.
The respondents represented that before the auction it was announced that no wine shop would be opened within a radius of three miles of the liquor vend but across the border the State Government of Punjab had sanctioned the establishment of 716 a liquor shop which was hardly 2 1/2 miles from the border and this would mean that there would be two country liquor shops one in the State of Haryana and the other in the State of Punjab and this was in breach of condition No. 13(iii) read with Rule 37(88) of the Rules.
The Deputy Excise and Taxation Commissioner rejected the representation and directed the re sale of the licence for retail vend of the country liquor shop under Rule 36(23).
The shop was re auctioned.
At the time of re auction there were 52 bidders and the shop was re sold at the highest bid of Rs. 6.65 lakhs.
The respondents were served with a notice of demand of Rs. 3.46 lakhs representing the loss on re sale.
In their writ petitions to the High Court the respondents assailed the notice of demand.
Following the decision in Kanhiya Lal Bhatia & Co. vs State of Haryana & Ors.
the High Court held that the State had no authority to demand the amounts for failure of which the vends were put to re auction on the ground that the licence fee levied was in the nature of excise duty.
In the Appeals to this Court, on the question whether the State Government was entitled to realise the difference which the respondents had agreed to pay under the terms of auction of a liquor vend and the amount realized on reauction of the vend, as also the defaulted instalments of the licence fee payable in respect of a liquor vend: Allowing the appeals, ^ HELD: 1.
(i) There is a distinction between contracts which are executed in exercise of the executive powers and contracts which are statutory in nature.
Under Art.299 (1), three conditions have to be satisfied before a binding contract by the Union or the State in exercise of the executive power comes into existence: (1) The contract must be expressed to be made by the President or the Governor, as the case may be.
(2) It must be executed in writing.
And (3) the execution thereof should be by such person and in such manner as the President or the Governor may direct or authorize.
There can be doubt that a contract which has to be executed in accordance with article 299(1) is nullified and becomes void if the contract is not executed in conformity with the provisions of article 299(1) and there is no question of estoppel or ratification in such case.
Nor can there by any implied contract between the Government and another person.
[726C E] Smt.
Nanhibai vs The Excise Commissioner, M.P. & Ors., AIR (1963) MP 352, referred to.
Ram Ratan Gupta vs State of M.P., AIR (1974) MP 101.
Ajodhya Prasad Shaw & Anr.
vs State of Orissa & Ors., , M/S Shree Krishna Gyanoday Sugar Ltd. & Anr.
vs State of Bihar & Anr., , approved.
(ii) article 299(1) applies to a contract made in exercise of the executive power of the Union or the State.
but not to a contract made in exercise of statutory power.
article 299(1) has no application to a case where a particular statutory authority as distinguished from the Union or the States enters into a contract which is statutory in nature.
Such a contract.
even though it is for 717 securing the interests of the Union or the States.
is not contract which has been entered into by or on behalf of the Union or the State in exercise of its executive powers.
[726F G] K.P. Chowdhary vs State of M.P. ; , Mulamchand vs state of M.P. ; , State of M.P. vs Rattan Lal, , State of M.P., vs Firm Gobardhan Dass Kailash Nath, AIR , referred to.
(iii) In an excise contract, the Collector acting as Deputy Excise & Taxation Commissioner conducting the auction under Rule 36(22) and the Excise Commissioner exercising the functions of the Financial Commissioner accepting the bid under Rule 36(22A) although they act for and on behalf of the State Government for raising public revenue, have the requisite authority to do so under the Act and the rules framed thereunder and therefore such a contract which comes into being acceptance of the bid, is a statutory contract falling outside the purview of Article 299(1) of the Constitution.
In such a contract the requirements of Article 299(1) cannot be invoked.
[727B E] A. Damodaran & Anr.
vs State of Kerala & Ors.
; , referred to, In the instant case, there was unconditional acceptance of the highest bid of the respondents by the Deputy Excise & Taxation Commissioner at the time of the auction on March 11, 1969, and also by the Excise & Taxation Commissioner on March 21, 1969 as required under Rule 36(22A).
The respondents could not unilaterally by their letter dated April 12, 1969 rescind the contract on the pretext that the State Government of Punjab had opened a new liquor shop across the State border.
Even though this may have been in breach of the inter state agreement between the State Governments of Punjab and Haryana, the opening of such a liquor vend by the State Government of Punjab could not justify the respondents in not making the security deposit.
This would not amount to a breach of the conditions on the part of the State Government of Haryana or furnish a ground absolving the respondents of their liability to pay the shortfall.
[730E G ; 731A B] 2.
Persons who offer their bids at an auction to vend country liquor with full knowledge of the terms and conditions attaching thereto, cannot be permitted to wriggle out of the contractual obligations arising out of the acceptance of their bids by a petition under Article 226 of Constitution.
[731G] Har Shanker & Ors.
vs The Deputy Excise & Taxation Commissioner & Ors. , State of Haryana & Ors vs Jage Ram & Ors. ; ,.
State of Punjab vs M/s Dial Chand Gian Chand & Co. referred to 3.
(i) In a commercial contract for the performance of which a definite time has been fixed and the contract specifies the mode of payment.
i.e. specifies the dates on which the instalments of the licence fee are to be paid.
time is of the essence of the contract.
[732H] 718 (ii) Rule 36(23)(1) of the Rules specifically makes time of the essence.
It therefore follows that payment of the instalments on the due dates was a condition pre requisite to the performance of the contract.
[733A] In the instant case, the failure of the respondents to make payments relieved the State Government of their obligations.
The Excise & Taxation Commissioner would have been justified if he had cancelled the licence under Rule 36(23) and put the liquor vend to reauction for the remaining period of the financial year.
Instead of taking this drastic step of cancellation of the contract, the Deputy Excise & Taxation Commissioner served the respondents with the impugned notice of demand for payment of the first fortnightly instalment.
The respondents were bound to pay the defaulted instalment on the due date.
[733B C] 4.
The decision of the High Court in Kanhiyalal Bhatia Court in State of Haryana vs Jage Ram & Ors,
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<s>[INST] Summarize the judgementSpecial Leave Petition (Civil) No. 10326 of 1989.
From the Judgment and Order dated 1.8.1989 of the Patna High Court in C.W.J.C. No. 5768 of 1989.
R.K. Jain, R. Sharma, R.P. Sharma and Ms. Sangeeta Tripathi for the Petitioners.
The Judgment of the Court was delivered by KANIA, J.
This is one more case of an educational insti tution started in the State of Bihar without recognition applying for permission to allow the students, whom it has admitted and, from whom it has presumably recovered substan tial fees, to be allowed to appear at the ensuing examina tion on the ground that the question of its recognition has not been decided by the Government.
It appears from the judgment of the High Court that a number of similar mushroom institutions have sprung up in the State of Bihar without prior recognition, have admitted students, received fees from them and allowed them to undergo training for a sub stantial period of time without getting any recognition and thereafter tried to get permission from the Court for their students to be allowed to appear at the examination on grounds of sympathy.
This impression has been gathered from a 25 number of similar applications made to this Court in the last few months.
It is not possible to grant any such permission as prayed for because the granting of such permission would be clearly violating the provisions of the Education Act (See the judgments in S.L.P. No. 120 14 of 1987 decided on Novem ber 25, 1987 and the A.P. Christians Medical Educational Society vs Government of A.P. & Anr., ; ; What is however, unfortunate is that applications made by various educational institutions to the Government for recognition are not promptly disposed of.
In fact, we are of the view that the concerned department of the Government of Bihar should see to it that applications for recognition of educational institutions are decided promptly and where such an application is without merit, the Government should promptly reject the same and take steps to see to it that the rejection is brought to the attention of the students of the institution concerned so that they may not waste further time and money by undergoing training in that institution.
The failure of the Government to take such action would only reflect callous indifference to the inter ests of the young students to whom the Government certainly owes certain responsibilities.
We also feel that the State Government should issue advertisement through newspapers and other possible channels, if any, to ensure that students do not get misled by such unrecognised institutions into wast ing their precious time and money in undergoing training which will be of no avail to them.
We find that there ap pears to be a large number of students in the State who are misled by such institutions.
In fact, the State should consider taking such steps, criminal or civil, as open to it in law to stop such institutions and those who run them from misleading students and deceiving them.
We are informed that in the present case, the applica tion for recognition was made by the petitioners and as early as 1986 that application has not still been disposed of.
We direct that, if this so, the application should be disposed of within 4 weeks from today.
In these circumstances, we direct the State Government of Bihar to get published advertisements in at least three newspapers in that State with wide circulation warning students not to take admission in any educational institu tion which has not got recognition and making it clear that if they do so, they would be doing so at their own risk.
The advertisements to be issued within three weeks from the date of receipt of this order by the department concerned.
We direct that the 26 copies of this order be sent forthwith to the Chief Minister of Bihar, the Minister in charge of the Education Department and the Secretary of that department.
Special leave petition is dismissed with these observa tions.
In case the application of the petitioners for recog nition is granted, the Government will consider the granting of appropriate relief to the students in respect of the years for which the recognition is concerned.
R.S.S. Petition dismissed.
[/INST]Under Rule 8(1)(a) of the Defence Research & Development Service Rules, 1970, Junior Scientific Officers in the Defence Research & Development Organisation were eligible for promotion to the posts of Scientists 'B ' upto 50 per cent of the vacancies in the grade.
The respondents who were holding the posts of Junior Scientific Officers, and were promoted to the posts of Scientists 'B ' with effect from October 16, 1985 or from the date they actually assumed charge of the posts filed an application before the Central Administrative Tribunal, contending that since the posts to which they had been promoted were created between 1984 and 1985, they should have been promoted with effect from July 1984, as was done on previous occasions upto 1983, when promotions were ef fected from 1st July of the year in which promotions took place.
The Tribunal rejected the prayer of the respondents and directed that the promotions should be effective from the date on which the promotional posts were created.
The Union of India being aggrieved appealed to the Court.
On the question whether the Tribunal was justified in directing the promotions to be effective from the date the promotional posts were created.
Allowing the appeal, this Court, HELD: After a post fails vacant for any reason whatsoev er, a promotion to that post should be from the date the promotion is granted and not from the date on which such post falls vacant.
Similarly, when additional posts are created, promotions to those posts can be granted 752 only after the Assessment Board has met and made its recom mendations for promotions being granted.
If, however, promo tions are directed to become effective from the date of creation of additional posts, then it would have the effect of giving promotions even before the Assessment Board has met and assessed the suitability of the candidates for promotion.
[754C E] In the instant case, there is no statutory provision that the promotion to the post of Scientist 'B ' should take effect from 1st July of the year in which the promotion is granted.
There is also no law or rule under which a promo tion is effective from the date of creation of the promo tional posts.
The Tribunal was, therefore, in error in holding that the promotions should be effective from the date the promotional posts were created.
The orders of the appellants promoting respondents from October 16, 1985 will stand.
[754B C & F]
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<s>[INST] Summarize the judgementAppeal No. 537 of 1960.
Appeal from the judgment and order dated December 23, 1959, of the Mysore High Court in Writ Petition No. 229 of 1955.
section section Shukla and E. Udayarathnam, for the appellant.
H. N. Sanyal, Additional Solicitor General of India, R. Gopalakrishnan and P. D. Menon, for the respondents Nos. 1 and 2.
R. Gopalakrishnan, for respondent No. 3 1962.
April 18.
The Judgment of the Court was delivered by GAJENDRAGADKAR, J.
This appeal arises from a writ petition filed by the appellant, Raghutilaka Tirtha Sripadangalavaru Swamiji, in the Mysore High Court challenging the validity of section 6 (2) of the Mysore Tenancy Act, 1952 (XIII of 1952) hereafter called the Act, and the notification issued under the said section on March 31, 1952.
The appellant 's case as set out in his writ petition before the High Court was that the impugned section as well as the notification issued under it infringed his fundamental rights guaranteed under articles 14, 19 (1) (f), 26, 31 and 31A of the Constitution.
This contention has been rejected by the High Court and it has been hold that the section and the notification under challenge are valid and constitutional.
The appellant then applied for a certificate from the High Court, both under article 132 and article 133 of the Constitution.
The High Court granted him a certificate under article 133, but refused to certify the, case under article 132.
There 229 after the appellant applied to this Court for liberty to raise a question about the interpretation of the Constitution and permission has been accorded to the appellant accordingly.
That is how the present appeal has come to this Court.
The appellant owns 6 acres and 30 ghuntas of garden land in village Mulbagilu in Taluka Thirthahalli in the district of Shimoga.
Respondent No. 3, Ramappa, Gowda, is his tenant in respect of this land.
A registered lease deed was executed in favour of respondent No. 3 by the appellant on March 11, 1943; under this document respondent No. 3 undertook to pay 82 1/2 maunds of areca in addition to Rs. 17/12 in cash as rent per year.
In 1955 respondent No. 3 filed an application before respondent No. 2, the Tehsildar of Thirthahalli, under section 12 of the Act and claimed that the standard rent payable by him to the appellant should be fixed (Tenancy case 85 of 1955 56).
Meanwhile respondent No. 1, the Government of Mysore, had, in exercise of the powers conferred on it by section 6 of the Act, issued a notification No. R9.
10720/ L. section 73 54.2 on March 28/29, 1955.
This notification purported to fix the standard rent for lands of the category to which the appellants land belongs at one third of the produce.
Feeling aggrieved by this notification the appellant filed the present writ petition in the High Court on December 16, 1955, His case was that section 6 (2) as well 'as the notification issued under it were ultra vires, invalid and inoperative.
Before dealing with the contentions raised before us by Mr. Shukla on behalf of the appellant it would be necessary to consider very briefly the scheme of the Act.
The Act has been passed by the Mysore Legislature because it was thought necessary to regulate the law which governs the relations of landlords and tenants of agricultural lands and to regulate and impose restrictions on the 230 transfer of agricultural lands, dwelling houses, sites and lands appurtenant thereto belonging to or occupied by agriculturists in the State of Mysore except Bellary District and to make provisions for certain other purposes appearing in the Act.
That is the recital contained in the preamble to the Act.
It would thus be seen that the primary object of the Act is to afford much needed relief to the agricultural tenants by regulating their relations with their landlords and in that respect the Act bears a very close resemblance to the provisions of the Bombay Tenancy and Agricultural Lands Act, LXVII of 1948.
Indeed, the material provisions of the Act with which we are concerned are substantially similar.
Chapter I of the Act deals with the preliminary topic of defining the relevant terms used in the Act.
Chapter II contains general provisions regarding tenancies.
Section 4 defines persons who are deemed to be tenants.
Section 5 provides that no tenancy would be for less than five years.
Section 6 deals with the maximum rent payable by the tenants.
Section 8 provides for the calculation of rent payable in kind in the manner indicated by cls.
(i) and (ii) and prohibits the landlord from recovering or receiving rent calculated in any other manner.
Under a,. 9 receipt of rent in terms of service or labour is prohibited.
Section 11 abolishes all 'cases and section 10 enables the tenants to claim a refund of rent which has been recovered in contravention of the provisions of the Act.
Section 12 then deals with enquiries with regard to reasonable rent.
Sub section (3) of section 12 lays down five factors which have to be borne in mind by the authority dealing with an application for the fixation of reasonable rent.
Section 13 is a corollary of section 12 and authorises the reduction of rent after reasonable rent has been determined under section 12.
Section 14 deals with suspensions or remission of rent.
Section 15 231 provides for termination of tenancy.
Under section 18 a statutory bar is created against the eviction of a tenant from a dwelling house and under section 19 the tenant has the first option of purchasing the site on which he has built a dwelling house.
Similarly, under section 22 the tenant is given an option of purchasing the land leased out to him.
section 24 deals with some cases where relief can be granted against termination of tenancy and section 25 with relief against termination of tenancy for non payment of rent.
Section 30 provides for the procedure to recover rent and section 31 protects the tenants ' rights under any other law.
Chapter III deals with the procedure and jurisdiction of Amildar and provides for appeals against the decisions of the Amildar.
Chapter IV deals with offences and prescribes penalties for them and Chapter V contains miscelaneous provisions.
That, in its broad outlines, is the nature of the provisions made by the Act in order to give relief to the agricultural tenants.
Section 6 with which we are directly concerned in the present appeal reads thus: "6.
(1) Notwithstanding any agreement, usage, decree or order of a court or any law, the maximum rent payable in respect of any period after the date of coming into force of this Act by, a tenant for the lease of any land shall not exceed one half of the crop or crops raised on such land or its value as determined in the prescribed manner : Provided that where the tenant does not cultivate the land the rent payable shall be the reasonable rent to be fixed by the Amildar.
(2) The Government may, by notification in the Mysore Gazette, fix a lower rate of the maximum rent payable by the tenants of lands 232 situate in any particular area or may fix such rate on any other suitable basis as they think fit.
" As we have already indicated, the provisions of the two sub clauses of a. 6 are substantially similar to the provisions of section 6 ( 1) and (2) of the corresponding Bombay Act.
Indeed, it would be correct to say that Act with which we are concerned has been modelled on the pattern of the Bombay Act and has adopted most of its important provisions.
The validity of section 6 of the Bombay Act was challenged before this Court in "VasantalMaganbhai Sanjanwala vs The State of Bombay (1)" and it has been held that the said section is valid.
The reasons given by this Court in upholding the validity of is.
6 of the Bombay Act apply with equal force in support of the validity of section 6 of the Mysore Act and so the point raised by the appellant in challenging the validity of the impugned section is really covered by the earlier decision of this Court.
Mr. Shukla, however, contends that the preamble to the Act differs from the preamble of the Bombay Act inasmuch as the latter preamble refers to the fact that that Act was passed inter alia for the purpose of improving the economic and social conditions of peasants and ensuring the full and efficient use of land for agriculture and so considerations of social justice on which the validity of the corresponding provision of the Bombay Act was sought to be sustained cannot be invoked in dealing with the present appeal.
, We are not impressed by this argument.
It is true that the preamble to the Act merely says that the Act was passed because it was though necessary to regulate the law which governs the relations of landlords and tenants of agricultural lands and it does not refer to the requirement of social justice or does not specifically mention the object of ensuring the full and efficient (1) ; 233 use of land for agriculture.
But in dealing with a law which has been passed for the purpose of effecting an agrarian reform it would be pedantic to ignore the essential basis of its material provisions merely on the ground that the concept of social justice on which the said provisions are based has not been expressly stated to be one of the objects of the Act in the preamble.
We have already examined briefly the broad scheme of the Act and it is obvious that the important provisions of the Act are intended to improve the economic and social conditions of the agricultural tenants and so the policy of social justice can be safely said to be writ large on the face of the Act.
Therefore, we do not think that the argument based upon the fact that the preamble does not refer to social justice distinguishes section 6 of the Act from the corresponding section of the Bombay Act.
Then it is urged that unlike the Mysore Act, the Bombay Act has distinguished between irrigated land and non irrigated land and has provided by section 6(1) that the maximum rent payable in the case of irrigated land shall not exceed one forth and in the case of other lands shall not exceed one third of the crop of such land or its value as determined in the prescribed manner.
It is true that section 6(1) of the Act makes no such distinction between irrigated and non irrigated lands.
But that, in our opinion, is not a matter of essential importance.
Like section 6(1) of the Bombay Act section 6(1) of the Act also intends to provide for a maximum ceiling beyond which agricultural rent will not be allowed to soar and so far as the fixation of a maximum ceiling of rent is concerned it is not essential that a distinction must necessarily be made between.
irrigated lands and non irrigated lands.
It must be borne in mind that what the section does is to prescribe the maximum and not to provide for a minimum In prescribing a maximum it may be open to the Legislature to provide for a maximum which would be 234 common to all lands whether irrigated or not, That is why we are not inclined to attach any importance to the point that in the absence of classification of land, while prescribing a maximum section 6(1) suffers from any infirmity.
Then it is argued that the Bombay Act while prescribing a maximum has taken the precaution of also prescribing a minimum and the absence of the latter provision makes a material difference.
This argument is clearly misconceived.
It is true that section 8 of the Bombay Act which had been inserted by the Bombay Legislature in 1956 did provide for the maximum and the minimum rent, but as the decision of this Court in the case of Sanjanwala (1) shows in upholding the validity of the impugned provision of the Bombay Act no reliance was placed upon the fixation of the minimum rent.
Indeed, the minimum rent was fixed subsequent to the decision of the High Court which was under appeal before this Court in that case and the fact that a minimum had been prescribed subsequently has been only incidentally mentioned in the judgment.
Therefore the absence of a provision fixing the minimum rent does not introduce any infirmity in the impugned provision.
We are, therefore, satisfied that the case of the impugned section is substantially similar to the case of section 6 of the Bombay Act with which this Court was concerned in the case of Sanjanwala (1) and the challenge to the validity of section in the present appeal must, therefore, be held to be covered by the said decision.
That takes us to the question as to whether the impugned notification is invalid.
This notification has been issued in exercise of the powers conferred on the State Government by section 6(2) and it provides that the rate of maximum rent payable by the tenants of lands situated in the areas specified in Schedule I and Schedule If to the notification 235 shall be one third and one fourth respectively of the crop or crops raised on such lands with effect from the year commencing on April 1, 1955.
Schedule I deals with Maidan areas in which the maximum rent or rents shall be one third of the, crop or crops and Schedule If deals with Malanad areas in which the maximum rate of rent shall be one fourth of the crop or crops raised.
It appears that the classification of lands between Maidan an Malanad lands is well known in Mysore.
Maidan lands are lands on the plains, whereas Malanad are lands on hilly tracts.
The distinction between the two categories of lands takes into account the different conditions of rain fall, the different nature of the cultivation, the difference ' in the living conditions and the availability of labour and the difference in the quantity and the quality of the produce.
It is true that the notification does not prescribe the lower rate of the maximum rent area by area in the sense of district by district, but it purports to prescribe the said maximum by classifying the land in the whole of the State in the two well known categories of Maidan and Malanad lands.
It is urged by Mr. Shukla that the impugned notification is invalid, because it is inconsistent with the provisions of section 6(1).
The argument is that section 6(1) lays down a general rule and section 6(2) provides for an exception to the said general rule.
On that assumption it is contended that an exception cannot be allowed to swallow up the general rule and that is precisely what the notification purports to do.
This argument is based on the decision of the House of Lords in Macbeth vs Ashley It would be noticed that this argument raises the question about the construction of the two sub clauses of s.6.
Before addressing ourselves to that question, (1) [1874] L.R. 2 SC.
236 however, we may refer to the decision of the House of Lords on which the argument is based.
It appears that II o 'clock at night was the hour appointed for closing public houres in Scotland, although in special cases, and for well considered reasons, a deviation was allowed with reference to any particular locality really requiring it.
The Magistrates of Rothesay had ordered for closing at 10 instead of 11 and the effect of the order was that it embraced every public house in the burgh.
The House of Lords held that the Magistrates order .was ultra vires.
The statutory provision with which the House of Lords was concerned was contained in the Act of Parliament, 25 and 26 Vict.
c. 35.
As a result of these provisions 11 o 'clock at night was appointed to be the hour for closing public houses.
There was however, a proviso which said inter alia that in any particular locality requiring other hours for opening and closing inns, hotels, and public houses it shall be lawful for such justices and Magistrates respectively to insert in the schedule such other hours, not being earlier than six or later than eight o 'clock in the morning for opening,, or earlier than nine o 'clock or later than eleven o 'clock in the evening for closing the same as they shall think fit.
It is in pursuance of the authority conferred on them by the said proviso that the Magistrates of Rothesay passed an order embracing every public house in the burge by which a deviation from the statutorily fixed hour was effected.
In dealing with the validity of the order issued by the Magistrates Lord Chancellor Lord Cairns expressed his opinion that if the exception is to swallow up the rule it ceases, of course, to be an exception at all and that which might fairly have been an exercise of discretion becomes no exercise of the kind of discretion mentioned in the Act of Parliament.
It was for this reason that the order 237 issued by the Magistrates was declared to be ultra vires.
It was conceded that the Magistrates had a discretion, but the Lord Chancellor observed that the words "conferring discretion" expressly bear with reference to a particular locality and not with the whole burgh.
What should be true about the whole burgh had been treated as a matter reserved for and determined by the consideration of the Imperial Parliament.
The Lord Chancellor did not express any opinion on the question as to whether the discretion vested in the Magistrates can be exercised by them more than once but without deciding that point he held that the order of the Magistrates really amounted to evading an Act of Parliament.
In substance, the Magistrates had once for all attempted with regard to all the public houses in their district to change the rule laid down by the Act of Parliament.
Lord Chelmsford, who concurred with the opinion expressed by the Lord Chancellor, rested his conclusion on the ground that it was impossible to say that the limits which the Magistrates had defined could be called a particular locality within burgh and so it appeared that what the Magistrates had done was something very like an attempt to evade the Act of Parliament.
According to Lord Selborne, the participle "requiring" is connected with the substantive "locality" and therefore it must be a requirement arising out of the particular circumstances of the place.
That is why Lord Selborne thought that the Magistrates must in exercise of an honest and bona fide judgment, be of opinion that the particular locality which they ex(opt from the ordinary rule is one which, from its own special circumstances, requires that difference to be made.
It would thus be seen that though the general basis of tHe decision, as it has been expressed by Lord Cairne, appears to be that the exception cannot swallow up the rule one of the reasons which 238 ultimately influenced the decision was that the discretion had to be exercised bona fide and after due deliberation in respect of a particular locality and that the manner in which the order was issued indicated that the requirements of the particular localities had not been duly examined by the Magistrates.
It is significant that though Lord Cairns posed the question as to whether the discretion in question can be exercised more than once, he did not choose to answer it; but the trend of the opinions expressed by the Law Lords during the course of their speeches may seem to suggest that the discretion cannot be exercised more than once and in any case, it must be exercised by special reference to the particular locality as indicated by the proviso.
If an order is made in respect of the whole of the burgh, it cannot be said that it has been passed after exercising due discretion in respect of the requirements of each particular locality.
With respect, if the discretion is given to the Magistrates to provide for a departure from the rule prescribed by the general provision by reference to particular localities, it is not easy to see why the said discretion cannot be exercised more than once.
Indeed, situations may arise when the Magistrates may have to consider the matter from time to time in respect of different localities and if it appears to the Magistrates considering the cases of different localities that in regard to each one of them a departure from the general rule should be made, it is not easy to follow why the proviso does not justify different orders being passed by the Magistrates in respect of different but particular localities.
On the other hand, if the main provision is construed to mean that the time prescribed by it was to apply generally only with certain exceptions contemplated by the proviso, that would be a different matter.
However, it is not necessary for us to pursue this point further and to express a definite 239 opinion on the general proposition that an exception cannot swallow the general rule because, as we will presently show, this rule cannot be applied to the provisions of section 6 at all.
In this connection we may, however, point out that both in Max a well and in Craies, the decision in Macbeth 's case (1) appears to have been treated as an authority for the proposition that an order like the one passed by the Magistrates in that case amounted to an evasion of the Parliamentary statute, because it was not in honest and bona fide exercise of the discretion vested in them.
(Maxwell on Interpretation of Statutes, 11th Edn., p. 121, and Craies on Statute Law, 5th Edn., p. 75.) But assuming that the proposition for which Mr. Shukla contends on the authority of the decision in Macbeth 's case (1) is sound, does it apply to section 6 at all and the answer to this question will depend upon the construction of the provisions contained in the two sub clauses of section 6.
It would be noticed that section 6(1) declares a maximum beyond which no landlord can recover rent from his tenant.
In other words, as soon as the Act came into force a ceiling was fixed beyond which the landlord cannot recover rent from his tenant even though it may be justified by agreement, usage, decree or order of a court or any other law, The provisions of this sub section apply individually and severally to all agricultural leases and govern the relations of individual landlords and tenants in respect of payment of rent by the latter to the former.
The fixation of the maximum by sub section
(1) is really not intended to lay down a general rule as to what a landlord should recover from his tenant and it is in that sense alone that its relation to the provisions of sub section
(2) must be judged.
In that connection we may point out that there is one proviso to (1) (1874) L. R. 2 S.C App 352.
240 cultivate the land and it lays down that in their case the rent shall be reasonable rent to be fixed by the Amildar.
Sub section (2) is so worded that in terms it cannot be said to be a proviso to sub section
(1) add in substance it is not such a proviso nor is it an exception to sub section
Having prescribed the maximum beyond which agricultural rent cannot go under a. 6(1) the legislature has premitted the Government to fix a lower rate of the maximum rent in respect of lands situated in particular areas.
The Government has also been authorised to fix the payment of rent on any other suitable basis as it thinks fit.
In other words, the authority conferred on the Government is either to fix a lower rate or to fix any other basis on which the rent could be fixed.
The provision is an independent provision and so the two sub sections must be read as different, independent, though coordinate, provisions of the Statute.
It would, we think, be erroneous to treat sub section
(2) as a proviso or exception to sub section
Whereas sub.a.
(1) deals with and applies to all leases individually and prescribes a ceiling in that behalf, sub section
(2) is intend to prescribe a maximum by reference to different areas in the State.
The object of both the provisions is no doubt simi lar but it is not the same and the relation between them cannot legitimately be treated as the relation between the general rule and the proviso or exception to it.
The argument that by issuing the notification the Government has purported to amend a. 6(1) is, in our opinion, not well founded.
As we have already seen, a. 6(1) is intended to apply to all the agricultural leases until a notification is issued under a. 6(2) in respect of the areas where the leased lands may be situated.
It is not suggested that 241 under section 6(2) it is necessary that the Government must fix the lower rates by reference to individual lands and so there can be no doubt that even on the appellant 's argument it would be competent to the Government to fix lower rents, say districtwise.
If instead of prescribing the lower rates districtwise after classifying the lands into two categories which are well recognised, the Government prescribed the rates by reference to the said categories of lands throughout the State, we do not see how the said notification can be said to be inconsistent with section 6(2) or with section 6( 1) either.
The scheme of section 6 does not seem to postulate that after the notifications are issued under section 6(2) some area must inevitably be left to be covered by section 6(1).
Such an assumption would be inconsistent with the object underlying the said provision itself.
What section 6(1) has done is to fix a general ceiling apart from the areas and without considering the special factors appertaining to them.
Having thus fixed a general ceiling the Legislature realised that the ceiling may have to be changed from area to area and so power was conferred on the Government to fix the ceiling at a lower rate, The Government having examined the matter came to the conclusion that the more equitable and reasonable course to adopt would be to divide the agricultural lands into two well known categories and fix the ceiling by reference to them.
Now in the very nature of things, the Legislature must have anticipated that the exercise of the power under a. 6(2) might cover all the areas in the State and that may mean that the general ceiling prescribed by section 6(1) may not apply to any land which is covered by the notification.
If section 6(1) is not a general rule and section 6(2) is not an exception to it, then the consequence flowing from the issue of the impugned notification cannot be characterised as an exception swallowing up the 242 general rule.
That, in substance, is the view which the Mysore High Court has taken in the matter and we think that the said view is right.
In the result.
, the appeal fails and is dismissed with costs.
Appeal dismissed.
[/INST]The Amritsar Improvement Trust framed a scheme under section 3 of the Punjab Development and Damaged Areas Act, 1951, which empowered it to frame a scheme for the development of a damaged area, It passed a resolution to acquire certain property of the appellant for widening a road under the scheme.
The appellant contended that the scheme was without jurisdiction as the area was not a "damaged area" within section 2 (d) of the Act which contemplated only two classes of areas, i. e. (i) areas which may, by notification, under the Act be declared by the Government to be "damaged areas", and (ii) areas already notified under the Punjab Damaged Areas Act, 1949.
The respondents contended that a notification 243 issued under the Punjab Damaged Areas Act, 1947, which declared the entire walled City of Amritsar as a "damaged area" should be deemed to be a declaration" under the 1949 Act because of the operation of section 22 of the Punjab General Clauses Act and was sufficient to sustain the scheme and that the scheme could not be challenged as it had been notified by the State Government and under section 5 (4) of the Act the publication was conclusive evidence that the scheme had been duly framed and sanctioned.
Held, that the scheme was without jurisdiction and that the proceedings for the acquisition of the appellant 's property were illegal.
Admittedly the area had not been declared a "damaged area either under the 1951 Act or under the 1949 Act.
The declaration under the 1947 Act was of no avail, firstly, because there was no basis for the argument that it would be "deemed to be a declaration" under the Act of 1949 and secondly even if it were so deemed the same was not within the definition of damaged area" in the Act of 1951.
The appellant was not precluded by section 5 (4) from challenging the scheme and the acquisition ; since the collusiveness postulated by section 5 (4) was only in respect of the formalities prescribed by sections 3,4 and 5 and did not touch a case where there was complete lack of jurisdiction in the authorities to frame a scheme.
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<s>[INST] Summarize the judgementCivil Appeal No. 626 of 1975 etc.
From the Judgment and Order dated 28.7.
1972 of the Calcutta High Court in Civil Rule No. 2029 of 1967.
P.K. Mukherjee.
D.N. Mukherjee, N.R. Choudhary.
Ranjan Mukherjee.
Somnath Mukherjee.
for the Appellants.
Sukumar Ghosh.
D.P. Mukherjee and G.S. Chatterjee.
for the Respondents.
The Judgment of the Court was delivered by RANGANATHAN, J.
All these cases involve a common point which has been decided by a Full Bench of the Calcutta High Court reported as Madan Mohan Ghosh vs Shishu Bala Atta, AIR 1972 Cal.
Civil Appeal No. 626/75 is a direct appeal from the judgment of the Full Bench in one of the batch of cases dealt with therein.
In the other cases, the High Court has decided the matter by following the Full Bench decision and that is the subject matter of appeal before this Court.
Basically, the question is whether the right of pre emption conferred on co sharers under the Bengal Tenancy Act, 1885 (hereinafter referred to as 'the Tenancy Act '), is available to the holders after their interests in the holding have vested in the Government under the West Bengal Estates Acquisition Act, 1953 (hereinafter referred to as 'the 1953 Act ').
This question has been answered by the Full Bench (Coram: A.K. Mukherjea, Sabyasachi Mukharji and M.M. Dutt, JJ.) in the negative and it is the correctness of this conclusion that is assailed in these proceedings.
To provide a factual background it may be sufficient to set out the brief facts in C.A. No. 626/75.
The respondent, Smt.
Gangamoni Mondal, purchased, on 29.
1963, the suit property being land measuring about 15 acres.
She excavated a portion of the land, filled up other portions of it, constructed a small structure thereon and started living there from 1964.
About three years and five months after her purchase, Ardhendu Bhusan Halder, the predecessor in inter est of the appellants, made an application for pre emption under section 26 F of the Tenancy Act.
His case was that he was a Co sharer Of the holding which comprised the land purchased by the respondent.
The holding was previously a Raiyati Mokarari interest and it had vested in the State under the provisions of the 1953 Act.
The case of the re spon 530 dent was that.
though the predecessor in interest of the appellant and her vendor were the joint holders of the property in question.
the right of pre emption available to the co sharer had ceased with the coming into force of the 1953 Act.
The pre emption.
application was allowed by the learned Munsif and his order was confirmed by the learned Additional District Judge.
The respondent moved the High Court in revision.
The matter came up for hearing before the two learned Judges of the Calcutta High Court who referred the matter to the Full Bench.
The question.
as already stated.
was answered by the Full Bench in the negative with the result that the application for preemption stood dis missed.
Hence the appeal before us.
The other appeals before us also involve the same point but there are some difference.
We shall refer to these aspects later, to the extent necessary.
The question raised lies within a very narrow compass.
The relevant statutory provisions may first be set out.
As already mentioned, the Tenancy Act provides, in section 26 F. that except in the case of a transfer to a co sharer in the tenancy whose existing interest has accrued otherwise than by purchase, one or more cosharer tenants of the hold ing, a portion or share of which is transferred.
may apply to the Court for the said portion or share to be transferred to himself of themselves.
In other words, the section con ferred, On a co sharer tenant of an occupancy holding, a right to compel another co sharer tenant to sell his share in the holding to him instead of to a stranger.
The term "co sharer" envisages that the holding must be under the ownership of more than one person.
The holding must be an OCCupanCy holding: that is.
it must be the holding of raiy ats having occupancy rights.
So long as a division of the holding does not take place in accordance with section 88 of the Tenancy Act.
the holding remains a joint holding and each co sharer will be entitled to pre empt in case of transfer of a share or portion of the holding by a co sharer to a stranger.
The 1953 Act came into force on February 12, 1954.
Sub section (1) of section 4 of the Act provides that the State Government may from time to time by notification declare that with effect from the dale mentioned in the notifica tion.
all estates and the rights of every intermediary in each such estate situate in any district or part of a dis trict specified in the notification shall vest in the State free from all incumbrances.
Pursuant to section 4(1), a notification was published, which prescribed the date of vesting as 15th April.
The term 531 "intermediary" was defined in the Act to mean "a proprietor, tenureholder.
under tenure holder or any other intermediary above a raiyat or a non agricultural tenant ' '.
Thus a raiyat was not an intermediary.
However, Chapter VI of the Act contains provisions for acquisition of interests of raiyats and under raiyats.
Under section 49, the provisions of Chapter VI were to come into force on such date and in such district or part of a district as the State Government may, by notification in the Official gazette, appoint.
The notification under section 49 was published on 9th April, 1956, by which Chapter VI was brought into force in all the districts of West Bengal with effect from April 10, 1956.
The effect of such a notification was that the provisions of the earlier Chapters of the Act became operative mutatis mundandis "to raiyats and under raiyats as if such raiyats and under raiyats were intermediaries and the land held by them were estates and a person holding under a raiyat or an under raiyat were a raiyat for the purpose of clauses (c) and (d) of section 5." Notifications were issued under section 4 by the State Government as a result of which the interests of raiyats and under raiyats vested in the State with effect from April 14, 1956.
As already mentioned, the effect of 1953 Act was to vest the rights of intermediaries (an expression subsequently extended to cover raiyats and under raiyats) in the State Government.
However, section 6 confers certain rights on the intermediaries to retain certain lands.
The relevant por tions of section 6 can be extracted for purpose of conven ient reference.
Right of intermediary to retain certain lands.
(1) Notwithstanding anything contained in sections 4 and 5, an intermediary shall, except in the cases mentioned in the proviso to sub section (2) but subject to the other provi sions of that sub section, be entitled to retain with effect from the date of vesting (a) land comprised in homesteads; (b) land comprised in or appertaining to buildings and structures, owned by the intermediary or by any person, not being a tenant, holding under him by leave or licence.
XXX XXX XXX (c) non agricultural land in his khas possession, including land held under him by any person not being a tenant, by 532 leave or licence, not exceeding fifteen acres in area, and excluding any land retained under clause (a); Provided that the total area of land retained by an interme diary under clauses (a) and (c) shall not exceed twenty acres, as may be chosen by him: Provided further that if the land retained by an intermedi ary under clause (c) or any part thereof is not utilised for a period of five consecutive years from the date of vesting, for a gainful or productive purpose, the land or the part thereof may be resumed by the State Government subject to payment of compensation determined in accordance with the principles laid down in section 23 and 24 of the Land Acqui sition Act, 1894 (Act I of 1894); (d) agricultural land in his khas possession not exceeding twenty five acres in area.
as may be chosen by him; Provided that in such portions of the district of Darjeeling as may be declared by notification by the State Government to be hilly portions, an intermediary shall be entitled to retain all agricultural land in his khas possession, or any part thereof as may be chosen by him." In other words.
broadly speaking, the intermediary was allowed to retain agricultural land upto the extent of twenty five acres and nonagricultural land to the extent of fifteen acres, leaving out the special provisions in respect of homesteads, lands on which buildings are put up and lands in the hilly areas of Darjeeling.
Section 52 while applying these provisions to raiyats and under raiyats, states: "Provided that where raiyat or an under raiyat retains.
under section 6 read with this section.
any land comprised in a holding, then notwithstanding anything to the contrary contained in sub section (2) of section 6, he shall pay : (a) in cases where he was paying rent for the land comprised in the holding and held by him immediately before the date of vesting (hereafter in this proviso referred to as the holding lands), (i) if he retains all the holding lands, the same rent as he 533 was paying therefore immediately before the date of vesting, and (ii) if the land retained by him forms part of the holding lands, such rent as bears the same proportion to the rent which he was paying for the holding lands immediately before the date of vesting as the area of the land retained by him bears to the area of all the holding lands; (b) in cases where he was liable to pay rent but was not paying any rent for the holding lands immediately before the date of vesting on the ground that the rent payable by him therefore was not assessed, such rent as may be assessed, mutatis mutandis, in accordance with the provisions of section 42; (c) in cases where he was liable to pay rent wholly in kind or partly in kind and partly in cash, then notwithstanding anything contained in clause (c) of section 5, such rent as may be assessed in accordance with the provisions of section 40, and (d) in cases where he was liable immediately before the date of vesting to pay for the holding lands a variable cash rent periodically assessed, such rent as may be assessed, mutatis mutandis in accordance with the provisions of section 42.
" By a notification dated 28.5.
1984, the Government of West Bengal framed rules called the West Bengal Estates Acquisition Rules.
1954 (hereinafter referred to as 'the rules ').
Rule 4 originally provided that: "every intermediary who retains possession of any land by virtue of the provisions of sub section (1) of section 6, shall, subject to the provisions of the Act, be deemed to hold such land from the date of vesting (a) If it is agricultural land, on the same terms and condi tions as an occupancy raiyat under the Bengal Tenancy Act, 1885; (b) If it is non agricultural land on the same terms and 534 conditions as a tenant under the West Bengal Non agricultur al Tenancy Act, 1949, holding non agricultural land for not less than 12 years without any lease in writing.
" The following rule 4 was substituted for the above rule by a notification dated 7th September, 1962: "4.
Any land retained by an intermediary under the provi sions of sub section (1) of section 6 shall, subject to the provisions of the Act be held by him from the date of vest ing on the terms and conditions specified below: XXX XXX XXX (3) if the land held by the intermediary be agricultural land, then (1) he shall hold it, mutatis mutandis, on the terms and conditions mentioned in sections 23, 23A, clause (a) of section 25, sections 26 to 26G . " The rule was again amended by a notification dated August 1, 1964 by which, for the words and figures "Sections 26 to 26G, 52 to 55", the words "sections 26, 26B, 26C, 26G, sections 52 to 55" were substituted.
In other words, the original rule 4 merely provided that in the case of agricul tural land retained by the intermediary, he shall hold it on the same terms and conditions as an occupancy raiyat under the Tenancy Act leaving it undefined as to whether these terms and conditions would also include the right of pre emption available under the Act.
The amendment of 1962 specifically included the right of preemption available under section 26 F but the reference to section 26 F was omitted by the amendment of 1964.
The provisions of these various enactments and the availability of the right of pre emption to the former joint tenants of the holding came up for consideration before a number of Benches of the Calcutta High Court.
It is not necessary to refer to the details of these decisions inas much as the matter has been considered at length by the Full Bench.
The arguments addressed in support of the survival of the right of pre emption despite these legislative changes were broadly these: (i) The 1953 Act, after Chapter VI came into force only vested the holding of the raiyats and under raiyat in the State.
The word 535 'intermediary ' in section 6 ' includes the plural 'intermedi aries '.
Hence, the previous co sharers continue to be co sharers; only instead of being tenants under an intermedi ary, they become tenants under the State.
The vesting is of the holding as a whole; its integrity is not impaired.
(ii) The Act, the rules and the forms prescribed thereunder provide for the partition, demarcation, separate determina tion of the rents for the lands so partitioned and demarcat ed and consequent modification of the record of rights; until all this is done, the holding remains single and the erstwhile co sharers continue to be such.
(iii) Rule 4(3), as it originally stood, preserved the rights of tenants to co sharers.
The 1962 amendment made this clear.
The 1964 deletion of the reference to section 26 F was not with a view to take away the right of pre emption under section 26 F.
It was only consequential to the enactment of the 1955 Act, section 8 of which provided for a pre emption right corresponding to section 26 F of the Tenancy Act.
The Full Bench, however, repelled the contentions and held that the right of pre emption did not survive.
Its reasons may be summarised thus: (1) By virtue of section 52, read with section 6, each raiyat becomes a direct tenant under the State with effect from the date of vesting in respect of the land which he is entitled to retain.
The proviso to the section provides for the apportionment of the rent among the various holders making it clear that the land retained by a raiyat of a holding becomes the subject matter of a separate tenancy.
It was, therefore, no longer possible to call them co sharers.
Each became entitled to a direct tenancy in respect of a share of the previous holding and, in regard to his inter est, the previous holders had no manner of right or title.
One raiyat could not claim to have any interest in the land comprising the holding which the others are entitled to retain or have retained.
Before vesting, each of the raiyats of a holding had an interest or share in every part of the land comprised in the holding and each was a co sharer of the other, but this is not the position after the vesting when each of the raiyats of the holding becomes a direct tenant under the State in respect of the land of the holding which he is entitled to retain under the provisions of sub section ( 1 ) of section 6. 536 (2) The expression "an intermediary" in sub section (1), (2) and (5) of section 6 cannot be read as including the plural.
If the word "intermediaries" was substituted in the place of "an intermediary" in sub section (1) of section 6 the result will be that all the intermediaries would be jointly entitled to retain only 25 acres of agricultural land in his khas possession whereas clause (d) envisages that each intermediary is entitled to retain 25 acres of agricultural land in his khas possession and to exercise his choice of retention of land within such time and in such manner as may be prescribed.
The forms prescribed under the schedule in this connection and the foot notes thereto make it clear beyond all doubt that each intermediary separately, and not the intermediaries jointly, could exercise their choice of retention.
This was clear from clauses (iii), (iv), (v) and (vi) of the foot notes appended to the form.
This Was also the only reasonable interpretation for differ ent co sharers of a holding may have other lands in their possession and unless the right of choice and the computa tion of 25 acres is separately read into the provisions it would be impossible to work the same.
(3) While it is true that on the vesting no partition of any holding is effected and the various records are also not immediately corrected, the definition of 'holding ' in the Tenancy Act clearly shows that an undivided share in land can be the subject matter of a separate tenancy and can constitute a holding of a raiyat or a under raiyat.
There fore, though the land remains undivided till it is demarcat ed by metes and bounds there is nothing wrong in saying that the undivided share for a raiyat becomes the subject matter of a separate tenancy directly under the State as from the date of vesting.
Merely because the finally published re cord of rights has not been drawn up under section 47 read with rule 31A, it cannot be said that the holding continues to be a joint holding or that the raiyats continue to be the co sharers of each other.
(4) It is true that the expression "terms and condi tions" in rule 4 includes the right of pre emption under section 26 F and section 26 F has also been specifically included within the meaning of Rule 4(3) as amended in 1962.
However, the exercise of a right of pre emption under sec tion 26 F is conditional on the person claiming to exercise the right being a co sharer of the holding a portion or share of which has been transferred to outsider.
In view of the conclusion that the individual co sharers of the holding cease to be co sharers after the vesting, there will be no scope for any application under section 26 F. This, however, does not mean that rule 4(3) as amended in section 537 26 F is redundant.
It may be that on the date of vesting there may be no co sharer in a raiyati holding.
But, where after the date of vesting, the individual holder dies and a number of co sharers come into being by devolution of his interest, the provisions of section 26 F read with rule 4(3) will come into play.
Similarly, if subsequent to the date of vesting, one of the erstwhile co sharers transfers a portion of his holding to another, that person becomes a co sharer of the holding along with his vendor.
If one of these two co sharers transfers a portion of the holding to another person, section 26 F will apply.
Thus section 26 F has a part to play even in the new scheme of things and is not rendered otiose or redundant by the findings given earlier.
(5) It is true that sub rule (3) of rule 4 was further amended on 1st August, 1964, deleting the reference to section 26 F in that sub rule.
This deletion, however, did not mean that the right of preemption has been taken away.
This amendment took place because the West Bengal Land Reforms Act, 1955, by section 8 created a right of pre emption similar to the one conferred by section 26 F.
This section came into force on 22nd October, 1963.
Initially there were some differences between section 26 F and section 8 of the West Bengal Land Reforms Act in that, under the former, the application had to be made to the Court while, under the later, it had to be made to the Revenue Officer.
After the enforcement of section 8 it became wholly unneces sary to allow section 26 F to remain in sub rule (3) of rule 4.
It took some time for this amendment to be given effect to.
Section 8 will apply regarding transfers taking place after the enforcement of section 8.
We have heard arguments on behalf of several counsel in respect of the points at issue in these appeals.
The Full Bench judgment of the Calcutta High Court has discussed all the various aspects and it has come to the conclusion for the reasons summarised above, and elaborated by it, that the right of pre emption could not survive the 1953 Act.
Counsel have been unable to persuade us to take a view different from that of the Full Bench.
We, therefore, express complete concurrence with the views of the Full Bench.
We would also like to point out that the decision of the Full Bench has been in force in the State of West Bengal since 1972.
Interests in land must have been transferred during the past eighteen years on the basis that the princi ples of the Full Bench decision would apply.
So, even if there were any force in the contention urged on behalf of the appellants and as we have already pointed out, no 538 grounds have been urged before us strong enough to persuade us to differ from the Full Bench we would have been very reluctant to alter the legal position as settled for a very long time in the State of West Bengal by the decision of the High Court.
By this observation we should not be understood to have expressed any reservations on our part in accepting the Full Bench decision as correct.
On the other hand, having considered the pros and cons urged before us, which had also been urged before the High Court, we are in full agreement with the Full Bench decision.
We, therefore, affirm the judgment of the Full Bench.
In the light of the above discussion, we may now consid er the several appeals before us: (1) C.A. 626/75 is a direct appeal from the Full Bench judgment.
It stands dismissed.
Sri Ghosh, for the respondents, also urged that the application for pre emption in the present case was made section 26 F of the Tenancy Act which had ceased to be effec tive after 1964 amendment and hence should have been reject ed.
He also contended that section 26 F could be availed of only in respect of an occupancy raiyat whereas the interest transferred in the present case was a "mokarari" interest.
These points do not appear to have been raised in the High Court.
Anyhow, it is unnecessary to go into these conten tions as we have held, even otherwise, that the application for pre emption is not maintainable.
(2) C.A. 291 of 1976 A11 the Courts have concurrently applied the Full Bench decision.
The appeal, therefore, fails and is dismissed.
(3) C.A. 2449/80 1n this matter, the land in question is nonagricultural land.
The High Court held that the Full Bench decision relates only to agricultural lands and that the interests of non agricultural tenants remains unaffected by the 1955 Act.
This point requires a little consideration.
So far as non agricultural tenancies are concerned, a right of pre emption among co sharers was conferred by section 24 of the West Bengal Non agricultural Tenancy Act, 1949.
We have earlier seen that the 1953 Act originally provided for vesting only of the interest of 'intermediaries ' in the State and the definition of 'intermediary ' took in only a holder above 'a raiyat or under raiyats ' in respect of agricultural land and above 'a non agricultural tenant '.
The rights of 539 'raiyats and under raiyats ' were brought within the purview of the vesting provisions when Chapter VI of the 1953 Act was brought into force; but there is no statutory provision that brings non agricultural tenants within the scope of the vesting provisions.
This has been pointed out by this Court in Shibasankar vs Prabartak Sangha, at p. 563 which has been followed in a number of decisions of the Calcutta High Court and applied, after the Full Bench deci sion, in Sastidas Mullick vs J.L.R.O. Parrackpore Circle and Ors., at p. 701 by a Bench comprising of Sabyasachi Mukharji and M.M Dutt.
The High Court, in our view, was right in making the distinction and upholding the right of pre emption in this case.
The appeal.
therefore.
fails and is dismissed.
(4) C.A. 825/81 This is a case for claim of pre emption under section 8 of the 1955 Act.
It is necessary to set out a few facts.
The lands in R.S. Khatian No. 331 belonged to four brothers Jadhunath, Madhusudan.
Siddeshwar and Maniklal.
Later, Madhusudhan died and his interest devolved on his father Ashutosh and his brother Mukti.
Siborani purchased plot Nos.
1947, 2199 and 363 in this khatian by a registered deed dated 28/5/68 from the holders.
The second petitioner purchased plot No. 2169 in the khatian on 19.5.69 from the holders.
The respondent Shravani Ghosh is a stranger who purchased the disputed property from Jadhunath, Siddeswar and Maniklal by a deed dated 4.5.71.
Subsequently, a deed dated 21.6.71 was executed in her favour by Maniklal and Ashutosh purportedly to rectify a defect in the earlier deed.
Thereupon, the purchasers under the earlier deeds, Siborani and another claimed a right of pre emption under section 8 of the 1955 Act.
The application was allowed by the Munsif and the District Judge but disallowed, on revision, by the High Court.
Learned counsel for the appellant contended that the present case 'fell within the exceptions outlined in the Full Bench case, under which the right of pre emption sur vives.
He relied, in support of this contention, on sub paras (2) and (3) in the following passage from the Full Bench judgment, where the High Court summed up its conclu sions: "28.
For the reasons aforesaid, we hold as follows (1) After the enforcement of Chapter VI of the Act and the vesting of interest of raiyats and under raiyats on and from April 14, 1956 corresponding to Baisakh 1, 1363 B.S. the co sharer raiyats of a holding ceased to be coshar ers and each raiyat of the holding became a direct 540 tenant under the State in respect of the land of that hold ing which he is entitled to retain under sub section (1) of section 6.
As the co sharer raiyats ceased to be co sharers on and from the date of vesting the question of exercise of the right of pre emption under section 26 F cannot arise, for, the condition precedent to the exercise of the right of pre emption under Section 26 F being that the person exercising that right must be a co sharer of the person making the transfer.
(2) When a raiyat having a separate holding or tenancy created by virtue of sub section (2) of section 6 relating to the land retained by him under sub section(1) of section 6 dies leaving more than one heir, such heirs will become co sharers of such holding and will be entitled to the right of preemption under Section 26 F. Similarly, when the raiyat of such a holding transfers a portion of the holding to another person, that person will become a co sharer of the raiyat and the right of pre emption will also be available in such a case.
(3) A transfer made by a co sharer raiyat as contemplated by CI.
(2) above before the enforcement of Section 8 of the West Bengal Land Reforms Act, 1955, may be pre empted by another co sharer in the tenancy in accordance with Section 26 F, but a transfer made after the enforcement of Section 8, the right of pre emption by a co sharer can only be exercised in the manner laid down in Section 8 of the West Bengal Land Reforms Act.
(4) The under raiyats have been elevated to the status of raiyats on the enforcement of Chapter VI.
There is no dif ference between the position of raiyats and that of under raiyats and our decision on the question as to the effect of the enforcement of Chapter VI on the right of pre emption of raiyats will also apply to under raiyats.
(5) The decisions in 68 Cal.
W.N. 574 (A.I.R. 1964 Cal.
460) and Jyotish Chandra Das vs Dhananiay Bag., [1964] 68 Cal.
W.N. 1055 in so far as they proceeded on the footing that the raiyats of a holding continued to be co sharers even after vesting, are erroneous but they have correctly inter preted the expression 'terms and conditions ' in Rule 4." 541 Learned counsel for the respondents, on the other hand, contended that, while the first instance given in sub para (2) above by the Full Bench may be correct, the second instance and its follow up in subpara (3) are not correct.
He pointed out that once each co sharer in the earlier holding is held to become an independent tenant directly under the State, any alienee from him acquires his interest pro tanto and cannot become his co sharer.
His submission was that the Full Bench has erred in considering them to be co sharers.
It is not necessary to express any views on this contention as, in our opinion, the above observations are not applicable on the facts found in the present case.
Here the "co owners" of the former R.S. Khatian 313 have sold identifiable plots under different sale deeds to different parties.
In this state of affairs, the transferees under the 1968 and 1969 deeds have acquired title to identifiable plots and are not co sharers in the original transferors.
There is no question of their claiming pre emption as against the transferees under the 1971 documents merely because all the plots at one time formed part of one inte gral holding.
We are, therefore, of opinion that the High Court was correct in holding that no right of pre emption could be exercised by the petitioners.
This appeal, there fore, fails and stands dismissed.
(5) C.A. 2231/82 This appeal has to be dismissed in view of our order upholding the Full Bench decision.
We direct accordingly.
(6) S.L.P. (Civil) 1037/74 1n this case, the High Court, following the Full Bench decision, held that the petitioner was not entitled to claim pre emption.
The peti tion has, therefore, to be dismissed.
We order accordingly.
(7) S.L.P. (Civil) 1577/74 The High Court disposed of this matter by following the Full Bench decision.
The deci sion is affirmed and this petition dismissed.
(8) S.L.P. (Civil) 9882/80 Since the High Court has only followed the Full Bench decision, there are no merits in this appeal which is dismissed.
All the appeals and SLPs, therefore, fail and are dis missed.
But in the circumstances we make no order as to costs.
R.S.S. Appeals and SLPs dismissed.
[/INST]Gangamoni Mondal, the respondent in one of the appeals, purchased on 29.1.1963 the suit property.
About three years and five months after her purchase, the prede cessor in interest of the appellants made an application for pre emption under section 26 F of the Bengal Tenancy Act, 1885 on the ground that he was a co sharer of the holding which comprised the land purchased by the respondent.
The holding was previously a Raiyati Mokarari interest which had vested in the State under the provisions of the West Bengal Estates Acquisition Act, 1953.
the defence of the respondent was that, though the predecessor in interest of the appel lant and her vendor were the joint holders of the property in question, the right of pre emption available to the co sharer had ceased with the coming into force of the Estates Acquisition Act of 1953.
The pre emption application was allowed by the learned Munsif and his order was confirmed by the learned Additional District Judge.
In revision, the Full Bench of the High Court negatived the contention of the applicant and dis missed the pre emption application.
Dismissing the appeals and SLPs, this Court, HELD: (1) The Full Bench has rightly come to the conclu sion that the right of pre emption could not survive under the West Bengal Estates Acquisition Act, 1953.
[348B] (2) Section 26 F of the Tenancy Act, 1885 conferred on a cosharer tenant of an occupancy holding, a right to compel another co 528 sharer tenant to sell his share 'in the holding to him instead of to a stranger.
The term "co sharer" envisages that the holding must be under the ownership of more than one person.
The holding must be an occupancy holding: that is, it must be the holding of raiyats having occupancy rights.
So long as a division of the holding does not take place in accordance with section 88 of the Tenancy Act, the holding remains a joint holding and each co sharer will be entitled to preemption in case of transfer of a share or portion of the holding by a co sharer to a stranger.
[340E F] (3) By virtue of the notifications issued by the State Government under section 4 of the 1953 Act from time to time the interests of raiyats and under raiyats vested in the State with effect from April 14, 1956.
[341C] (4) The effect of 1953 Act was to vest the rights of intermediaries (an expression subsequently extended to cover raiyats and under raiyats) in the State Government.
Each raiyat became a direct tenant under the State and the land retained by a raiyat of a holding became the subject matter of a separate tenancy.
It was, therefore, no longer possible to call them co sharers entitled to pre emption case of a transfer to a stranger.
[341D; 345E] (5) By a notification dated 28.5.
1954, the Government of West Bengal framed rules called the West Bengal Estates Acquisition Rules, 1954.
The original rule 4 merely provided that in the case of agricultural land retained by the inter mediary, he shall hold it on the same terms and conditions as an occupancy raiyat under the Tenancy Act, leaving it undefined as to whether these terms and conditions would also include the right of pre emption available under the Tenancy Act.
The amendment of 1962 specifically included the right of pre emption available under section 26 F but the reference to section 26 F was omitted by the amendment of 1964.
This definition, however, did not mean that the right of pre emption was taken away.
[343F; 344E F; 347F] (6) There is no statutory provision that brings non agricultural tenants within the scope of the vesting provi sions.
The High Court was right in making the distinction and upholding the right of pre emption in the case of non agricultural tenancies.
[349A B] Shibasankar vs Prabartak Sanghs, Sastidas Mullick vs J.L.R.O. Parrachpore Circle and Ors., , referred to.
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<s>[INST] Summarize the judgementCivil Appeal No. 87 of 1959.
Appeal from the judgment and decree dated April 6, 1955, of the former Andhra High Court in A.S.O. No. 134/50.
T. V. R. Tatachari, for the appellants.
Bhimasankaram, K. R. Choudhuri and T. M. Sen, for the respondent.
December 21.
The Judgment of the Court was delivered by: RAGHUBAR DAYAL, J.
This is an appeal on a certificate granted by the High Court of Andhra Pradesh, against the judgment and order of the High Court reversing the judgment and order of the District Judge, Vizagapatam, holding that the place of worship in suit was not a temple as defined in the Madras Hindu Religious Endowments Act, 1926 (Madras Act II of 1927), hereinafter called the Act.
On March 28, 1947, the Board of Commissioners for Hindu Religious & Charitable Endowments, Madras, held the institution in suit to be a temple as defined in the Act.
The appellants, thereafter filed a petition under section 84(2) of the Act, in the Court of the District Judge, Vizagapatam, and prayed for the setting aside of the order of the Board.
They alleged that the institution, known as the Poohari Fakir Sadavarthy, at Bondilipuram, Chicacole, a ongstanding institution, was started by one Malukdas 278 Bavajee, some time during the reign of the Moghul Emperor, Aurangazeb.
The Emperor, in recognition of the Bavajee 's piety and devotion to God, made certain grants to him with the object and purpose of enabling him to maintain himself and carry on the distribution of Sadavarthy to Fakirs and Sadhus and to pray to God for the prosperity of the Empire and Emperor, according to what was stated in the well known historical works like Bhakthamala by Maharaja Raghunandha Singh Deo of Rewa.
The institution flourished and continues up to this day.
The original plaintiff No. 2, Rajaram Das Bavajee, was the ninth in succession from the founder Malukdas Bavajee.
He died during the pendency of the proceedings and is now represented by appellant No. 2, Mahant Gangaram Das Bavajee.
Sithaldas Bavajee, the sixth head of the institution, who lived in the first half of the Nineteenth Century built a temple and installed therein certain idols for his private worship.
The shrine was an adjunct of the institution Poohari Fakir Sadavarthy.
It is alleged to be a private temple known as Jagannadhaswami temple, Balaga, and is meant for the worship of the Mahant and his disciples, one of whom conducts the daily worship.
The income from the various properties granted to Malukdas Bavajee or his successors had been regularly utilised for the maintenance of the head of the institution and for distributing charities to the sadhus and pilgrims passing through Balaga.
A part of the income was, however spent on the expenses of the worship in the temple and the incidental expenses connected with it.
The respondent Board denied that Jagannadhaswami temple was a private place of worship, that the public had no access to it without the permission of the Bavajee and alleged that the temple possessed all the features of a place of public 279 religious worship and was dedicated to or for the benefit of or used as of right by the Hindu community as a place of religious worship.
The appellants examined five witnesses, including plaintiff No. 2, in support of their case.
The respondent examined one witness.
The plaintiffs also filed a number of documents.
The respondent filed a few documents which included the Board 's order dated March 28, 1947, and its enclosure.
The learned District Judge concluded, from the evidence, that Jagannadhaswami temple was not a temple as defined in the Act, it being a private temple existing for the benefit of the appellants only.
He therefore set aside the impugned order of the Board.
On appeal, the High Court came to a different conclusion and allowed the appeal.
It mainly relied on the entries in the Inam registers with respect to the institution and on the following facts which it considered to be established : (i) the temple is a very old temple constructed in or about the year 1750; (ii) the temple has the structure and polity of a public temple; (iii) there are utsava vigrahams and vahanams; (iv) it has a big compound wall with the gate opening into the Chinna Bazaar Road; (v) regular worship is performed every day at the scheduled time; (vi) there is an archaka who performs worship; (vii) a large number of pilgrims attend every day and partake in the food given after naivedyam to the God; 280 (viii) there are utsavams and the rathotsavam which is particularly conducted on large scale and is attended by members of the public.
The High Court relied on the statement of the solitary witness examined for the Board and rejected the statements of the witnesses examined for the appellants.
The sole question for determination in this appeal is whether this institution is a 'temple ' as defined in the Act.
Clause (12) of section 9 of the Act reads: " 'Temple ' means a place, by whatever designation known, used as a place of public religious worship and dedicated to, or for the benefit of, or used as of right by, the Hindu community, or any section thereof, as a place of religious worship.
" The institution in suit will be a temple if two conditions are satisfied.
One is that is a place of public religious worship and the other is that it is dedicated to or is for the benefit of, or is used as of right by, the Hindu community, or any section thereof, as a place of religious worship.
We are of opinion that the oral and documentary evidence fully establish the appellants ' case that it is not a temple as defined in the Act.
The documents on record and bearing dates from 1698 to 1803 A. D. mention the grants to be for the purposes of the Bavajee, i.e., the head of the institution.
The first document, Exhibit P 1, (is of the Hizri year 1117, corresponding to 1698 A.D., and purports to be executed by Ibrahim Khan, Bahadur, a humble servant of Badshah Alamgir Ghazi.
, i.e., Emperor Aurangazeb.
This order says: "The village of Cheedivalasa, Boonamali Pargana Haveli (town) towards Kaling of the 281 said Sirkar, has been fixed and continued as a complete inam in favour of Poohari (Poojari) Fakir Sadabarty in accordance with the Sanads of the previous rulers.
Meanwhile, in view of the claims of the said person it has been confirmed as per endorsement in accordance with momooli (usage) and mustamir (continuing, lasting long).
It is necessary that the said village be placed in the enjoyment of the said person so that, utilising the incomes thereof for his own maintenance, he may engage himself in praying for the stability of the State till eternity.
" The purpose of the other grants is stated in practically similar terms aud it is necessary to quote them.
None of the grants of land or other property on record bears a date subsequent to that of the year 1803 A.D.
The documents, Exhibits P 47, P 48 and P 49 are orders of the Collectors and refer to the villages of Cheedivalasa and Thallavalasa, and the last two state that the income of these two villages was given for sadavarty (feeding) for the respective year to Phalari (Phulhari) Bavaji.
There is no mention in any of these two documents that any grant was being made for the purposes of the temple or for the purposes of the Bavaji as well as for those of a temple.
The only reference to the construction of the temple is in Exhibit P 52, an extract from the Register of Inams dated May 22, 1865, with respect to village Vanzangi.
The name of the village, however, does not appear in the document itself.
It is stated in this document: "About century ago, the trustees built a temple of Jagannadhaswamy.
" According to this note, the temple may be said to have been built in about 1760 A.D.
The documents of the period from 1761 to 1803 A.D. Exhibits P 31 282 to P 49, do not record that the grants under them were for the expenses of the temple as well.
The grants simply mention them to be for the expenses of Fakirs, in the name of Poohari Fakir Sadavarthy, and not for the temple.
The non reference to the temple in the various documents is consistent with the temple being for the private worship of the head of the Sadavarti Institution and being an adjunct to that institution, as in that case there was to be no grant to the temple and the grant had to be to the Sadavarti institution or to its head.
It is also a matter for surprise that no independent grant to this temple was made subsequent to its coming into existence.
Some one religiously and charitably disposed could have thought of endowing some property to this public temple erected by the Head of a well known institution in that part of the country, where, it has been held judicially, there is a presumption of a temple being a public temple.
We may make it clear that among the documents referred to, we are not at the moment including entries in the Inam registers.
It follows from an examination of the various documents of the period between 1608 and 1803 A.D., that the various endowments were for the Fakir or Bavajee who ran the Sadavarti institution and that none of the grants was for the temple or even for the Sadavarti institution itself, it being always in the name of the Bavajee in charge of that institution.
Before discussing the entries in the inam registers which carry great weight, we may first refer to the Rules in pursuance of which the entries in the Inam registers were made, after due investigation.
The various extracts from the Inam registers which have been filed show that the proposals for the grant were confirmed under rule 3, clause (1), tax free.
This makes it of importance to consider the rule 283 thus referred to.
It is one of the rules for the adjudication and settlement of the inam lands of the Madras Presidency and is quoted at page 219 in the case reported as Arunachellam Chetty vs Venkatachalapathi Guruswamigal (1) "If the inam was given for religious or charitable objects, such as for the support of temples, mosques, colleges, choultries, and other public buildings or institutions, or for services therein, whether held in the names of the institutions or of the persons rendering the services; it will be continued to the present holders and their successors, and will not be subject to further interference, so long as the buildings or institutions are maintained in an efficient state, and the services continue to be performed according to the conditions of the grant.
" It was also said at page 217: "But the Inam Register for the year 1864 has been produced, and to it their Lordships attach importance.
It is true that the making of this Register was for the ultimate purpose of determining whether or not the lands were tax free.
But it must not be forgotten that the preparation of this Register was a great act of state, and its preparation and contents were the subject of much consideration under elaborately detailed reports and minutes.
It is to be remembered that the Inam Commissioners through their officials made inquiry on the spot, heard evidence and examined documents, and with regard to each individual property the Government was put in possession not only of the conclusion come to as to whether the land was tax free, but of a statement of the history and tenure of the property itself.
While their Lordships do not doubt that such a report would not displace actual 284 and authentic evidence in individual cases; yet the Board, when such is not available, cannot fail to attach the utmost importance, as part of the history of the property, to the information set forth in the Inam Register.
" Exhibit P 50 is the extract from the Inam Register No. 48 relating to village Tallavalasa in the Taluk of Chicacole in the district of Ganjam.
The note of the Deputy Collector, Inam Commissioner, records inter alia the following particulars: (1) The village was granted originally by the Nawab Mafuz Khan in Hiziri 1155 corresponding with A.D. 1739 to one Inamdar Bairagi; as the original sanad is not forthcoming it is impossible to mention here without entering into details, the object of the grant and the tenure of the village.
This mokhasa jahagiri is in possession of the person in column (II) who is known by the name of Palahara Mahant Bartudoss Bavaji, 'a Bairagi '.
(2) This Bartudoss Bavaji pleaded that this village and three other villages were granted in the district by the former Rulers for Sadavarti and for certain other Divine Service, and that the proceeds of them were appropriated to the expenses attendant on the temple of Sri Jagannadhaswami to some extent and to distributing Sadavarti or supplying victuals, fire wood, etc., or dressed food to Bairagis and others resorting to Rameswaram from Benaras and vice versa.
(3) This Bartudoss Bavaji produced a sanad of Sri Seetaram Ranzi Maharaja, the former zamindar of Vizianagaram in Vizagapatam district, granted to one Gopaladass Palahari Bavaji, dated Subhakrutu year, corresponding with A.D. 1782.
This Sanad 285 showed that the said Gopaladass was then a manager of the branch of charity and that this village was granted free from any tax in lieu of the income in the villages of Balaza, Petranivalasa and Serumohannadpuram which were granted originally by the authorities for the support of the charity and which were resumed and incorporated with circar lands.
The sanad explicitly stated that the proceeds of the village were to be appropriated for Sadavarti.
(4) On the whole it appears that this mokhasa was granted for 'Sadavarti ' and for the support of the temple of Sri Jagannadhaswami in Balaga.
There is a Bairagi Mattam in Balaga and a temple of Sri Jagannadhaswami.
This is therefore a charitable grant.
To keep up the object of grant, I think the village may be confirmed on its present tenure.
(5) Column 8, meant for noting the description of the inam, mentioned: 'Granted for the support for the Sadavarti Bairagi mattam in Balaga and of the temple of Sri Jagannadhaswami in the same village now efficiently kept up. ' (6) In column 10, under the heading 'hereditary, unconditional for life only or for two or yihre lives ' is mentioned 'hereditary '.
(7) Column 11 meant for recording the name of the grantor and the year of the grant, mentions, under it, Mafusu Khan Nawab, dated Hijiri 1155.
(8) In column 13, Mandasa Palahari Bairagi is mentioned as the original grantee.
(9) Under column 18, referring to relationship to original grantee or subsequent registered holders, is written 'Sadavarti 286 Bairagi mattam and the temple of Sri Jagannadhaswami in Balaga Trustee Palahara Mahant Barta Dasu Bavaji '.
It is clear from the fact that the grant was considered 'a charitable grant ' that the grant was not taken to be for the purposes of the temple, but was taken to be a grant for the purposes Sadavarti.
This is also clear from the Statement of Bartudoss Bavaji that it is only a part of the proceeds which is spent on the temple and not a major portion of the proceeds, as his statement is to the effect that the proceeds are appropriated to the expenses attendant on the temple 'to some extent '.
There is no suggestion that the temple was in existence in 1739 A. D. when the grant was made.
This makes it clear that no grant could have been made for the expenses of the temple and that a small portion of the proceeds was naturally spend on the temple by the Bavaji after the temple had been constructed.
Any statement in these entries about the grant being both for Sadavarti and for the expenses of the temple appears to be due to the wrong inference of the person making the enquiry.
He could easily commit such an error on account of the existence of a temple at the time of the enquiry and on account of the expression 'divine service '.
The 'divine service ' really meant, as would appear from the expression in the other documents of the period 1698 to 1802 A.D., service by way of prayers for the stability and continuity of the State '.
The expression that the grant was 'hereditary ' also supports the conclusion that the grant was to the Bavajee personally and not to the temple even if the temple existed at the time of the original grant.
In fact, the sanad granted by Seetaram Ranzi Maharaja and produced before the enquiry officers explicitly stated that the proceeds of the village were to be appropriated for Sadavarti.
287 This extract therefore supports the case of the appellants even though the name of the temple has been mentioned along with Sadavarti Bairagi.
The confirmation of the grant, tax free, was recommended by the Deputy Collector, Inam Commissioner, under Rule 3, Clause (1).
The order of the Officiating Inam Commissioner dated July 1864 is: 'Confirmed on present tenure ', and column 9 described the tenure as 'tax free '.
Exhibit P 51 is the extract from the Inam Register in the Zamindari estate of Tekkaly in the Chicacole Taluk, Ganjam District, and relates to the village Chinna Zavanapalli.
The report of the Deputy Collector shows that the claim of the then Bavajee was that the village was granted in the name of Gopaladass, trustee and priest of the mattam in Hijari 1165, corresponding to 1752 A.D.
It further records: "It is explained by the Zamindar 's shiristadar on behalf of the Zamindar that this was granted for the support of the mattam and this is not a personal grant.
This was entered in the permanent settlement account as an agrahar.
The object of the grant is to feed Bairagis and etc., who travel between Benaras and Rameswaram or supply victuals clothes and etc.
This branch of charity is known by the name of 'sadavarti '.
The proceeds of this village with the other villages, which granted for the support of the charity are appropriated to sadavarti and to worship the idols in the temple of the mattam.
As this is granted on the whole for the support of the charity branch, it should, I think, be confirmed on its present tenure.
" The entries under the various columns are practically on the lines of the entries in Exhibit P 50.
The entries in this register also support the case of the appellants to the extent that the original grant 288 in 1752 A. D., was to the then Bavajee and was for the purposes of the charity.
Exhibit P 52 is the extract from the Register of Inams with respect to village Vanzangi.
It records very clearly: "The object of this grant is to give 'sadavarti ' to travellers, that is, distributing alms and supplying victuals to travellers.
This grant was made during the reign of 'Alangir Padsha '.
Ever since the Inam is continued undisturbed.
About century ago, the trustees built a temple of Jagannadhaswamy.
Now in addition to distributing alms and giving Sadavarti to Bairagis and others, the idol in the temple is worshipped and annual festivals are made.
It appears that the Trustee is defraying charges to meet the object of the grant and that he is not mis appropriating the proceeds of the Inam in any way.
" The inam was confirmed as a charity grant to Mandasu Sadavarty Charity according to the terms of the grant.
This extract is of great importance as it, in clear terms, mentions that the object of the grant was to give sadavarti to travellers and that it was confirmed as a charity grant to this charity.
It speaks of the erection of the temple and still states that the Trustee was defraying the charges to meet the object of the grant.
This indicates that the expenses of the temple were taken to be incidental to the expenses of the entire sadavarti and that the temple was just an adjunct to the sadavarti institution.
Exhibit P 7, Parwana dated November 15, 1722, corresponding to 14th day of Rabial Awwal, 1135 Hijiri, refers to the grant of this village to Poohari Fakir Sadavarti.
Exhibit P 53 is the extract from the Register of Inams relating to village Ragolu in Chicacole 289 Taluk.
It records: 'In the sanad it was mentioned that the inam was given for the support of fakirs to the original grantee about a century ago.
The other notes in this extract are practically identical with those in Exhibit P 52.
The final order of the Inam Commissioner was also in terms similar, and was 'confirmed to the fakirs the sadavarti charity according to the grant, free, there being no excess.
It is interesting to note that in column 2 (general class to which inam belongs) is noted 'Dewadayam ', i.e., dedicated to God; that in column 8 meant for the description of the inam is noted: 'for the support of Pagoda of Sri Jagannadhaswami in Bondilipuram ', and that the entry in column 11 indicates that Anavaruddin Khan Bahadur made the grant in Hijiri 1171 corresponding to 1754 55 A. D.
It is clear that the note about the land being dedicated to God is wrong in view of the definite statement that the Sanad mentioned that the inam was given for the support of fakirs to the original grantee (Mandasa Palahari Bairagi in Column 13) about a century ago and that it was the trustees of the institution who constructed the temple.
When the temple was constructed by the trustees of the institution, viz., the Sadavarti institution, the original grant could not have been to the temple or to God.
The entries in this extract confirm the construction we have placed on similar entries in Exhibit P 52 and other extracts indicating the grant to the temple.
Exhibit P 54 is the extract from the Inam Register of No. 85 'Tallavalasa in the Taluk of Chicacole in the District of Ganjam.
It is mentioned in this that Pratapa Rudra Narayana Devu granted this village to Falar Gosayi for the support of the 'Bavajee ' or Swami, in Hiziri 1141 which would correspond to about 1747 A. D.
It is also noted in the report that the object of the grant was that the proceeds should be appropriated for divine purpose and that the proceeds were appropriated to the temple and sadavarti.
The note 'for the support 290 of the pagoda of Jagannadhaswami ' in column 8 meant for the description of the inam, again, appears to be an entry made under an erroneous impression.
There was no temple in existence when the grant was made in about 1747 A. D. Exhibit P 55 is an extract from the Register of Inams in the village of Balaga of Chicacole taluk dated August 13, 1881.
It mentions, under the heading 'by whom granted and in what year, "the grant was made by Rajah Narayana Gazapati raz Bahadur under orders of Alamgir Padsha on 14th May of Hiziri 1171 corresponding with English years 1754 55.
It is also noted: the Sanad granted is in existence. ' It is stated therein that as these lands appear from a former firman to have been granted to Sadavarti Mandass Bavaji for planting topes and raising buildings; they should be restored to him in pursuance of the long standing right.
This means that the firman, which was not forth coming during the inam enquiry, dated from very early time.
It must be noted again that this extract also describes the inam as Devadayam, i. e., dedicated to God.
Again, clearly, this entry is wrong in view of the sanad which was in existence clearly stating that the lands were granted under a firman to Sadavarti Mandass Bavaji for planting topes and raising buildings and also in view of what is recorded in Exhibit P 12, a parvana of 1742 A.D., under the seal of Nawab Jafer Ali Khan.
It records: "It has been proved that Mandas, the successor of Poohari (Poojari) Faqir Sadabarti has, per endorsement six kattis of land, free from assessment, in the village of Balaga and etc.
, villages of the said Haveli Sircar, fixed for the expenses of the coming and going Fakirs in accordance with the sanads of the previous rulers.
Therefore in consideration 291 of the blessings to follow, it has been confirmed as of yore.
" It was the result of this wrong view of the enquiry officer that the Inam Commissioner confirmed the grant free of quit rent so long as the service was kept up, presumably the service of the deity, as the distribution of charity would not be properly described as 'service. ' The fact that the Inam Commissioner treated the grant relating to Exhibit P 50 to be in support of Sadavarti and for support of the temple of Sri Jagannadhaswami, would not make the grant for the purposes of the temple when the temple was itself not in existence at the time the grant was made and when a later sanad referring to it definitely stated that the original villages were granted for the purposes of charity.
The observations of the Privy Council in Arunachellam 's Case (1) that in the absence of the original grant the Inam Register is of great evidentiary value, does not mean that the entry or entries in any particular column or columns be accepted at their face value without giving due consideration to other matters recorded in the entry itself.
We have already stated that the 'divine service ' referred to in this entry does not refer to any religious worship but to the prayers to be offered by the grantee for the preservation of the State.
We do not find anything on record to support the observations in the High Court judgment that the Bavajee, with the consent of the Ruler for the time being, constructed a temple and appropriated the income for carrying out the worship of the temple.
No document states that the temple was constructed by the Bavajee after obtaining the consent of the ruler for the time being.
Exhibits P 52 and P 55 just mentioned that the trustees built a temple of Sri Jagannadhaswami.
The 292 expression 'trustees ' refers to the trustees of the Sadavarti institution and not to the trustees of the temple as such.
There is nothing in these documents to support the view that the temple was built with the consent of the ruler for the time being.
The appellants examined five witnesses to support their case that the Hindu public have no right to offer worship in the temple which is a private temple.
The learned Judges described the statement of Janardhana Prasad Bhatt, P.W. 4, as worthless.
No particular reliance is placed on his statement by the appellants in this Court.
The appellants, however contend that the statements of the other witnesses have been rejected by the High Court for inadequate reasons.
The first witness is Iswara Satyanarayana Sarma, P.W. 1.
He was aged 63 at the time of his deposition in 1949.
He was a Sanskrit and Telugu Pandit in the Municipal High School and practised as an Ayurvedic Doctor.
He has given reasons for the view that the temple is not a public temple.
It is not necessary to refer to them.
His statement, has been rejected as he was considered to be interested in the Mahant who had been his patient and as the statement made by him that people including the sishyas, i.e., the disciples, take permission of the Mahant for worshipping, was considered artificial.
This witness did not state that even disciples had to take permission of the Mahant for worship and so the latter reason was based on an erroneous impression of his statement, The mere fact that the Mahant consults him for his ailments and the ailments of other sadhus is no ground for him to make false statements.
He is not under obligation to the Mahant.
It may be that the Mahant is under obligation to him.
The next witness is P. Kameswara Rao, P.W. 2.
He is aged about 30 years.
He was the 293 Additional Public Prosecutor of Vizagapatam, had been Municipal Councillor for a decade, President of the Co operative Central Bank and resided close to the temple.
He was in a very good position to know about the public worshipping at the temple as a matter of right.
He stated that he never found the public using the temple and that he himself might have visited the temple roughly about hundred times.
He was put a direct question in cross examination and gave a clear cut answer.
He denied from personal knowledge that the place was used as a place of public religious worship and that members of the public who were Hindus had a right of access to the temple for purposes of religious worship.
It may be mentioned that the question also referred to the temple being built as a place of public religious worship and the answer would include a denial of this fact.
It is obvious that the witness could not have known anything about it.
He seemed to have overlooked the significance of this part of the question.
We do not consider that his denying this fact on personal knowledge affects his veracity in any way, and especially, when he further stated that his personal knowledge consisted of three facts: (i) his attending the Rathayatra and seeing that no offerings of harati and dakshina were made; (ii) his not seeing any member of the public entering the temple whenever he entered into the temple; and (iii) whenever he entered the temple, he took the permission of the mahant.
The learned Judges rejected his testimony with this observation: "The evidence of this witness is more like an advocate supporting the case of mahant than that of a witness, who has come into the witness box to speak of facts.
The aforesaid facts based on his personal knowledge afford a very slender foundation for the conclusion which this witness has so boldly asserted in the witness box.
" 294 The expression 'the aforesaid facts ' had reference to the facts on which his personal knowledge was based.
These facts, in our opinion, afford good ground for the view expressed by him that the temple was not a public temple.
He visited the temple so many times, and never saw any member of the public visit it.
He himself took permission from the Mahant when he entered the temple.
Nothing could be better corroboration of his own statement than his own personal conduct in seeking permission from the Mahant.
We do not see any good reason for discrediting his testimony.
The next witness is G. Venkata Rao, P.W. 3, aged 48 years.
He is a chairman of the Municipal Council, Chicacole, Secretary & Vice President of the Co operative Central Bank.
His statement has been considered to be very artificial.
His statement that whenever he visited the temple he asked the permission of the Mahant is good corroboration of his statement that he considered the temple to be a private temple and not a public one.
The facts that the Mahant is also a Municipal Commissioner and consults him occasionally as a doctor, are no good grounds to discredit him.
The last witness the plaintiff No. 2, the predecessor of the appellant No. 2.
He is undoubtedly interested in the success of the proceedings started by him.
But that alone is no reason to ignore his statement altogether.
In fact, his statement should be accepted in view of the support it gets from the statements of the other three witnesses just referred to.
It is very significant, as pointed out by learned counsel for the appellants, that none from the Hindu public of the place has been examined for the respondent in support of its contention that the Hindu public go to this temple for worship as a matter of right.
Quite a good number of people 295 should have been available for the purpose if it was a fact.
The respondent, on the other hand, examined only M. Adinarayana Rao, who had been Inspector of Hindu Religious Endowments Board of the Chicacole division from 1946 to 1948.
He certainly states that the temple in suit is a public temple in which all people can go as a matter of right for worship.
It is a moot question as to how he can make such a statement even if he had seen a number of people entering the temple and worshipping there, which itself is not a fact.
When there be good evidence about the temple being a private one, the mere fact that a number of people worship at the temple is not sufficient to come to the conclusion that the temple must be a public temple to which those people go as a matter of right as it is not usual for the owner of the temple to disallow visitors to the temple, even if it be a private one.
He stated that there were several festivals like Nethroshasevam, the car festival and kalyanam.
In cross examination he had to admit that he had not visited the kalyan festival and did not know when it was celebrated.
This is sufficient to indicate that he is a zealous witness.
He stated that there was an archak, but he could not give the archak 's name.
Ordinarily, it need not have been expected of him to have known the archak 's name.
But, considering that he was an Inspector of the Board and had visited the temple officially also and had to submit a report, it is rather difficult to believe that if he had really found an archak, a priest other than the Mahant and his disciples, he would not have considered it essential for the purposes of his enquiry to know his name.
We see no reason to prefer his shaky statement to the statements of the witnesses examined for the appellants.
296 We need not consider the statements of the witnesses with respect to the features associated with the public temple and which are said to be absent in the temple in suit.
It is admitted by the respondent 's witness that there is a Tulsi plant before the shrine.
It is strenuously urged for the appellants that no public has a Tulsi Kotta, and this contention seems to find support from the statement made by the respondent 's witness in reexamination that generally, in Oriya temples no flag staffs are located and Tulsi plants are grown instead.
The description of the temple with respect to its construction, equipment, practices, observances and the forms of worship are not inconsistent with the inference from the other evidence that the temple is not a public temple.
The statement of the respondent 's witness that generally Oriya temples have no flag staffs and have Tulsi plants has significance in one other connection also.
It was said in Mundancheri Koman vs Achuthan Nair (1) at page 408 that in the greater part of the Madras Presidency, where private temples were practically unknown, the presumption is that temples and their endowments form public charitable trusts.
The presumption is certainly rebuttable.
The evidence in this case sufficiently rebuts it.
The temple is situate at a place which was practically at the boundary of the Madras Presidency, and close to the common boundary between that Presidency and Orissa.
The presumption with respect to the temple in the Madras Presidency, therefore, will be a very weak one with respect to the temple so situated.
We are therefore of opinion that the temple in suit is not a temple as defined in the Act as it is not used as of right by the Hindu community, or any section thereof, as a place of religious worship.
We therefore allow the appeal with costs throughout, set aside the order of the Court below and 297 restore the order of the District Judge, Vizagapatam, setting aside the order of the Board dated March 28, 1947.
Appeal allowed.
[/INST]The Emperor Aurangazeb made certain grants to one Mukuldas Babajee, founder of the institution Poohari Fakir Sadavarthy, for the purpose of his maintenance and to carry on the distribution of Sadavarthy to Fakirs etc.
The sixth head of the institution built a shrine for his private worship.
It was adjunct to the aforesaid institution, and the public had no access to it without the permission of Mahant.
The income from various properties granted to the founder and his disciples had been regularly utilised for the maintenance of the head of the institution and for distributing charities for the Sadhus and pilgrims; a part was spent on the expenses of the worship in the temple.
The Board of Commissioners for Hindu Religious and Charitable Endowments, Madras held that the temple in suit was a public temple.
The sole question for determination was whether this institution was a public temple as defined in the Act. ^ Held, that an institution would be a public temple within the Hindu Religious Endowments Act, 1926, if two conditions are satisfied; firstly, that it was a place of public religious worship and secondly, that it was dedicated to, or was for the benefit of, or was used as of right by the Hindu Community, or any section thereof, as a place of religious worship.
When there be good evidence about the temple being a private one, the mere fact that a number of people worship at the temple, is not sufficient to come to the conclusion to the temple must be a public temple to which those people as a matter of right as it is not usual for the owner of together temple to disallow visitors to the temple, even if it be private one.
In the present case the description of the temple with respect to its construction, equipment, practices, observances 277 and the form of worship are not inconsistent with the inference from the other evidence that the temple is not a public temple.
The temple is not a temple as defined in the Act and it is not used as of right by Hindu Community, or any section thereof, as a place of religious worship.
Held, further that the Inam Register is of great evidentiary value, but that does not mean that the entry or entries in any particular column or columns be accepted at their face value without giving due consideration to other matters recorded in the entry itself.
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<s>[INST] Summarize the judgementCivil Appeal No. 1365 of 1978 From the Judgment and Order dated 11.8.77 of the Patna High Court in Civil Revision No. 585 of 1976.
B.P. Singh R. Kumar and R. Prakash for the Appellants.
Mrs. Gian Sudha Misra for the Respondent.
The Judgment of the Court was delivered by DESAI, J.
Where a plaintiff in a suit bitterly complains that the defendant would be getting unfair advantage of his own lapse, if we were to interfere with the judgment rendered by the High Court, we put ourselves on caution whether such be the outcome of our setting aside the order under appeal.
Unwittingly, this Court should not be a party to the conferment of an undeserved advantage on a party to a proceeding guilty of a lapse though remediable and even unintentional.
Deeper probing into the facts reveals that the boot is on the other foot in that the respondent plaintiff is wholly to be blamed for the delay.
The facts first.
The respondent plaintiff field a suit for eviction against the appellant defendent on the only ground that the tenant committed default in payment of rent for the period May, 1969 to December, 1971.
The defendant contested the suit inter 829 alia contending that he was not in default.
There followed an application by the respondent landlord for a direction under Sec.
11A of the Bihar Buildings (Lease, Rent and Eviction) Control Act, 1947 ( 'Act ' for short).
Section 11A reads as under: "11A. Deposit of rent by tenants in suits for ejectment If in a suit for recovery of possession of any building the tenant contests the suit, as regards claim for ejectment the landlord may make an application at any stage of the suit for order on the tenant to deposit month by month rent at a rate at which it was last paid and also the arrears of rent, if any and the Court, after giving an opportunity to the par ties to be heard, may make an order for deposit of rent at such rate as may be determined month by month and the arrears of rent, if any and on failure of the tenant to deposit the arrears of rent within fifteen days of the date of the order or the rent at such rate for any month by the fifteenth day of the next following month, the Court shall order the defence against ejectment to be struck out and the tenent to be placed in the same position as if he had not defended the claim to ejectment.
The landlord may also apply for permission to withdraw the deposited rent without prejudice to his right to claim decree for ejectment and the Court may permit him to do so.
The Court may further order recovery of cost of suit and such other compensation as may be determined by it from the tenant.
" The prayer in the application was that the defendant tenant be directed to deposit the rent in arrears upto and inclusive of June 1973 within a period of fifteen days from the date of the order and a further direction be given that he should continue to deposit the rent from month to month.
The learned Judge made an order directing the appellant to deposit rent for the period upon and inclusive of June 1973 at the rate of Rs. 32 per month and there after to continue to deposit the rent from month to month at the rate of Rs. 12.20 per month.
The tenant preferred a revision petition which was dismissed on March 26, 1974.
The such was fixed fore haring on January 28, 1975.
The tenant moved an application for adjournment which was rejected.
Plaintiff 's witnesses were examined and the suit was decreed ex parte on January 30, 1975.
On an application moved by the defendant praying for relief under 830 Order IX Rule 13, Code of Civil Procedure the learned Judge set aside the ex parte decree and set down the suit for proceeding further from the stage where it was decreed ex parte.
On January 5, 1976, the respondent landlord moved an application praying that as there was irregularity in depositing the rent for the month of August to October, 1975, defence of the appellant be struck off, the his failure to strictly comply with the order made under Section 1 IA.
After the appellant filed his rejoinder, the learned Judge heard the application and rejected the same on the ground that as the earlier order was made prior to the date on which the suit was decreed exparate, on the setting aside of the exparte decree and revival of the suit, the order giving directions for deposit of future rent does not per se revive and therefore even if there was some default on the part of the tenant in depositing the rent for the months from February to April, 1979, his defence cannot be struck off.
Promptly, the respondent landlord moved a revision petition before the High Court being Civil Revision No. 585 of 1976.A Division Bench of the High Court heard and disposed of the revision petition on August 11, 1977.
The learned Judges of the High Court made the rule absolute and set aside the order of the learned trial Judge refusing to strike off the defence of the appellant and directed the learned Judge to note that the defence of the appellant will be deemed to have been struck off due to non compliance of the order dated April 26, 1973.
Hence this appeal by special leave which is being heard after seven years.
Section 11A, to some extent, can be styled as a check on the tendency of the defendent to protract the litigation by frivolous defences more especially where the duty to pay the rent is unmistakably admitted.
In a suit for eviction, Sec.
11A enables the court to give a direction to pay rent which is claimed to be in arrears as also to compell the defendent who continues to remain in possession during the pendency of the proceedings to perform his obligation to deposit the rent regularly.
It also enables the court to deter mine the rate of rent at which the deposit shall be made, wherein a case there is a dispute as to the rate of rent.
It is an undeniable feature of the tenancies in this country that more or less excluding the metropolitan areas, the tenancy is generally oral and no written record is usually available to furnish evidence as to the terms of lease.
Giving a receipt for the rent paid has not still become a part of the culture of a landlord.
Therefore where 831 eviction is sought on the ground of non payment of rent, it places a tenant at a comparative disadvantage if the landlord chooses to claim rent at the rate which is beyond the capacity of the tenant to pay.
In such a situation, the tenant will be exposed to double jeopardy in that on a prima facie pleading he will be directed to deposit the rent at the rate claimed by the landlord, if the court has no power to determine rate of rent at an interim stage.
Such power is conferred by Sec.
11A on the court.
The court can also determine as to from what date the tenant appears to be in arrears so that an appropriate direction can be given that the rent in arrears may be deposited within the time stipulated by the court as also future rent may be deposited regularly in the court.
It is a whole some provision which would advance justice.
Now where power is conferred on the court to give such directions, a sanction had to be created to guard against the failure to comply with the court 's directions.
This sanction is to be found in the conferment of power on the court to strike off the defence of the tenant if the tenant fails to comply with the order of the court giving directions for deposit.
Such a sanction would again advance justice.
So far there is no dispute.
The contention of the landlord which has found favour with the High Court is that the moment the failure of the tenant to comply with the earlier order is brought to the notice of the court, without anything more the defence has to be struck off.
This view of the court is founded on the use of the expression 'shall ' in that part of section by which power in conferred on the court to strike off the defence.
The relevant part of the expression reads thus: F ". on failure of the tenant to deposit the arrears of rent within fifteen days of the date of the order or the rent at such rate for any month by the fifteenth day of next following month, the court shall order the defence against ejectment to be struck off and the tenant be placed in the same position as if he had not defended the claim to ejectment.
" Interpreting this expression 'shall ' as mandatory in the afore mentioned clause, the High Court was of the opinion that as there was default in making the deposit for the month herein before mentioned 832 which would show non compliance with the order dated July 26, 1973 passed under Sec.
11A and therefore 'the tenant will have to bear consequences thereto ' The High Court further observed that 'once a default is found, the courts are powerless; the statutory consequences are bound to follow. ' In the back drop of the rival contentions, the neat question that arises is: whether the use of the word 'shall ' in the expression herein before extracted makes the provision imperative or mandatory or the court still retains the discretion to relieve against the default ? Ordinarily the use of the word 'shall ' prima facie indicates that the provision is imperative in character.
However, by a catena of decisions, it is well established that the court while considering whether the mere use of the word 'shall ' would make the provision imperative, it would ascertain the intenedment of the legislature and the consequences flowing from its own construction of the word 'shall '.
If the use of the word 'shall ' makes the provision imperative, the inevitable consequence that flows from it is that the court would be powerless to grant any relief even where the justice of the case so demands.
If the word 'shall ' is treated as mandatory the net effect would be that even where the default in complying with the direction given by the court is technical, fortuitous, unintended or on account of circumstances beyond the control of the defaulter, yet the court would not be able to grant any relief or assistance to such a person.
Once a default is found to be of a very technical nature in complying with the earlier order, the court must have power to relieve against a drastic consequence all the more so if it is satisfied that there was a formal or technical default in complying with its order.
To illustrate, if the tenant while he has on the way to the court on the 15th day to deposit the rent for the just preceeding month as directed by an order under Sec.
11A, met with an accident on the road and could not reach the court before the court hours were over, should he be penalised by his defence being struck off.
Even if the court is satisfied that he was on the way to the court to make the necessary deposit, that he had the requisite amount with him, and that he started in time to reach the court within the prescribed court hours and yet by circumstances beyond his control, he met with an accident would the court be powerless to grant him relief? This illustration would suffice to 833 the intendment of the legislature that it never used the word 'shall ' to make it so imperative as to render the court powerless.
The statute in which the expression is used is The Bihar Buildings (Lease, Rent and Eviction) Control Act, 1947.
It is a statute enacted with a view to providing a fetter on the right of a landlord to evict tenant at his whim or fancy.
The long title of the Act shows that it was enacted to regulate the letting of buildings 13 and the rent for such buildings and to prevent unreason able eviction of tenants therefrom in the Province of Bihar.
A provision in such a statute primarily enacted for the protection of tenants against unreasonable eviction that the court is required to find out whether the word 'shall ' was used as to make the provision mandatory or imperative.
Obviously if one ascertains the intendment of the legislature, the purpose for which the provision was enacted, the beneficient nature of the statute and to protect the harassed tenant obviously it does not require long argument to hold that the expression 'shall ' was used not with a view to making the provision mandatory or imperative but it was to be directory.
Such a construction would advance the purpose for which the Act was enacted namely the protection of tenants.
It will also not render the court powerless in the face of harsh facts where striking off the defence would be nothing short of miscarriage of justice.
Mrs. Gyan Sudha Misra, learned counsel however contended that where the expression 'may ' and 'shall ' both are used in the same provision the legislative intendment is unmistakable that the provision where the word 'shall ' is used must be held to be mandatory because the previous use of the expression 'may ' shows that the legislature was conscious, which part of the provision is to be directly and which other part to be mandatory.
She relied upon a statement in Maxwell on the Interpretation of Satutes 12th Edn.
Page 282 where in it is stated relying upon the decision is R. vs Inhabitants of Great Bolton(1) that "where the Legislature in the same sentence uses different words, we must presume that they were used in order to express different ideas.
" Obviously where the legislature uses two words 'may ' and 'shall ' in two different parts of the same provision prima facie it would appear that the legislature manifested its intention to make one part directory and another (1) at 74 834 mandatory.
But that by itself is not decisive.
The power of the court still to ascertain the real intention of the Legislature by care fully examining the scope of the statute to find out whether the provision is directory or mandatory remains unimpaired even where both the words are used in the same provision.
In Govindlal Chagganlal Patel vs The Agricultural Produce Market Committee Godhra and others(1) Chandrachud, J. speaking for the Court approved the following passage in Crawford on 'Statutory Construction ' (Ed. 1940 article 261, p. 516): "The question as to whether a statute is mandatory or directory depends upon the intent of the legislature and not upon the language in which the intent is clothed.
The meaning and intention of the legislature must govern and these are to be ascertained, not only from the phrasacology of the provision, but also while considering its nature, its design and the consequences which would follow from construing it the one way or the other.
" Applying this well recognised canon of construction the conclusion is in escapable that the word 'shall ' used in the provision is directory and not mandatory and must be read as 'may '.
This construction also commends to us for the additional reason that where the court fixes a time to do a thing, the court always retains the power to extend the time for doing so.
148 of the Code of Civil Procedure provides that where any period is filed or granted by the court for the doing of any act prescribed or allowed by the Code, the Court may, in its discretion, from time to time, enlarge such period, even though the period originally fixed or granted may have expired.
The principle of this section must govern in not whittling down the discretion conferred on the court.
The view which we are taking is in accord with the construction put by this court on a provision imparimateria in a similar statute.
In Shyamcharan Sharma vs Dharamdas(2) a question that arose (1) ; (2) ; 835 before this Court was whether the construction put by the High Court on Sec. 13 (1) read with Sec. 13 (6) of the Madhya Pradesh Accommodation Control Act, 1961 accords with the intendment of the Legislature.
The relevant provision provides that on an application, a tenant can be directed by the Court to pay to the landlord an amount calculated at the rate of the rent at which it was paid for the period for which a tenant may have made a default including the period subsequent thereto upto the end of the month previous to that in which the deposit or payment is made and shall thereafter continue to deposit or pay month by month by the of tenth of each succeeding month, the sum equivalent to the rent.
It was contended that the provision i i mandatory so that the court has to power to extend the time initially liked by it for making the deposit.
A submission before the court was that the expression used in sub sec.
(1) discloses the legislative intent and the use of the word 'may ' in sub sec.
(6) would not make the provision directory.
The Court, speaking through O. Chinnappa Reddy, J. after ascertaining the intendment of the Legislature held that the court has the jurisdiction to extend time once fixed for deposit or payment of monthly rent falling due after the filing of the suit.
Failure to comply with an earlier direction should not necessarily visit the tenant with the consequence of his defence being struck off because there might be myriad situations in which default may be committed.
The Court should adopt such a construction as would not render the court powerless in a situation in which ends of justice demand relief being granted.
The High Court has adopted such a construction which would defeat the beneficent nature of provision.
The decision of the High Court will have to be set l, aside because it proceeds on the basis that once there is default, the tenant must suffer the consequences of it.
The learned trial Judge had held that once a suit ended in exparte decree the earlier direction for making necessary deposit given under Sec.
it would remain ineffective even if the exparte is, decree is set aside and would not revive was rightly disapproved by the High Court.
To that extent the view of the learned trial Judge was unsustainable.
The learned trial Judge did grant relief to the tenant by refusing to strike off the defence, of course, on an erroneous view 836 of law that the direction did not revive after the setting aside of the ex parte decree.
And the High Court reversed it on another crroneous view of law that the court was powerless to grant any relief once a default is established ? The question then is what relief we should grant ? The tenant has deposited all the arrears.
There was some irregularity in making the deposit but it was not of such a nature as to visit the tenant with the consequence of striking off his defence.
Therefore the Judgment of the High Court directing that the defence be deemed to be struck off is set aside and the order of the learned trial Judge is restored for the reasons herein stated.
This appeal is allowed accordingly and the matter is remitted to the trial court to proceed further with the suit from the stage where the defence of the present appellant was struck off.
The defence will be treated as part of the proceedings and suit shall be proceeded with accordingly.
As the matter is delayed for long, we direct that the suit shall be accorded priority by the trial court and shall be disposed of within a period of six months from the date of this judgment.
Mrs. Misra on behalf of the respondent submitted that the respondent has filed a second suit for eviction on the ground of personal requirement.
If that is pending the same must be heard alongwith the suit from which the present appeal arises.
We leave the parties to bear their respective costs both in the High Court as well as in this Court.
Costs in the trial court will abide the outcome of the suit.
[/INST]The respondent plaintiff filed a suit for eviction against the appellant defendant on the ground that the tenant committed default in payment of rent.
The defendant contested the suit contending that he was not in default.
An application was filed by the respondent landlord for a direction under Sec.
11A of the (Bihar Buildings Lease, Rent and Eviction) Control Act, 1947 to the defendant tenant to deposit the rent in arrears; and a further direction to deposit the future rent from month to month.
The trial judge ordered the appellant to deposit the rent in arrears at the rate of Rs. 32 per month and thereafter to continue to deposit the rent at the rate of Rs. 12 20 per month.
The defendant preferred a revision petition which was dismissed.
The suit was fixed for hearing.
The tenant moved an application for adjournment which was rejected.
the plaintiff witnesses were examined and the suit was decreed ex parte.
On an application moved by the defendant praying for relief under 826 Order IX Rule 13 CPC, the trial judge set aside the ex parte decree and set down the suit for proceeding further from the stage it was decreed ex parte.
The respondent landlord moved an application contending that as there was irregularity and delay in depositing the rent, the defence of the appellant be struck off for his failure to strictly comply with the order made under Section 11A, but the trial judge rejected it on the ground that the earlier order was made prior to the date on which the suit was decreed ex parte; on the setting aside of the ex parte decree and revival of the suit, the order giving directions for deposit of future rent does not per se revive and therefore even if there was some default on the part of the tenant in depositing the rent, his defence cannot be struck off.
The respondent landlord moved a revision petition before the High Court.
A Division Bench interpreted the expression 'shall ' in Sec.
11A of the Act, as mandatory, and finding that there was default in making the deposit for the months mentioned in the landlords ' application, it could be shown that there was non compliance with the order passed under Sec.
11A, and therefore 'the tenant will have to bear the consequence thereto. ' It further held that 'once a default is found, the courts are powerless; the statutory consequences are bound to follow, ' It made the rule absolute and set aside the order of the trial judge refusing to strike off the defence of the appellant and directed the trial judge to note that the defence of the appellant would be deemed to have been struck off due to non compliance of the order Passed under Section 11A.
Allowing the Appeal to this Court, ^ HELD: 1.
(i) Failure to comply with an earlier direction should not necessarily visit the tenant with the consequence of his defence being struck off because there might be myriad situations in which default may be committed.
The Court should adopt such a construction as would not render the court powerless in a situation in which ends of justice demand relief being granted.
[835 F F] In the instant case, the High Court had adopted a construction of Section 11A of the Act which would defeat the beneficient nature of the pro vision.
The decision of the High Court is set aside because it proceeds on the basis that once there is default, the tenant must suffer the consequences of it.
The trial judge held that once a suit ended in an ex parte decree the earlier direction for making necessary deposit given under Sec.
11A would remain ineffective even if the ex parte degree is set aside and would not revive, was rightly disapproved by the High Court.
The trial judge did grant relief to the tenant by refusing to strike off the defence, but on an erroneous view of the law.
The High Court reversed it on yet another erroneous view of law holding that the court was powerless to grant any relief once a default is established.
[835 F H; 836 A B].
827 (ii) The tenant has deposited all the arrears.
There was some irregularity in making the deposit but it was not of such a nature as to visit the tenant with the consequence of striking off his defence.
The judgment of the High Court directing that the defence be deemed to be struck off is set aside and the order of the trial judge is restored.
[836 C] 2 (i) Section I IA, can he styled as a check on the tendency of the defendant to protract the litigation by frivolous defences more especially where the duty to pay the rent is unmistakably admitted.
[830 F] (ii) In a suit for eviction, Sec.
11A enables the court to give a direction to pay rent which is claimed to be in arrears as also to compel, the defendant who continues to remain in possession during the pendency of the proceedings to perform his obligation to deposit the rent regularly.
It also enables the court to determine the rate of rent at which the deposit shall be made, where in a case there is a dispute as to the rate of rent.
[830 G] (iii) An undeniable feature of the tenancies in this country is that, the tenancy is generally oral and no written record is usually available to furnish evidence as to the terms of lease.
Giving a receipt for the rent paid has not still become a part of the culture of a landlord.
Therefore, where eviction is sought on the ground of non payment of rent, it places a tenant at a comparative disadvantage if the landlord chooses to claim rent at the rate which is beyond the capacity of the tenant to pay.
In such a situation, the tenant will be exposed to double jeopardy in that on a prima face pleading he will be directed to deposit the rent at the rate claimed by the landlord, if the court has no power to determine rate at an interim stage.
Such power is conferred by Section 11A on the Court.
It is whole some provision which would advance justice.
[830 H; 83 1 A C] 3.
Where the legislature uses the two words may and shall in two different parts of the same provision prima facie it would appear that the Legislature manifested its intention to make one part directory and another mandatory.
But that by itself is not decisive.
The power of the court still to ascertain the real intention of the Legislature by carefully examining the scope of the statute to find out whether the provision is directory or mandatory remains un impaired even where both the words are used in the same provision, [833 H; 834 A] In the instant case, if one ascertains the intendment of the legislature, the purpose for which the provision was enacted, the beneficent nature of the statute to protect the harassed tenant, it does not require long argument to hold that the expression 'shill ' was used not with a view to making the provision mandatory or imperative but it to was be directory.
Such a construction would advance the purpose for which the Act was enacted namely the protection of tenants.
It will also not render the court powerless in the face of harsh facts where striking off the defence would be nothing short of miscarriage of justice.
[833 D E] 828 R.V Inhabitants of Great Bolton, (1828) 8B & 71 at 74 Govindlal Chaganlal Patel vs The Agricultural Produce Market Committee, Godhra and others, [1976]1 SCR 451, referred to.
Where the court fixes a time to do thing, the court always retains the power to extend the time for doing so.
148 of the Code of Civil procedure provides that where any period is fixed or granted by the court for the doing of any act prescribed or allowed by the Code, the Court may, in its discretion, from time to time, enlarge such period, even though the period originally fixed or granted may have expired.
The principle this section must govern in not whittling down the discretion conferred on the court, by Section 11A of the Act.
[834 F G] Shyamcharan Sharma v Dharamdas, ; , referred to.
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<s>[INST] Summarize the judgementtition Criminal No. 1892 of 1981.
Under Article 32 of the Constitution of India Ram Jethmalani, Vineet Kumar, M. G. Karmali and Naresh K Sharma for the Petitioner.
The Judgment of the Court was delivered by BHAGWATI J.
: This is a petition for a writ of Habeas Corpus for securing the release of one Hasnain Mukhtar Hussain Lakdawala (hereinafter referred to as the detenu) who has been detained by the Government of Maharashtra under an order of detention dated 31st December 1980 made in exercise of the powers conferred under section 3(1) of the (hereinafter referred to as the COFEPOSA.
This order of detention though dated 31st December 1980 was served on the detenu on 17th January 1981 and alongwith the order of detention, a communication, also dated 31st December 1980, was served on the detenu containing the grounds of detention.
The Government of Maharashtra also served on the detenu at the same time a letter dated 7th January 1981 enclosing copies of the documents relied upon in the grounds of detention.
It appears that on 6th February 1981 the advocate of the detenu addressed a letter to the Superintendent, Bombay Central Prison where the detenu was then confined and alongwith this letter he forwarded nine copies of the representation which was to be submitted by the detenu to the Government of Maharashtra against the order of detention.
This letter was delivered by the authorities in charge of the Bombay Central Prison to the detenu on 6th February 1981, but on the same day the detenu was shifted from the Bombay Central Prison to Nasik 291 Road Central Prison and the nine copies of the representation were therefore carried by the detenu with him to the Nasik Road Central Prison and from there, the requisite number of copies of the representation duly signed by the detenu were forwarded to the Government of Maharashtra and the Chairman of the Advisory Board on 10th February 1981.
This representation was however rejected by the Government of Maharashtra by its letter dated 25th February 1981.
It appears that a copy of the representation was also sent by the detenu to the Central Government and by its letter dated 26th February 1981 the Central Government too rejected the representation.
In the meantime, the case of the detenu was referred to the Advisory Board and on 11th March 1981, the detenu was called for an oral hearing by the Advisory Board and at this meeting the detenu handed over to the Chairman and Members of the Advisory Board four copies of a further representation dated 11th March 1981 addressed by him jointly to the Chairman and the Members of the Advisory Board and the Government of Maharashtra praying that the Government of Maharashtra may be pleased to revoke the order of detention and set the detenu at liberty.
The Advisory Board considered the case of the detenu and by a letter dated 16th March 1981, the Secretary of the Advisory Board intimated to the advocate of the detenu that the Advisory Board had by its report dated 12th March 1981 advised the Government of Maharashtra that there was sufficient cause for the detention of the detenu.
The State Government thereafter in exercise of the powers conferred under clause (f) of section 8 passed an order dated 23rd March 1981 reciting the opinion given by the Advisory Board and confirming the order of the detention.
The petitioner who is the wife of the detenu thereupon preferred the present writ petition challenging the order of detention made by the Government of Maharashtra as also the continuance of the detention under the subsequent order dated 23rd March 1981.
There were several grounds urged on behalf of the petitioner in support of the petition and each one of them was seriously pressed before us by Mr. Jethmalani on behalf of the petitioner.
The first ground was that the order of detention was made by one P. V. Nayak, Secretary to Government, Revenue and Forest Department and Ex officio Secretary to Government, Home Department while the representation made by the detenu against the order of detention was considered and disposed of by the Minister of State for Home Affairs not by P. V. Nayak and hence there was no effective consideration of the representation of the detenu as required by law.
The argument on behalf of the detenu was that the representation of a 292 detenu must be considered by the same person who has passed the order of detention and since in the present case, the representation was considered by a different person, it was not a valid and proper consideration of the representation and the continuance of the detention of the detenu was therefore invalid There was also another related ground urged on behalf of the petitioner and it was that the Minister of State for Home affairs who considered the representation of the detenu was not competent to do so, both by reason of lack of authority as also in view of the fact that the case had already been dealt with by P. V. Nayak.
We do not think there is any substance in either of these two grounds.
If we look at the order of the detention, it is clear that it was not made by P. V. Nayak in his indi vidual capacity as an officer of the State Government but it was made by him as representing the State Government.
It was the State Government which made the order of detention acting through the instrumentality of P. V. Nayak, Secretary to Government who was authorised so to act for and on behalf of and in the name of the State Government under the Rules of Business.
Rule 15 of the Rules of Business of the Government of Maharashtra provided that those Rules may "to such extent as necessary be supplemented by instructions to be issued by the Governor on the advice of the Chief Minister" and in exercise of the power conferred under this Rule, the Governor of Maharashtra issued Instructions for the more convenient transaction of the business of the Government.
Clauses (4), (5) and (6) of these Instructions as they stood at the material time provided inter alia as under: 4.
Except as otherwise provided in these Instructions, cases shall ordinarily be disposed of by, or under the authority, of the Minister in charge, who may by means of standing orders give such directions as he thinks fit for the disposal of cases in the Department, Copies of such standing orders shall be sent to the Governor and the Chief Minister.
5 Each Minister shall arrange with the Secretary of the Department what matters or classes of matters are to be brought to his personal notice.
Except as otherwise provided in these instructions, cases shall be submitted by the Secretary in the Department to which the case belongs to the Minister in charge.
293 Pursuant to the instructions contained in these clauses, Shri A. R. Antulay, Chief Minister of Maharashtra and Minister incharge of the Home Department, issued a Standing order dated 18th July 1980 directing that cases under sub section (I) of section 3 of the COFEPOSA Act need not be submitted to him or to the Minister of State for the Home Department and that such cases may be allotted to and disposed of by any of the six officers mentioned there one of them being P. V. Nayak.
On the same day, another Standing order was issued by Sh.
A. R. Antulay Chief Minister of Maharashtra and Minister in charge of Home Department in pursuance of the provisions contained in Rule 6 of the Rules of Business, directing inter alia that all cases appertaining to the COFEPOSA Act and all other matters arising under the provisions of that Act may be allotted to the Minister of State for Home Affairs.
This latter Standing order provided that nothing contained in it shall affect the directions contained in the earlier Standing order issued on the same day.
It will therefore be seen that P. V. Nayak was authorised under the earlier Standing order dated 18th July 1980 to deal with and dispose of cases under sub section (I) of section 3 of the COFEPOSA and it was in exercise of the authority thus conferred upon him that P. V. Nayak acting for the State Government made the order of detention against the assessee under sub section (I) of section 3.
[t was the State Government which made the order of detention and not P. V. Nayak in his individual capacity.
The representation made by the detenu against the order of detention was also therefore required to be considered by the State Government and either it could be disposed of by P. V. Nayak acting for the State Government under the earlier Standing order dated 18th July 1980 or the Minister of State for Home could dispose it of under the later Standing order dated 18th July 1980.
Whether P. V. Nayak considered the representation and disposed it of or the Minister of State for Home did so would be immaterial, since both had authority to act for the State Government and wherever be the instrumentality, whether P. V. Nayak or the Minister of State for Home, it would be the State Government which would be considering and dealing with the representation.
The only requirement of Article 22 (5) is that the representation of the detenu must be considered by the detaining authority which in the present case is the State Government and this requirement was clearly satisfied because when the Minister of State for Home considered the representation and rejected it, he was acting for the State Government and the consideration and rejection of the representation was by the State Government.
There is no requirement express or implied in any provision of the COFEPOSA that the same person who acts for 294 the State Government in making the order of detention must also consider the representation of the detenu.
In fact, as pointed out by Chinnappa Reddy, J. in Smt.
Kavita vs State of Maharashtra(l) a Government business can never get through if the same individual has to act for the Government in every case or proceeding or transaction, however advantageous it may be to do so.
" Moreover it would really be to the advantage of the detenu if his representation is not considered by the same individual but fresh mind is brought to bear upon it.
We do not therefore see any constitutional or legal infirmity in the representation having been considered by the Minister of State for Home.
The next contention of Mr. Jethmalani on behalf of the petitioner was that there was nothing to show that the decision to confirm the order of detention and continue the detention of the detenu was taken by the State Government as required by clause (f) of section 8 and hence the continuance of the detention was invalid.
lt is really difficult to appreciate this contention urged on behalf of the petitioner.
It is clear from the annexures to the writ petition that after receipt of the opinion of the Advisory Board that there was in its opinion sufficient cause for the detention of the detenu, the State Government in exercise of the powers conferred under clause (f) of section 8, made an order dated 23rd March 1981 confirming the detention order and continuing the detention of the detenu.
This order was expressed to be made "By order and in the name of the Governor of Maharashtra" and was authenticated by the Under Secretary to the Government of Maharashtra Home Department.
It recited in so many terms that it was the State Government which was confirming the order of detention and continuing the detention of the detenu and no material has been placed before us on behalf of the detenu to displace the correctness of this recital.
There can therefore be no doubt that the ord r confirming the detention of the detenu was made by the State Government.
Moreover, we have the statement on oath made by C. V. Karnik, Assistant Secretary to the Government of Maharashtra, Home Department that "the Government of Maharashtra thereafter under clause (f) of section 8 of the said Act confirmed the said detention order by an order dated 23rd March 1981.
" lt was then contended by Mr. Jethmalani on behalf of the petitioner that under clause (b) of section 8 it as the obligation of 295 the State Government to make a reference to the Advisory Board A within five weeks from the date of detention of the detenu and there was nothing to show that the State Government had made such a reference to the Advisory Board.
This contention is also without substance and totally futile, because it is clear from the statement of C. V. Karnik in his affidavit that it was the State Government which referred the case of the detenu to the Advisory Board under clause (b) of section 8 and no material has been placed before us on behalf of the detenu controverting the correctness of this statement.
Mr. Jethmalani also raised another contention in this connection and it was that, before making a reference to the Advisory Board, the State Government had not applied its mind to the question whether it was necessary to detain the detenu for a period longer than three months and this non application of mind vitiated the reference to the Advisory Board and the subsequent order of confirmation following upon it.
The argument of Mr. Jethmalani was that it was only if the State Government decided to detain a person for a period longer than three months that it was required to refer the case of such person to the Advisory Board and it was therefore necessary for the State Government in every case of detention to apply its mind and consider at least before making a reference to the Advisory Board whether the detention was to be continued for a period longer than three months.
We are of the view that this argument is not well founded and must be rejected.
It is clear that under clause (4) of Article 22 no law providing for preventive detention can authorise the detention of a person for a period longer than three months unless the Advisory Board has reported before the expiration of the period of three months that there is in its opinion sufficient cause for such detention.
This requirement of clause (4) of Article 22 is satisfied by the enactment of section 8 iq the COFEPOSA.
Section 8 clause (b) provides that in case of every detention the appropriate Government shall, within five weeks from the date of detention, make a reference to the Advisory Board and the Advisory Board is required to make a report as to whether or not there is sufficient cause for the detention of the detenu and submit the same to the appropriate Government within eleven weeks from the date of detention of the detenu.
The period of eleven weeks from the date of detention is prescribed for the submission of the report obviously because under clause (4) of Article 22 no detention can lawfully continue for a period longer than three months unless the Advisory Board has reported before the expiration of the period of three months that there is in its opinion sufficient cause for such detention.
But one thing is clear that this provision for reference to the Advisory Board is not confined to cases where 296 the detaining authority has already come to a decision that the detention shall be continued for a period longer than three months.
It applies equally where the detaining authority has not yet made up its mind as to how long the detention shall continue or even where the detention is to continue for a period of three months or less.
Whenever any order of detention is made, whether the detention is to continue for a period longer than three months or a period of three months or less or the detaining authority has not yet applied its mind and determined how long the detention shall be continued, the appropriate Government is bound within five weeks from the date of detention to make a reference to the Advisory Board and if it fails to do so, the continuance of the detention after the expiration of the period of five weeks would be rendered invalid.
The Advisory Board is, in every such case where a reference is made, required to submit its report within eleven weeks from the date of detention and if it reports that there is in its opinion no sufficient cause for detention the detaining authority is bound to release the detenu forthwith, even though a period of three months may not have expired since the date of detention.
This is a safeguard provided by the COFEPOSA Act, which is applicable in all cases of detention, whether the detention is to be continued beyond a period of three months or not and whether or not the detaining authority has applied its mind and determined, before making a reference to the Advisory Board, as to what shall be the period of detention.
We are clearly of the view that it is not at all necessary for the detaining authority to apply its mind and consider at the time of passing the order of detention or before making a reference to the Advisory Board, as to what shall be the period of detention and whether the detention is to be continued beyond a period of three months or not.
The only inhibition on the detaining authority is that it cannot lawfully continue the detention for a period longer than three months unless the Advisory Board has, before the expiration of the period of three months, reported that three is in its opinion sufficient cause for such detention.
We must therefore hold that the State Government did not commit any breach of its constitutional or legal obligation in making a reference to the Advisory Board without first determining the period for which the detenu was to be detained.
Mr. Jethmalani on behalf of the petitioner lastly submitted that there was unreasonable delay on the part of the State Government in considering the representation of the detenu and this delay was fatal to the validity of the continuance of the detention.
This contention is also without substance and must be rejected.
It is no 297 doubt true that the advocate of the detenu sent nine copies of the representation to the detenu on 6th February, 1981 and these nine copies came to be forwarded to various authorities only on 10th February, 1981 but the affidavit of B. B. Mulay, Jailer attached to the Bombay Central Prison, shows that these nine copies were handed over by B. B. Mulay to the detenu as soon as they were received by him from the emissary of the detenu 's advocate and the detenu got B these documents on the same day, namely 6th February, 1981.
B. B. Mulay asked the detenu to sign the representation and hand over the same for being forwarded to the State Government but the detenu stated that he would sign the representation only after going through it and he therefore carried the nine copies of the representation with him to the Nasik Central Jail where he was shifted in the evening of 6th February, 1981 and it was only on 10th February, 1981 that he signed all the nine copies of the representation and handed over the same to C. P. Gaekwad, Jailer, In charge of the Nasik Central Prison and according to the affidavit of C. P. Gaekwad, these nine copies of the representation duly signed by the detenu were forwarded to the respective authorities on the same day.
There was therefore no un reasonable delay on the part of the State authorities at this stage.
Proceeding further we find that the representation sent by the detenu was received in the Home Department of the State Government on 13th February, 1981 and on the same day, a letter was addressed by the Home Department to the Collector of Customs calling for his remarks in regard to the various allegations contained in the representation and para wise comments were received from the Customs Department on 21st February, 1981.
Now, it cannot be said that the Government acted unreasonably in forwarding the representation of the detenu to the Collector of Customs and waiting for the para wise comments of the Customs Authorities, since there were various allegations made in the representation which called for the comments of the Customs Department and without such comments, the State Government could not fairly and properly consider the representation of the detenu.
It may be noted that the communication from the Home Department dated 13th February, 1981 could not have reached the Collector of Customs until 16th February, 1981 because 14th and 15th February were Saturday and Sunday and therefore closed holidays.
The reply of the Customs Authorities which was received on 21st February 1981 must have been despatched on 20th February and therefore the Customs Authorities did not have more than four or five days within which to give their comments in regard to the various allegations contained in the repre 298 sentation of the detenu and this time taken by the Customs Authorities cannot be regarded as unreasonable.
We do not think that in these circumstances the State Government could be said to be guilty of any unreasonable delay so far as the period between 13th February and 21st February, 1981 is concerned.
There was also no unreasonable delay after 21st February, 1981.
The affidavit of C. V. Karnik shows that the representation of the detenu was immediately put up before the Minister of State for Home for consideration, in the light of the comments received from the Customs Authorities and the representation was considered and rejected by the Minister of State for Home on 23rd February, 1981 and necessary intimation to that effect was conveyed to the detenu by a letter dated 25th February 1981.
It is impossible to hold in these circumstances that there was any unreasonable delay on the part of the State Government in considering the representation of the detenu and this contention of Mr. Jethmalani must be rejected.
These were all the contentions urged on behalf of the petitioner and since there is no substance in them, the petition fails and is dismissed.
section R. Petition dismissed.
[/INST]One Hasnain Mukhtar Hussain Lakdawala was detained by the Government of Maharashtra by an order of detention dated 31st December, 1980 passed under section 3(1) of COFEPOSA, 1974.
The order of detention was served on the detenu on 17th January, 1981 along with a communication dated 31st December, 1980 and a letter dated 7th January, 1981 was also served enclosing copies of the documents relied upon in the grounds of detention.
A letter dated 6th February, 1981 along with nine copies of the representation to be made by the detenu sent by the detenu 's advocate to the Superintendent, Bombay Central Prison, though handed over to the detenu by the prison authorities on the same day was carried by the detenu to the Nasik Road Central Prison to which he was shifted on that day.
The requisite copies of the representation duly signed by the detenu were forwarded to the Government and the Chairman of the Advisory Board on 10th February, 1981.
The State Government, however, rejected the representation by its letter dated 25th February, 1981.
A copy of the representation sent to the Central Government was also rejected on 26th February 1981.
In the meantime, the case of the detenu was referred to the Advisory Board and on 11th March 1981, when the detenu was called for an oral hearing, the detenu handed over four copies of a further representation dated 11th March 1981, praying for revocation of the detention order.
The Advisory Board consi dered the case and by its report dated 12th March 1981 advised the State Government that there was sufficient cause for the detention of the detenu, and through its letter dated 16th March, 1981 apprised the detenu 's advocate of the position.
The State Government thereafter confirmed the order of detention.
Hence the writ petition by the detenu 's wife.
Dismissing the petition, the Court, ^ HELD: 1:1.
There was no constitutional or legal infirmity in the representation of the detenu having been considered by the Minister of State for Home.
[294 B] 1:2.
The only requirement of Article 22(5) of the Constitution is that the representation of detenu must be considered by the detaining authority which in 289 the present case was the State Government and this requirement was clearly satisfied, because when the Minister of State for Home considered the representation and rejected it, he was acting for the State Government and the consideration and rejection of the representation was by the State Government.
[293 G] 1:3.
There is no requirement express or implied in any provision of COFEPOSA that the same person who acts for the State Government in making the order of detention must also consider the representation of detenu.
More over, it would really be to the advantage of the detenu, if his representation is not considered by the same individual but fresh mind is brought to bear upon it.
[293 H 294 B] In view of the clear provisions of Rule IS of the Rules of Business of the Government of Maharashtra, clauses 4 to 6 of the Instructions issued by the Governor thereunder and the two standing orders dated 18th July 1980 it was immaterial, whether P.V. Nayak considered the representation and disposed it of, or the Minister of State for Home did so, since both had authority to act for the State Government and whatever be the instrumentality, it would be the State Government which would be considering and dealing with the representation [292 D H; 293 F] Smt.
Kavita vs State of Maharashtra, [1982] I S.C.R. 138, followed.
The State Government did not commit any breach of its constitutional or legal obligation in making a reference to the Advisory Board without first determining the period for which the detenu was to be detained.
[296 G] 2:2.
It is not at all necessary for the detaining authority to apply its mind and consider at the time of passing the order of detention or before making a reference to the Advisory Board, as to what shall be the period of detention and whether the detention is to be continued beyond a period of three months or not.
The only inhibition on the detaining authority is that it cannot lawfully continue the detention for a period longer than three months unless the Advisory Board has, before the expiration of the period of three months, reported that there is in its opinion sufficient cause for such detention.
[296 E F] 2:3.
The requirement of clause (4) of Article 22 of the Constitution is satisfied by the enactment of section 8(b) of the COFEPOSA.
This provision for reference to the Advisory Board is not confined to cases where the detaining authority has already come to a decision that the detention shall be continued for a period longer than three months.
It applies equally where the detaining authority has not yet made up its mind as to how long the detention shall continue or even where the detention is to continue for a period of three months or less.
Whenever any order of detention is made, whether the detention is to continue for a period longer than three months or a period of three months or less or the detaining authority has not yet applied its mind and determined how long the detention shall be continued, the appropriate Government is bound within five weeks from the date of detention to make a reference to the Advisory Board and if it fails to do so, the continuance of the detention after the expiration of the period of five weeks should be rendered invalid.
The Advisory Board is, in every such case where a reference is made, required to submit its report 290 within eleven weeks from the date of detention and if it reports that there is in its opinion no sufficient cause for detention, the detaining authority is bound to release the detenu forthwith, even though a period of three months may not have expired since the date of detention.
This is a safeguard provided by the COFEPOSA, which is applicable in all cases of detention, whether the detention is to be continued beyond a period of three months or not and whether or not the detaining authority has applied its mind and determined, before making a reference to the Advisory Board, as to what shall be the period of detention.
[295 F 296 E] 3.
The State Government, in the instant case, cannot be said to be guilty of any unreasonable delay, at any stage, in considering the representation of the detenu.
[297D, 299 B, D]
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<s>[INST] Summarize the judgementCivil Appeal No. 1086 of 1973.
Appeal by Special Leave from the Judgment and Order dated 8 12 1971 of the Kerala High Court in T.I.T. Reference No. 91/69.
section C. Manchanda and Miss A. Subhashini for the Appellants.
K. T. Harindranath and T. T. Kunhikannan for the Respondent.
The Judgment of the Court was delivered by BHAGWATI J.
This appeal arises out of proceedings initiated by the Revenue authorities for levying penalty on the assessee.
The assessee is a lady and during the assessment year 1964 65 for which the relevant accounting year was the calender year ended 31st December, 1963, the assessee was a partner in two partnership firms, M/s. Malabar Tile Works and M/s. Malabar Plywood Works and alongwith her there were other partners including her husband and minor daughter.
The assessee filed a return of income for the assessment year 1964 65 showing Rs. 4754 as income from property and Rs. 4748 as income from other sources.
The assessee stated in the return under the column "Profits and Gains of Business and Profession" against item (b) which required share in the profits of a registered firm to be shown "Please ascertain from the firms ' files the Malabar Tile Works and Malabar Plywood Works.
" The assessee, however, did not show in the return the amounts representing the shares of her husband and minor daughter in the firms of M/s. Malabar Tile Works and M/s. Malabar Plywood Works though they were clearly includible in computing the total income of the assessee under section 64 sub section (1) clauses (i) and (iii) of the Income Tax Act, 1961.
The Income Tax Officer while making the assessment included the amounts representing the shares of the assessee 's husband and minor daughter in the profits of these two firms in the assessment of the assessee and taxed the assessee on a total income of Rs. 59,506 after including these amounts.
Since the assessee had not shown these amounts as forming part of her total income in the return submitted by her, though they were clearly includible in her total income under section 64, sub section (1) clauses (i) and (iii), the Income Tax Officer was of the view that the assessee had con 784 cealed the particulars of her income and rendered herself liable to penalty under section 271 sub section (1) clause (c), and since the minimum penalty leviable on the assessee was Rs. 1000, he referred the case to the Assistant Appellate Commissioner who issued notice under section 274 and after hearing the assessee, imposed a penalty of Rs. 1000.
The assessee appealed to the Tribunal against the order imposing penalty and one of the arguments urged on behalf of the assessee in support of the appeal was that there was no obligation of the assessee to show in her return the amounts representing the shares of her husband and minor daughter in the two firms and there was accordingly no concealment by her of the particulars of her income so as to attract the penalty under section 271 sub section (1) clause (c).
The Tribunal accepted this argument of the assessee and held that section 271 sub section (1) clause (c) could be invoked only if there was concealment of the "particulars of his income by the assessee" and the words "his income" referred only to be the income of the assessee himself and not to the income of any other person which might be liable to be included in the income of the assessee by reason of section 64 sub section (1) clauses (i) and (iii).
The Tribunal accordingly held that the omission or failure of the assessee to disclose in her return the amounts representing the shares of her husband and minor daughter in the two firms as forming part of her income could not be visited with penalty under section 271 sub section (1) clause (c) and in this view, the Tribunal allowed the appeal and set aside the order imposing penalty.
This led to the filing of an application for a reference by the Revenue and on the application, the Tribunal referred the following question of law for the opinion of the High Court: "Whether on the facts and in the circumstances of the case, the Tribunal is correct in law in cancelling the penalty levied under section 271(1)(c)?" The High Court took the view that the words used in section 271 sub section (1) clause (c) were "his income" and the amounts representing the shares of the assessee 's husband and minor daughter in the two firms could not be said to be the income of the assessee, though in computing her total income these amounts were liable to be included by reason of section 64 sub section (1) clauses (i) and (iii) and therefore, the assessee could not be said to have concealed her income when she did not disclose these amounts as forming part of her income in the return submitted by her.
The High Court accordingly answered the question referred to it in favour of the assessee and against the Revenue.
The Revenue thereupon preferred the present appeal with special leave obtained from this Court.
785 There is a decision of this court which is directly in point and it concludes the determination of the question arising in this appeal against the Revenue but before we refer to that decision, we might first examine the question on principle as a matter of pure interpretative exercise.
Section 271 sub section (1) clause (c) provides for imposition of penalty on an assessee if it is found inter alia that the assessee has concealed the particulars of "his income.
" The question is what is the scope and content of the words "his income" occurring in this penal provision.
Do they refer only to the income of the assessee himself or do they also take in the income of others which is liable to be included in the computation of the total income of the assessee by reason of the relevant provisions of the Act, such as section 64 sub section (1) clauses (i) and (iii)? The answer to this question obviously depends upon as to what is "his income" which the assessee is liable to disclose for the purpose of assessment for concealment can only be of that which one is bound to disclose and yet fails to do so.
Section 139 provides for filing of a return of income by an assessee and sub section (1) of this section lays down that every person whose total income during the previous year exceeds the maximum amount which is not chargeable to income tax, shall furnish a return of his income in the prescribed form and verified in the prescribed manner, and setting forth such other particulars as may be prescribed.
The return of income is required to be filed in order to enable the Revenue Authorities to make a proper assessment of tax on the assessee.
It must therefore follow a fortiorari that the assessee must disclose in the return every item of income which is liable to be taxed in his hands as part of his total income.
The charge of income tax is levied by section 4 on the total income of the assessee, and 'total income ' is defined in section 2 sub section (45) to mean "the total amount of income referred to in section 5 computed in the manner laid down" in the Act.
It is no doubt true that the definition of 'total income ' in Section 2 sub section (45) refers to section 5 and this latter provision lays down that all the income profits and gains accrued or arisen to the assessee or received by or on behalf of the assessee shall be liable to be included in his total income but this provision is subject to the other provisions of the Act and therefore if the income of any other person is declared by any provision of the Act to be includible in computing the total income of the assessee, such income would form part of the total income exigible to tax under section 4 of the Act.
Now, section 64 subsection (1) is one such provision which provides for inclusion of the income of certain other persons in computing the total income of an assessee.
Clauses (i) and (iii) of this sub section provide that in computing the total income of an assessee there shall be included all 786 such income as arises directly or indirectly to the spouse of such assessee from the partnership of the spouse in a firm carrying on a business in which such individual is a partner as also to a minor child of such assessee from the admission of the minor to the benefits of the partnership firm.
It is clear from this provision that though the share of the spouse or minor child in the profits of a partnership firm in which the assessee is a partner is not the income of the assessee but is the income of such spouse or minor child it is liable to be included in computing the total income of the assessee and it would be assessable to tax in the hands of the assessee.
The total income of the assessee chargeable to tax would include the amounts representing the shares of the spouse and minor child in the profits of the partnership firm.
If this be the correct legal position, there can be no doubt that the assessee must disclose in the return submitted by him, all amounts representing the shares of the spouse and minor child in the profits of the partnership firm in which he is a partner, since they form part of his total income chargeable to tax.
The words "his income" in section 139 sub section (1) must include every item of income which goes to make up his total income assessable under the Act.
The amounts representing the shares of the spouse and minor child in the profits of the partnership firm would be part of "his income" for the purpose of assessment to tax and would have to be shown in the return of income filed by him.
The assessee then contended that the return of income which was required to be filed by her under section 139 sub section (1) was a return in the prescribed form and the form of the return prescribed by rule 12 of the Income Tax Rules, 1962 did not contain any column for showing the income of the spouse and minor child which was liable to be included in the total income of the assessee under section 64 sub section (1) clauses (i) and (iii) and there was therefore no obligation on the assessee to disclose this income in the return filed by her.
This contention is also, in our opinion, fallacious and deserves to be rejected.
It is true that the form of the return prescribed by rule 12 which was in force during the relevant assessment year did not contain any separate column for showing the income of the spouse and minor child liable to be included in the total income of the assessee, but it did contain a Note stating that if the income of any other person is includible in the total income of the assessee under the provisions inter alia of section 64, such income should also bestow in the return under the appropriate head.
This Note clearly required the assessee to show in the return under the appropriate head of income, namely, "Profits and Gains of Business of Profession" the amounts representing the shares of the husband and minor 787 daughter of the assessee in the profits of the two partnership firms.
But even so, the assessee failed to disclose these amounts in the return submitted by her and there was therefore plainly and manifestly a breach of the obligation imposed by section 139 sub section (1) requiring the assessee to furnish a return of her income in the prescribed form.
It is difficult to see how the Note in the prescribed form of the return could be ignored by the assessee and she could contend that despite the Note, she was not liable to show in her return the amounts representing the shares of her husband and minor daughter in the two partnership firms.
The contention of the assessee, if accepted, would render the Note meaningless and futile and turn it into dead letter and that would be contrary to all recognised canons of construction.
There can be no doubt that the assessee was bound to show in her return the amounts representing the shares of her husband and minor daughter in the two partnership firms and in failing to do so, she was guilty of concealment of this item of income which plainly attracted the applicability of section 271 sub section (1) clause (c).
It is obvious that on this view the order imposing penalty on the assessee would have to be sustained but there is a decision of this Court in V.D.M.RM.M.RM.
Muthiah Chettiar vs Commissioner of Income Tax Madras which is binding upon us and where we find that a different view has been taken by a Bench of three Judges of this Court.
It was held in this case that even if there were any printed instructions in the form of the return requiring the assessee to disclose the income received by his wife and minor child from a firm of which the assessee was a partner, there was, in the absence in the return of any head under which the income of the wife or minor child could be shown, no obligation on the assessee to disclose this item of income, the assessee could not be deemed to have failed or omitted to disclose fully and truly all material facts necessary for his assessment within the meaning of section 34(1) (a) of the Indian Income Tax Act, 1922.
With the greatest respect to the learned Judges who decided this case, we do not think, for reasons already discussed, that this decision lays down the correct law on the subject, and had it not been for the fact that since 1st April 1972 the form of the return prescribed by rule 12 has been amended and since then, there is a separate column providing the "income arising to spouse/minor child or any other person as referred to in Chapter V of the Act" should be shown separately under that column and consequently there is no longer any scope for arguing that the assessee is not bound 788 to disclose such income in the return to be furnished by him, we would have referred the present case to a larger bench.
But we do not propose to do so since the question has now become academic in view of the amendment in the form of the return carried out with effect from 1st April 1972.
We would therefore follow this decision in Muthiah Chettiar 's case, which being a decision of a bench of three Judges of this Court is binding upon us, and following that decision, we hold that the assessee could not be said to have concealed her income by not disclosing in the return filed by her the amounts representing the shares of her husband and minor daughter in the two partnership firms.
We accordingly dismiss the appeal, but in the peculiar circumstances of the present case, we think that the fair order of costs would be that each party should bear and pay its own costs throughout.
S.R. Appeal dismissed.
[/INST]The respondent assessee was a partner in the partnership firms of M/s. Malabar Tile Works and M/s. Malabar Plywood Works and alongwith her there were other partners including her husband and minor daughter.
In her returns for the assessment year 1964 65 for which the relevant accounting year was the calendar year ending 31st December, 1963, the assessee filed a return of income omitting the amounts representing the shares of her husband and minor daughter in the partnership firms from her income.
The Income Tax Officer, however, brought the amounts, namely, Rs. 59,506 to tax and referred the case for taking action under section 271(1)(c) of the Act to the Assistant Appellate Commissioner who imposed a penalty of namely, Rs. 7,000 on the assessee for having concealed her income.
In appeal the Tribunal set aside the order and the High Court on reference affirmed the Tribunal 's order.
Hence the appeal by Revenue to this Court after obtaining special leave.
Dismissing the appeal, the Court ^ HELD: (1) The assessee, in view of the fact that the prescribed form for filing of returns under section 139 of the Act, prior to 31st March, 1972, did not contain separate column to show "income arising to spouse/minor child or any other person referred to in Chapter V of the Act", and in view of the decision of three Judges Bench reported in SC could not be said to have concealed her income by not disclosing in the return filed by her the amounts representing the shares of her husband and minor daughter in the two partnership firms.
[788B] (2) The term "his income" for the purpose of section 271(1)(c) of the Act, is "his income" which the assessee is liable to disclose for the purposes of assessment and yet fails to do so.
The return of income under section 139(1) of the Act is required to be filed in order to enable the Revenue Authorities to make a proper assessment of tax on the assessee.
A fortiorari, it follows that the assessee must disclose in the return every item of income which is liable to be taxed in his hands under sections 4 & 5 of the Act.
[785B; F H] 782 (3) The definition of "total income" in section 2(45), no doubt refers to section 5 which lays down that all the income profits and gains accrued or arisen to the assessee or received by or on behalf of the assessee shall be liable to be included in his total income but this provision is subject to the other provisions of the Act and therefore if the income of any other person is declared by any provision of the Act to be includible in computing the total income of the assessee, such income would form part of the total income exigible to tax under section 4 of the Act.
section 64(1) is one such provision which provides for inclusion of the income of certain other persons in computing the total income of the assessee.
[785F H] Section 64(1) makes it clear that though the share of the spouse or minor child in the profits of a partnership firm in which the assessee is a partner is not the income of the assessee but is the income of such spouse or minor child it is liable to be included in computing the total income of the assessee and it would be assessable to tax in the hands of the assessee.
The total income of the assessee chargeable to tax would include the amounts representing the shares of the spouse and minor child in the profits of the partnership firm.
Obviously the words "his income" in section 139 sub section
(1) must include every item of income which goes to make up his total income assessable under the Act.
The amounts representing the shares of the spouse and minor child in the profits of the partnership firm would be part of "his income" for the purpose of assessment to tax and would have to be shown in the return of income filed by him.
[786B D] (4) It is true that the form of the return prescribed by Rule 12 of the Income Tax Rules, 1962 which was in force during the relevant assessment year did not contain any separate column for showing the income of the spouse and minor child liable to be included in the total income of the assessee, but it did contain a Note stating that if the income of any other person is includible in the total income of the assessee under the provisions, inter alia, of section 64, such income should also be shown in the return under the appropriate head.
This Note clearly required the assessee to show in the return under the appropriate head of income, namely, "profits and gains of business or profession" the amounts representing the shares of the husband and minor daughter of the assessee in the profits of the two partnership firms.
The assessee however failed to disclose these amounts in the return submitted by her and there was plainly and manifestly a breach of the obligation imposed by section 139 sub section
(1) requiring the assessee to furnish a return of her income in the prescribed form.
To accept the contention that despite the Note the assessee was still not liable to show in the return the amounts representing the shares of her husband and minor daughter in the two partnership firms would render the Note meaningless and futile and turn it into a dead letter 783 and that would be contrary to all recognised canons of construction.
The assessee was guilty of concealment of this item of income which plainly attracted the applicability of section 271 sub section
(1) clause (c).
[786G 787D] V.D.M.RM.M.RM.
Muthiah Chettiar vs Commissioner of Income Tax, , doubted
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<s>[INST] Summarize the judgementCivil Appeal Nos. 196 199/ 73.
Appeals by Special Leave from the Judgment and order date 14 7 1972 of the Kerala High Court in Income Tax Reference Nos. 115 118 of 1970.
K section Ramamurthy, P. N. Ramalingam and A. T. M. Sampath for the Appellant.
B. B. Ahuja and Miss A. Subhashini for the Respondent.
The Judgment of The Court was delivered by TULZAPURKAR, J.
These appeals by special leave raise an interesting question of law whether the distribution of assets of a firm consequent on its dissolution amounts to a transfer of assets within the meaning of the expression "otherwise transferred" occurring in section 34 (3) (b) of the Indian Income Tax Act, 1961, having regard: to the definition of 'transfer ' in section 2(47) of the Act ? The facts giving rise to the question lie in a narrow compass.
The appellant (M/s Malabar Fisheries Co.) is a dissolved firm represented by one of its erstwhile partners.
The firm as originally constituted on April ], 1959 consisted of four partners and carried on six different business in six different names and styles namely, (a) Malabar Fisheries Co., (b) Coastal Engineering Co., (c) Cochin Tin Factory, (d) Goodwill Industries, all at Falluruthy, (e) Combine Steel Industries at the Industrial Estate at Alavakkot and (f) Lite Metal Industries at Viskhapatnam in Andhra Pradesh.
The firm was dissolved on March 31, 1963 and under the deed of dissolution executed by and between the partners, the first business concern was taken over by one of the partners, the remaining five concerns by two of the other partners and the fourth partner received a sum of Rs. 3,81,082/ in lieu of his respective shares in the assets of all the businesses of the firm.
It appears that during the four assessment years 1960 61 to 1963 64 the firm had installed various items of machinery in respect of which it received development rebate in its respective tax assessments under section 33 of the Act.
On dissolution of the firm on March 31, 1963, the Income tax Officer took the view that section 34 (3) (b) of the Act applied 700 on the ground that there was a sale or transfer of the machinery by the firm within the period mentioned in that section and accordingly acting under section 155 (5) of the Act he withdrew the development rebate allowed to the firm for the said assessment years, the amending, orders being passed against the dissolved firm.
The assesses i.e., the dissolved firm through one of its erstwhile partners preferred appeals against the order of the Income tax officer withdrawing the development rebate but the appellate Assistant Commissioner by his order dated July 24, 1964 dismissed the appeals holding that section 155(5) was rightly resorted to since section 34 (3) (b) of the Act applied to the case.
The matter was carried in further appeals; by the dissolved firm to the Income tax Appellate Tribunal, Cochin Bench, Ernakulam, and it was contended that the distribution of the assets of the firm consequent on its dissolution did not amount to a sale or transfer and, therefore, the transaction would not come within the purview of section 34 (3) (b).
The Tribunal by its common order dated January 6, 1970 allowed the appeals holding that the case fell within the principle laid down by this Court in the case of Commissioner of Income tax vs Dewas Cine Corporation and that there was no question of any sale or transfer within the meaning of section 34(3) (b) in a transaction involving the adjustment of the rights of the partners of a dissolved firm.
At the instance of the Revenue, the Tribunal referred two questions of law to the High Court for its opinion, namely "(1) Whether on the facts and in the circumstances of this case, the Appellate Tribunal was legally correct in holding that there was no question of sale and that it was only an adjustment of the mutual rights of the partners and that the provisions of section 34 (3) were not applicable ? (2) Whether on the facts and in the circumstances of this case, there was a transfer of assets within the meaning to the words 'otherwise transferred ' occurring in Section 34(3) (b) to the Income Tax Act ?" The High Court answered the second question in the affirmative and against the assessee and in view of that answer, declined to answer first question as being unnecessary.
The High Court took the view that this Court 's decisions in Dewas Cine Corporation case (supra) and Bankey Lal Vaidya 's case to the effect that the distribution, division or allotment of assets between partners of 701 firm consequent on its dissolution amounts to a mutual adjustment of rights of the partners and does not amount to a sale or transfer had been rendered under the Income Tax Act, 1922 wherein the expression 'sale ' or 'transfer ' had not been defined whereas in the 1961 Act by which the case was governed, the expression 'transfer ' had been defined by section 2(47) in a very wide manner so as to include not merely a sale or exchange but also 'extinguishment of any rights ' in capital assets.
The High Court hold that a dissolution of a firm amounted to extinguishment of the rights of the firm in the assets of the partnership and accordingly was a transfer within the meaning of section 2(47) of the Act and that, therefore, the provisions of section 34(3) (b) applied to the case.
It is this view of the High Court that is being challenged before us in these appals by the assessee.
Counsel for the assessee contented that the High Court has clearly erred in taking the view that the dissolution of a firm amounts to extinguishment of the rights of the firm in the assets of the partnership.
be pointed out that in the two decisions referred to above this Court has clearly enunciated what happens in law upon the dissolution of a firm namely, that the distribution, division or allotment of assets between the partners on dissolution of the firm is merely an adjustment of rights inter se between them and that no sale or transfer is involved in such distribution, division or allotment.
According to him there is no change in this legal position even after the enactment of the definition of 'transfer ' in section 2(47) in the 1961 Act.
Reference was made to this Court 's decision in C.I.T. Gujarat vs R. M. Amin where this Court has held that no transfer of capital assets within the meaning of section 2 (47) of the, 1961 Act was involved when a shareholder received money representing his shares on the distribution of the net assets of the company in liquidation, that he must be regarded as having received that money in satisfaction of the rights which belonged to him by virtue of his holding the shares and that the transaction did not amount to any sale, exchange, relinquishment of capital assets or extinguishment of any rights therein.
In any case, he contended that in every case dissolution must be anterior in point of time to the distribution that takes place after making accounts and discharging all debts and.
liabilities and as such there is no transfer of any assets by the assessee (i.e. the dissolved firm) to any person as contemplated by section 34(3) (b), but all that happens is that upon dissolution and upon making up of accounts and discharge of liabilities it is the erstwhile partners who mutually adjust their rights and it is by way of adjustment of such rights 702 that distribution, division or allotment of assets takes place.
He, therefore urged that section 34 (3) (b) was inapplicable to the case.
On the other hand, counsel for the Revenue pressed the High Court 's view for our acceptance.
He urged that the question has to be considered under the 1961 Act in light of the definition of 'transfer ' contained in section 2 (47) which includes within its scope even 'extinguishment of rights in capital assets '.
According to him , during the continuance of the partnership the machinery undoubtedly belonged to the firm, the firm as a separate taxable entity got the benefit Of development rebate which was sought to be withdrawn in as much as the firm 's rights in the machinery got extinguished upon dissolution and the same got transferred or vested ill individual partner or partners as a result of distribution or allotment made between them be stated qua the.
erstwhile partners there may not be any transfer of assets and there may be mutual adjustment of rights but qua the firm there is certainly extinguishment of its rights in the assets of the partnership and in that sense there is a transfer of assets within the definition under section 2 (47) of the Act.
Since in these appeals the question raised relates to the withdrawal of development rebate under section 34 (3) (b) read with section 155 (5) of the 1961 Act in the light of the definition of the expression transfer given.
under section 2 (47) of the Act, it will be desirable to note what these provisions are.
Section 34 (3) (b) in so far as is material reads: "34.
Conditions for depreciation allowance and development rebate.
x x x x x 3(b) If any ship, machinery or plant is sold or otherwise transferred by the assessee to any person at any time before the expiry of eight years from the end of the previous year in which it was acquired or installed, any allowance made under section 33 or under the corresponding provisions of the Indian Income tax Act, 1922 (XI of 1922), Gin respect of the ship, machinery or plant shall be deemed to have been wrongly made for the purposes of this Act, and the provisions of sub section (5) of section 155 shall apply accordingly." Section 155(5) is a procedural provision enabling the Income tax Officer in a case falling under section 34(3) (b) to recompute the total income of the assessee for the relevant previous year and make the necessary amendments; in other words, acting under this provision the 703 Income tax officer withdraw is the development rebate already granted A by passing an amending order.
It further provides that such amending order has to be passed within a period of 4 years to be reckoned from the end of the previous year in which the sale or transfer took place.
Section 2(47) defines the expression "transfer" thus: "2(47) "transfer", in relation to a capital asset, includes the sale, exchange or relinquishment of the asset or the extinguishment of any rights therein or the compulsory acquisition thereof, under any law.
" On a plain reading of section 34(3) (b) it will appear clear that before that provision can be invoked or applied three conditions are required to be satisfied: (a) that the ship, machinery or plant must have been sold or otherwise transferred, (b) that such a sale or transfer must be by the assessee and (c) that the same must be before the expiry of 8 years from the end of the previous year in which it was acquired or installed.
It is only when these three conditions are satisfied that any allowance made under section 33 shall be deemed to have been wrongly made and the Income tax officer acting under section 155(5) will be entitled to withdraw such allowance.
Further, section 2(47) gives an artificial extended meaning to the expression 'transfer ' for, it not merely includes transactions of 'sale ' and 'exchange ' which in ordinary par lance would mean transfers but also 'relinquishment ' or 'extinguishment of rights ' which are ordinarily not included in that concept.
The question is whether the distribution, division or allotment of assets of firm consequent on its dissolution amounts to a transfer of assets within the meaning of the words "otherwise transferred" occurring in section 34(3) (b) of the Act, regard being had to the definition of "trans for" contained in section 2(47) ? To put it pithily, the question is whether the dissolution of a firm extinguishes the firm 's rights in the assets of the partnership so as to constitute a transfer of assets under section 2(47) ? In Dewas Cine Corporation case (supra) the concept of distribution of assets consequent upon the dissolution of the firm was considered in the context of the balancing charge arising under the second proviso to section 10(2) (vii) of the 1922 Act.
In that case two individuals, each of whom owne da cinema theatre, formed a partnership to carry on business of exhibition of cinematograph films, bringing the theatres into the books of the firm as its assets.
For the assessment years 1950 51 to 1952 53 the Income Tax Officer allowed depreciation aggregating to Rs. 44,380/ in the assessment of the firm in respect of the two theatres.
On the dissolution of the firm on September 30.
704 1951, the theatres were returned to their original owners.
In the books of the firm the assets were shown as taken over at the original price less the depreciation allowed, the depreciation being equally divided between the two erstwhile partners.
The Tribunal took the view that by restoring the theatres to the original owners there was a transfer by the partnership and the entries adjusting depreciation and writing off the assets at the original value amounted to local recoupment of the entire depreciation by the partnership and on that account the balancing charge arose under the second proviso to section 10(2) (vii) of the Act.
This Court held that on the dissolution of the partnership, each theatre had to be deemed to be returned to the original owner in satisfaction partially or wholly of his claim to a share in the residue of the assets after discharging the debts and other obligations.
But thereby the theaters were not in law sold by the partnership to the individual partners in consideration of their respective shares in the residue, and, therefore, the amount of Rs. 44,380/ could not be included in the total income of the partnership as a balancing charge arising under the second proviso to section 10(2)(vii).
It is true that this Court was concerned with interpreting the expression "sold" used in section 10(2) (vii) and the second proviso thereto, when the expressions "sale or sold" had nowhere been defined in the Act, and, therefore, this Court held that those expressions when used in section 10(2) (vii) and the second proviso thereto must be understood in their ordinary meaning and that "sale" according to its ordinary meaning meant a transfer of property for a price.
This Court further enunciated the proposition that the distribution of surplus upon dissolution of a partnership after discharging its debts and obligations was always by way of adjustment of rights of partners in the assets of the partnership and did not amount to a transfer much less for a price.
It is significant to note that the question of raising a balancing charge against the dissolved firm, a separate taxable entity which had been allowed depreciation in the earlier years, was considered by this Court and this Court took the view that no balancing charge arose against the firm inasmuch as no sale or transfer was involved in the transaction of distribution of the assets to erstwhile partners of the firm consequent upon its dissolution.
In Bankey Lal Vaidya 's case (supra) the concept of distribution of assets to the partners of a firm consequent upon its dissolution was considered in the context of the charge on capital gains arising under 'H section 128(1) of the 1922 Act.
In that case the respondent assessee, the Karta of a Hindu undivided family, entered into a partnership with to carry on business of manufacturing and selling pharmaceutical 705 products and literature relating thereto.
On the dissolution of the partnership, its assets, which included goodwill, machinery, furniture, medicines, library and copyright in respect of certain publications, were valued at Rs. 2,50,000.
Since a large majority of assets was incapable of physical division, it was agreed that the assets be taken over by and the respondent assessee be paid his share of the value of the assets in money and accordingly he was paid Rs. 1,25,000/ .
The question was whether the sum of Rs. 65,000/ , being part of the amount received by the respondent assessee could be brought to tax as capital gains under section 12B(1) of the Act ? This Court held that the arrangement between the partners of the firm amounted to a distribution of the assets of the firm on dissolution, that there was no sale or exchange of the respondent 's share in the capital assets to D, nor did he transfer his share in the capital assets and, therefore, the sum of Rs. 65,000/ could not be taxed as capital gains.
The Court observed that the rights of the parties were adjusted by handing over to one of the partners the entire assets and to the other partner the money value of his share and such a transaction was neither a sale nor exchange nor transfer of assets of the firm.
It cannot, however, be disputed that both these decisions were rendered under the 1922 Act which did not define expressions like "sale" or "transfer" and the question is whether any difference is E; made in the legal position under the 1961 Act by reason of the enactment of the definition of the expression "transfer" in section 2(47), which includes within its scope a transaction by way of 'extinguishment of any rights in a capital asset ' ? The precise argument which has been advanced by the counsel for the Revenue before us, and which found Favour with the High Court is that during the continuance of the partnership the machinery belonged to the firm, that the firm as a taxable entity received the benefit of development rebate in respect thereof under section 33 of the Act and that upon dissolution the firm 's rights in the machinery got extinguished and became vested in the partner or partners to whom it was allotted in the distribution of assets, and, therefore, the transaction so far as the firm is concerned amounts to a transfer of assets under section 2(47).
The question is how far is it correct to say that in law the firm as such has rights in the partnership assets liable to extinguishment upon dissolution ? It is well known that commercial men and accountants on the one hand and lawyers on the other have different notions respecting the nature of the firm and this difference between the mercantile view and 706 the legal view has been explained in Lindley on Partnership 12th Edn.
at pages 27 and 28 thus: "Partners are called collectively a firm.
Merchants and lawyers have different notions respecting the nature of a firm Commercial man and accountants are apt to look upon a firm in the light in which lawyers look upon a corporation i.e., as a body distinct from the members composing it, and having rights and obligations distinct from those of its members.
Hence, in keeping partnership accounts, the firm is made debtor to each partner for what he brings into the common stock, and each partner is made debtor to the firm for all that he takes out of that stock.
In the mercantile view, partners are never indebted to each other in respect of partnership transactions; but are always either debtors to or creditors of the firm Owing to this impersonification of the firm, there is tendency to regard its rights and obligations as unaffected by the introduction of a new partner, or by the death or retirement of an old one.
Notwithstanding such changes among its members, the firm is considered as continuing the same; and the rights and obligations of the old firm are regarded as continuing in favour of or against the new firm as if no changes had occurred.
The partners are the agents and sureties of the firm, its agent for the transaction of its business, its sureties for the liquidation of its liabilities so far as the assets of the firm are insufficient to meet them.
The liabilities of the firm are regarded as the liabilities of the partners only in case they cannot be met by the firm and discharged out of its assets.
But this is not the legal notion of a firm.
The firm is not recognised by English lawyers as distinct from the members composing it.
In taking partnership accounts and in administering partnership assets, Courts have to some extent adopted the mercantile view, and actions may now, speaking generally, be brought by or against partners in the name of their firm; but speaking generally, the firm as such has no legal recognition.
The law, ignoring the firm, looks to the partners com posing it; any change amongst them destroys the identity of the firm; what is called the property of the firm is their property, and what are called the debts and liabilities of the firm are their debts and their liabilities.
In point of law, a partner may be the debtor or the creditor of his co partners, 707 but he cannot be either debtor or creditor of the firm of which he is himself a member, nor can he be employed by his firm, for a man cannot be his own employer".
(Emphasis supplied) .
Unlike the Scottish system of law where the firm is a legal person distinct from the partners composing it, the English Partnership Act, 1890, avoids making a firm a distinct legal entity.
In English jurisprudence a firm is only a compendious name for certain persons who carry on business, or have authorised one or more of their number to carry it on, in such a way that they are jointly entitled to the profits and jointly liable for the debts and losses of the business.
Further it is true that partnership property is regarded as belonging to the firm, but that is only for the purpose of distinguishing the same form the separate property of the partners.
But, in law the partnership property is jointly owned by all the partners composing the firm.
In Lindley on Partnership at page 359 the following statement of law occurs: "The expression partnership property, partnership stock, partnership assets, joint stock, and joint estate, are used indiscriminately to denote everything to which the firm, or in other words all the partners composing it, can be considered to be entitled as such.
" Again at page 375 the following statement of law occurs: "In the absence of a special agreement to that effect, all the members of an ordinary partnership are interested in the whole of the partnership property, but it is not quite clear whether they are interested therein as tenants in com mon, or as joint tenants without benefit of survivorship, if indeed there is any difference between the two.
It follows from this community of interest that no partner has a right to take any portion of the partnership property and to say that it is his exclusively.
No partner has any such right, either during the existence of the partnership or after it has been dissolved.
" As regards the nature of a share of a partner in a firm the following passage in Lindley on Partnership at page 375 brings out legal position very clearly: "What is meant by the share of a partner in his proportion of the partnership assets after they have been all realised and converted into money, and all the partnership debts and 708 liabilities have been paid and discharged.
This it is, and this only, which on the death of a partner passes to his representative, or to a legatee of his share. and which ; on his bankruptcy passes to his trustee.
" The position as regards the nature of a firm and its property in Indian .
law under the is almost the same as in English law.
Here also a partnership firm is not a distinct legal entity and the partnership property in law belongs to all the partners constituting the firm.
In Bhagwanji Morarji Goculdas vs Alembic Chemcial Works Co. Ltd. and others the Privy Council in para 10 of the judgment observed thus: "Before the Board it was argued that under the , a firm is recognised as an entity apart from the persons constituting it, and that the entity continues so long as the firm exists and continues to carry on its business.
It is true that the goes further than the English Partnership Act, 1890, in recognising that a firm may possess a personality distinct from the persons constituting it; the law in India in that respect being more in accordance with the law of Scotland, than with that of England.
But the fact that a firm possesses a distinct personality does not involve that the personality continues unchanged so long as the business of the firm continues.
The Indian Act, like the English Act, avoids making a firm a corporate body enjoying the right of perpetual succession.
(Emphasis supplied).
It is true that under the Civil Procedure Code order XXX, as under the English Rules of Court, actions may be brought by or against partners in the name of the firm and even between firms and their members but that is only a matter of procedure.
It is also true that the firm 's property is recognised in more than one way (sections 14 and 15 of the Partnership Act) but only as that which is "joint estate" of all the partners as distinguished from the "separate estate" of any of them, and not as belonging to a body distinct in law from its members.
In Addanki Narayanappa & Anr.
vs Bhaskara Krishnappa and 13 Ors, this Court after quoting with approval the aforementioned passages occurring in Lindley on Partnership, 12th Edn., made the following observations in the context of partners ' right during the subsistence as well as upon the dissolution of a firm: 709 "No doubt since a firm has no legal existence, the partnership property will vest in all the partners and in that sense every partner has an interest in the property of the partnership.
During the subsistence of the partnership, how ever, no partner can deal with any portion of the property as his own nor can he assign his interest in a specific item of property of any one.
His right is to obtain such profits, if R any, as fall to his share from time to time and upon the dissolution of the firm to a share in the assets of the firm which remain after satisfying the liabilities set out in cl.
(a) and sub cls.
(i), (ii) and (iii) of cl.
(b) of section 48.
" Having regard to the above discussion, it seems to us clear that a partnership firm under the is not a distinct legal entity apart from the partners constituting it and equally in law the firm as such has no separate rights of its own in the partnership assets and when one talks of the firm 's property.
Or firm 's assets all that is meant is property or assets in which all partners have a joint or common interest.
If that be the position, it is difficult to accept the contention that upon dissolution the firm 's rights in the partnership assets are extinguished.
The firm as such has no separate rights of its own in the partnership assets but it is the partners who own jointly in common the assets of the partnership and, therefore, the consequences of the distribution, division or allotment of assets to the partners which flows upon dissolution after discharge of liabilities is nothing but a mutual adjustment of rights between the partners and there is no question of any extinguishment of the firm 's rights in the partnership assets amounting to a transfer of assets within the meaning of section (47) of the Act.
In our view, therefore, there is no transfer of assets involved even in the sense of any extinguishment the firm 's rights in the partnership assets when distribution takes place upon dissolution.
Counsel for the Revenue referred us to a decision of the Karnataka High Court in Additional Com missioner of Income Tax vs M. A. J. Vasanaik, where that Court has taken the view that when individual assets are brought in a partnership firm so as to constitute the partnership property, there is a transfer of interest of the individual to the partnership and sections 34(3) (b) and 155(5) of 1961 Act are attracted.
In the first instance, that decision dealt with the converse case and it does not necessarily follow on parity of reasoning that the distribution, division or allotment of partnership assets to partners of a firm upon its dissolution would amount to a transfer of assets as was sought to be contended by the counsel for the Revenue.
Secondly, it is unnecessary 710 for us to express any opinion on the correctness or otherwise of the view taken by the Karnataka High Court in that case.
There is yet another reason for rejecting the contention of the counsel for the Revenue and that is that the second condition required to be satisfied for attracting section 34(3) (b) cannot be said to have been satisfied in the case.
It is necessary that the sale or transfer of assets must be by the assessee to a person.
Now every dissolution must h point of time be anterior to the actual distribution, division or allotment of the assets that takes place after making accounts and discharging the debts and liabilities due by the firm.
Upon dissolution the firm ceases to exist; then follows the making up of accounts, then the discharge of debts and liabilities and there upon Distribution, division or allotment of assets takes place inter se between the erstwhile partners by way of mutual adjustment of rights between them.
The distribution, division or allotment of assets to the erstwhile partners, is not done by the dissolved firm.
In this sense there is no transfer of assets by the assessee (dissolved firm) to any person.
It Dis not possible to accept the view of the High Court that the distribution of assets effected by a deed takes place eo instanti ' with the dissolution or that it is effected by the dissolved firm.
In the result we are clearly of the view that section 34(3)(b) of the Act was not applicable to the case and we uphold the view of the Tribunal.
The appeals are, therefore, allowed and the Revenue will pay the costs of the appeals to the appellant.
[/INST]The assessee was incorporated for the purpose of taking over cf certain zamindari properties.
By an indenture the assessee took a lease of extensive zamindari properties for a term of 999 years and also took an assignment OF moveables.
In consideration of the lease and assignment, fully paid shares worth Rs. 4.08 lakhs were issued in the new company to the lessors.
The quit rent receivable by the lessors was a nominal amount of Rs. 100 per annum.
Clause (3) (a) of the Memorandum of Association showed that the assessee was primarily incorporated for the purpose of taking over the assets of the lessor 's family, while cl.
(b) empowered the assessee to purchase, take on lease or otherwise acquire and to traffic in land and generally deal in or traffic by way of sub lease with land and house property.
The assessee thereafter started giving out on sub lease various parcels of land to colliery companies for various terms of long duration.
Rejecting the assessee 's contention that the total amount of salami premia and compensation received by the assessee in three assessment years were of a capital nature, the Income Tax officer treated the amounts as income from business and taxed them.
The Appellate Assistant Commissioner as well as the Appellate Tribunal held in favour of the assessee on the ground that She transactions of granting sub leases were by way of management of the property by the assessee and receipts on account of salami premia and compensation on acquisition of land were of capital nature not liable to be taxed as income.
On reference the High Court was of the view that the assessee could not be regarded as a purely family concern incorporated for the preservation and management of the family assets but was a trading concern which dealt with the lease hold rights in the lands as trading assets by using them to earn income and, therefore, salami, premia and compensation were trading receipts.
Allowing the appeal, ^ HELD: 1.
Having regard to the nature of the various transactions it is clear that the receipts on account of salami etc., must be regarded as receipts of a capital nature.
Similarly the amounts of compensation received by the assessee for compulsory acquisitions of portions of land partake the character of capital receipt in as much as compulsory acquisition could not be said to be a voluntary transaction, and compensation received would be a substitute for the capital asset lost by the assessee.
[722D] 712 2. Ownership of property and leasing it out may be done as part of a business or it may be done as land owner.
Whether it is the one or the other must necessarily depend upon the object with which the act is done.
Where a company is formed with the specific object of acquiring properties not with the view to leasing them as property but to selling them or turning them to account even by way of leasing them out as an integral part of its business, it can be said that the company has treated them as trader and not as land owner.
In deciding whether a company dealt with its properties as owner one must see not to the form which it gave to the transactions but to the substance of the matter.
[717 H] 3.
On the other hand incidental sale of uneconomic or inconvenient plots of land could not convert what was essentially an investment into a business transaction in real estate.
The purposes or objects for which a limited company was incorporated has no decisive bearing on the question whether the income is of capital nature or a revenue receipt.
The circumstance that a single plot of land was acquired and was thereafter sold as a whole or in plots is not decisive either.
Nor is profit motive in entering into a transaction decisive.
The question whether in purchasing and selling land the tax payer entered into a business activity has to be determined in the light of the facts and circumstances of each case.
[719 C D] P.K.N. Company vs Commissioner of Income Tax, 60 R 65.
Karapura Development Co. Ltd. vs Commissioner of Income Tax, West Bengal.
, discussed.
In the instant case the High Court had erroneously treated the assessee as a trading concern qua its lease hold interest in the zamindari estate without actually examining the real nature and object of the transactions of sub leases entered into by the assessee with several colliery companies.
In coming to this conclusion the High Court was influenced by three factors: (a) existence of power in the memorandum of association enabling the company to indulge in trafficking in land by way of sub leases of land; (b) declaration of dividend at a high rate and (c) creation of reserve fund by the assessee pursuant to certain articles of association.
The special features of declaration of dividend and creation of a reserve fund are not features peculiar to a trading concern because a non trading incorporated entity like an investment company can declare dividends and create a reserve fund.
These special features are not decisive of the question whether the incorporated entity is a trading concern or not.
What is of importance is how it has dealt with its assets or properties.
The assessee, which had been incorporated for the purpose of preservation and management of the family estate of the lessors had dealt with Its leasehold interest as a land owner and not as a trader.
This was clear from the Memorandum and Articles of Association and the draft agreement in accordance with which the indenture was executed.
Nominal rent of Rs. 100 p.a. and the assignment of moveables in favour of the assessee also point to the same conclusion.
Secondly, since its inception the assessee had not taken lease of any other property from anyone else.
Thirdly, the transaction of granting subleases of coal bearing and other lands were by way of management of the estate as land owner.
Fourthly, though the memorandum of association authorised the assessee to do business in collieries it did not work any colliery of its own not did it do any business as miners or coal dealers.
[720 F H] 713
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<s>[INST] Summarize the judgementSpecial Leave Petition (Civil) Nos.
1731 and 927 of 1978.
From the Judgment and order dated 3 11 76 of the Allahabad High Court (Lucknow Bench) in W.P. 116 of 1971 and from the Judgment and order dated 5 8 77 of the Allahabad High Court (Lucknow Bench) in Revision Application No. 29/77 respectively.
R. K. Garg, Madan Mohan and V. J. Francis for the Petitioner.
The order of the Court was delivered by KRISHNA IYER, J.
For around 50 years, a man and a woman, as the facts in this case unfold, lived as husband and wife.
An adventurist challenge to the factum of marriage between the two, by the petitioner in this special leave petition, has been negatived by the High Court.
A strong presumption arises in favour of wed lock where the partners have lived together for a long spell as husband and wife.
Although the presumption is rebuttable, a heavy burden lies on him who seeks to deprive the relationship of legal origin.
Law leans in favour of legitimacy and frowns upon bastardy.
In this view, the contention of Shri Garg, for the petitioner, that long after the alleged marriage, evidence has not been produced to sustain its ceremonial process by examining the priest or other witnesses, deserves no consideration.
If man and woman who live as husband and wife in society are compelled to prove, half a century later, by eye witness evidence that they were validly married, few will succeed.
The contention deserves to be negatived and we do so without hesitation.
The special leave petitions are dismissed.
S.R. Petitions dismissed.
[/INST]The appellant paid the correct court fee under Section 37(2) of the Madras Court Fees and Suits Valuation Act clearly alleging in para 14 of the plaint that she is in joint possession and is seeking partition and separate possession of her half share in the suit properties as heir of deceased Paramayee.
The preliminary objection as to the correct court fee payable raised and taken up resulted in the final appeal before this court.
Allowing the appeal by Special Leave, the Court ^ HELD: (a) Courts should be anxious to grapple with the real issues and not spend their energies on peripheral ones.
[68H, 69A] (b) Court fee, if it seriously restricts the right of a person to seek his remedies in Courts of justice should be strictly construed.
Since access to justice is the basis of the legal system, where there is a doubt, reasonable of course, the benefit must go to him who says that the lesser court fee alone be paid.
[69A] In the instant case, the court fee that is payable is under s.37(2) of the State Act, which corresponds to article 17 D of the Court Fees & Suits Valuation Central Act, which is the predecessor legislation on the subject.
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<s>[INST] Summarize the judgements by special leave from the judgments and orders dated November 27, 1961 of the Gujarat High Court in Special Civil Applications Nos. 704 and 707 of 1961.
140 Arun Naginlal Surti, B. Datta and J. B. Dadachanji, for the appellants.
A. K. Sen, M. section K. Sastri and B. R. G. K. Achar, for the respondents.
The Judgment of the Court was delivered by Ramaswami, J.
These four consolidated appeals are brought, by special leave, against the order of the High Court of Gujarat dated November 27, 1961 summarily dismissing four Special Civil Applications Nos.
704 to 707 of 1961 which had been filed by the appellants under article 227 of the Constitution of India for quashing the order of the Gujarat Revenue Tribunal dated July 18, 1961.
The appellants had applied for compensation to the Jagir Abolition Officer, Baroda under section 13 of the Bombay Merged Territories & Areas (Jagirs Abolition) Act, 1953, hereinafter referred to as the 'Jagirs Abolition Act ', in respect of their proprietary jagirs.
Against the award of compensation made by the Jagir Abolition Officer the appellants preferred appeals under section 16 of the Jagirs Abolition Act.
Although these appeals were filed before the Revenue, Tribunal at Bombay, the appeals were transferred, on the bifurcation of Bombay State, to the Gujarat Revenue Tribunal at Ahmedabad, hereinafter called the 'Tribunal '.
All these appeals were ultimately dismissed by the Tribunal for non prosecution on account of non appearance of the advocate of the appellants.
Against the dismissal of the appeals for non prosecution the appellants filed applications for restoration before the Tribunal on May 6, 1961.
The appellants contended that since the orders passed dismissing the appeals were received by them on April 9 and April 20, 1961, the restitution applications filed on May 6, 1961 were within 30 days of the receipt of the order of dismissal and hence the applications for restoration were made in time under Regulation 21 of the Bombay Revenue Tribunal Regulations.
The appellants also prayed that the applications for restoration should be allowed as they were prevented for sufficient cause from appearing at the hearing of the appeals.
The Tribunal rejected the applications holding that they were barred under article 168 of the Limitation Act read with Regulation 55 and 0.41, rr. 17 and 19 of the Civil Procedure Code.
The view taken by the Tribunal was that the applications for restoration should have been made within 30 days from the date of the order of dismissal.
As the orders of dismissal was made on February 1, 2 and 3, 1961 and the applications for restoration were made only on May 6, 1961, the Tribunal held that they were time barred.
Aggrieved by the order of dismissal of the restoration applications the appellants moved the High Court of Gujarat under article 227 of the Constitution of India but their applications were dismissed in Iimine.
The first question for consideration is whether the orders of the Tribunal dated February 1, 2 and 3, 1961 are illegal and ultra 141 vires because the Tribunal dismissed the appeals for non prosecution and there was no decision of the appeals on merits.
It was contended that it was obligatory on the part of the Tribunal to decide the appeals on merits and record its decision in view of section 17 of the Jagirs Abolition Act which states as follows: "17.
(1) The Bombay Revenue Tribunal shall, after giving notice to the appellant and the State Government, decide the appeal and record its decision.
(2)In deciding an appeal under this Act the Bombay Revenue Tribunal shall exercise all the powers which a court has and shall follow the same procedure which a Court follows in deciding appeals from the decree or order of an original Court under the Code of Civil Procedure, 1908.
" in our opinion, the contention put forward by the appellants is well founded and must be accepted as correct.
Section 13 of the Jagirs Abolition Act provides that any jagirdar entitled to compensation under section 11 or 12 shall, on or before the 31st day of July 1958 apply in writing to the Collector for determining the amount of compensation payable to him under the said section.
Section 13(2) states that on receipt of an application under sub section
(1), the Collector shall, after making formal enquiry in the manner provided by the Code, make an award determining the amount of compensation.
Section 14 of the Jagirs Abolition Act states as follows: "14.
(1) If any person other than a jagirdar is aggrieved by the provisions of this Act as abolishing, extinguishing or modifying any of his rights to, or interest in property and if compensation for such abolition, extinguishment or modification has not been provided for in the provisions of this Act, such person may apply to the Collector for compensation.
(2) The application under sub section (1) shall be made to the Collector in the prescribed form on or before the 31st day of July 1958.
The Collector shall, after holding a formal inquiry in the manner provided by the Code, make an award determining the compen sation in the manner and according to the method provided for in sub section (1) of section 23 and section 24 of the Land Acquisition Act, 1894.
" Section 15 states that "every award made under section 13 or 14 shall be in the form prescribed in section 26 of the Land Acquisition Act, 1894 and the provisions of the said Act shall, so far as may be, apply to the making of such award".
Section 16 provides 142 for an appeal against the Collector 's award and is to the following effect: "16.
An appeal shall lie against an award of the Collector to the Bombay Revenue Tribunal constituted under the Bombay Revenue Tribunal Act, 1957 notwithstanding anything contained in the said Act.
" Section 20 provides for the finality of the award and of the decision of the Revenue Tribunal and reads as follows: "20.
The award made by the Collector subject to an appeal to the Bombay Revenue Tribunal and the decision of the Bombay Revenue Tribunal on the appeal shall be final and conclusive and shall not be questioned in any suit or proceeding in any Court.
" On a consideration of the language of section 17(1) of the Jagirs Abolition Act and in the context of section 20 of the Jagirs Abolition Act we are of the opinion that it is obligatory on the part of the Tribunal to decide an appeal on merits even though there is default in the appearance of the appellants and to record its decision regarding the merits of the appeal.
If an appeal is dismissed for want of prosecution it cannot be said that the Tribunal has 'decided the appeal ' and 'recorded its decision ' within the meaning of section 17 of the Jagirs Abolition Act.
It cannot be supposed that the legislature intended by the word 'decide ' in section 17(1) to mean 'dispose of the appeal or to put an end to the appeal '.
It is important to notice that section 20 of the Jagirs Abolition Act makes a decision of the Tribunal in appeal as final and conclusive and not to be questioned in any suit or proceeding in any Court.
In the context of section 20 and in view of the express language of section 17(1) of the Jagirs Abolition Act we are of opinion that the Tribunal has no power to dismiss an appeal for non prosecution but it is obligatory on its part to decide the appeal on merits and to record its decision even though there is default on the part of the appellant to appear in the appeal.
The second question of law for consideration in this case is whether, on a proper construction of Regulations 19, 20 and 21 of the Bombay Revenue Tribunal Regulations, 1958, the Tribunal was right in taking the view that the applications for restoration made by the appellants were barred by limitation.
Section 14 of the Bombay Revenue Tribunal Act (Bombay Act No. XXXI of 1958) deals with the practice and procedure to be followed by the Gujarat Revenue Tribunal.
Section 14 states: "14.
(1) Subject to the provisions of this Act and to the previous approval of the State Government, the President may make regulations for regulating the practice and procedure of the tribunal, including the award of costs by the Tribunal, the levy of any process fee, the right of audience before the Tribunal, the sittings of the members either singly, or in 143 benches constituted by the President or such member as is authorised by him from amongst the members of the Tribunal, the disposal by the Tribunal, or a bench thereof, of any proceedings before it notwithstanding that in the course thereof there has been a change in the persons sitting as members of the Tribunal or bench; and generally for the effective exercise of its powers and discharge of its functions under this Act.
Where any members sit singly or where any benches are constituted, such member or bench shall exercise and discharge all the powers and functions of the Tribunal.
(2) The regulations made under this section shall be published in the Official Gazette.
" Regulation 19 deals with procedure to be followed by the Tribunal in case of non appearance of parties.
Regulation 19 is to the following effect: "19.
(1) If on the date fixed for hearing or any other subsequent day to which the hearing may be adjourned, the appellant or applicant does not appear either in person or through his agent or lawyer when the appeal or application is called for hearing, the Tribu nal may dismiss the appeal or application or may decide it on merits, after hearing the respondent or his agent or lawyer, if present.
(2) If on the date fixed for hearing or on any other subsequent day to which the hearing may be adjourned, the respondent or opponent, as the case may be, does not appear in person or through his agent or lawyer when the appeal or application is called for hearing the Tribunal may decide the same on merits, after hearing the appellant or applicant or his agent or lawyer. . . . " Regulation 20 provides for restoration of an appeal or application and reads as follows: "20.
If any of the parties was absent on the date of the hearing, either preliminary or final, and the appeal or application was heard and declared ex parte, the party concerned may apply for restoration of the appeal or application, as the case may be, and if the party satisfies the Tribunal that he had no notice of the date of the bearing or that be was prevented by sufficient cause from appearing when the appeal or application was called for hearing, the Tribunal may restore the appeal or application to its file, provided that where the other party had appeared in the appeal or application such party shall be given notice and an opportunity of being heard before the order for resto ration of the appeal or application is made.
" 144 Regulation 21 is to the following effect: (1) An application for restoration of an appeal or application made under regulation 20 shall be filed within thirty days from the date of the receipt of the order or dismissal of the appeal or application and shall be accompanied by (a) a certified copy of the Tribunal 's order; (b) the decision or order (either in original or a certified copy thereof) in respect of which appeal or application sought to be restored is made; (c) if the decision or order referred to in clause (b) is itself made in appeal against any decision or order, then also such latter decision or order either in original or a certified copy thereof; and (d) as many copies of the restoration application as there are respondents or opponents.
. . . . . . . .".
Regulation 55 states that in any matter not provided for in the Regulations the Tribunal shall follow the procedure, as far as it is applicable, laid down in the Code of Civil Procedure, 1908.
From the scheme of the Regulations it is apparent that under Regulation 19(1) it is open to the Tribunal to dismiss an appeal for non prosecution in a case where the appellant does not appear either in person or through his agent or lawyer.
It is also open to the Tribunal in such a case to hear the respondent to the appeal and decide it on merits.
Regulation 19(2) contemplates a case where the respondent fails to appear and even so it is open to the Tribunal to hear the appellant and then decide the case on merits.
Regulation 20 which provides for restoration of the appeal is a, consequential regulation to Regulation 19.
One of the conditions for invoking the provisions of restoration under Regulation 20 is that "the appeal 'or application was heard and decided ex parte".
On behalf of the respondent it is contended by Mr. Asoke Sen that Regulation 20 only applies to cases contemplated by the latter part of Regulation 19(1) and 19(2) and not to cases of dismissal for want of prosecution under the first part of Regulation 19(1).
We are unable to accept this submission as correct.
In our opinion, the language of Regulation 20, on its true interpretation, applies not only to a case where the appeal has been decided on merits but also to a case where the appeal has been dismissed for want of prosecution under Regulation 19(1).
The reason is that in Regulation 19(1) and 19(2) the legislative authority uses the words "decide it on merits" but in Regulation 20 the expression used is "decided ex parte" and we see no reason, either in the language or context of Regulation 20, why it should not include in its scope and ambit an application for restoration of an appeal dismissed for non prosecution as also an application for restoration of appeal decided 145 on merits under Regulation 19(1).
If the view that we have taken as to the interpretation of Regulation 20 is correct, it follows that Regulation 21 applies to the present case and the period of limitation prescribed by that Regulation being 30 days from the date of receipt of the order of dismissal of the appeal, the applications of restoration made by the appellants in all the four cases were well within the period of limitation prescribed by Regulation 21.
It follows, therefore, that the Tribunal committed an error of law in dismissing the applications of restoration made by the appellants in all the four appeals.
For these reasons we allow these appeals, set aside the order of the Gujarat High Court dismissing Special Civil Applications 704 to 707 of 1961 and hold that the order of the Gujarat Revenue Tribunal dismissing the restoration applications Nos.
GRT.D. 10 to 13 of 1961 dated July 18, 1961 is defective in law and must be set aside.
We also hold that the orders of the Gujarat Revenue Tribunal dismissing Appeals Nos.
REV.A. 27.
28, 29 and 30 of 1960 are ultra vires and illegal and must be set aside and order that these four appeals should go back to the Gujarat Revenue Tribunal for being reheard and dealt with in accordance with law.
The parties will bear their own costs up to this stage.
Appeals allowed.
[/INST]The appellants had applied for compensation to the Jagir Abolition Officer under section 13 of the Bombay Merged Territories and Areas (Jagir Abolition) Act, 1953 in respect of their proprietary jagirs.
Against the orders of the said officer they preferred appeals to the Revenue Tribunal which were dismissed for non prosecution.
The appellants thereupon filed applications for restoration of the appeals within 30 days of the receipt of the orders of dismissal of the appeals.
These applications were dismissed as time barred, the Tribunal taking the view that time was to be calculated from the date of the order.
The appellants ' applications under article 227 of the Constitution to the High Court failed and they came by way of special leave, to this Court.
It was contended on behalf of the appellant that (i)the Tribunal even while deciding ex parte had to decide on merits and that (ii) the applications for restoration were filed within the time prescribed in Regulation 21 made under the Bombay Revenue Tribunal Act, 1958 which applied to the case.
HELD:(i) In the context of section 20 and ;in view of the express language of section 17(1) of the Jagirs Abolition Act the Tribunal had no power to dismiss the appeals in question for non prosecution, but it was obligatory on its part of decide the appeals on merits and to record is decision even though there was default on the part of the appellant to appear in the appeal.
[142 E F] (ii) The Tribunal also committed an error of law in dismissing as time barred the applications for restoration of the appeals made by the appellants.
In Regulation 21 made under Bombay Revenue Tribunal Act, 1958 the time prescribed for such applications is thirty days from the date of receipt of the Tribunal 's order dismissing the appeal, and the appellants had filed their applications within the said period.
[145 A, B] Regulation 21 lays down the procedure for dealing with applications for restoration made under Regulation 20 and the latter Regulation includes within its scope all appeals 'decided ex parte ' whether on merits or otherwise.
It could not therefore be said that Regulation 21 did not apply to the case.
[144 H]
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<s>[INST] Summarize the judgementAppeal No. 807 of 1963.
Appeal from the judgment and order dated September 4, 1961 of the Calcutta High Court Income tax Reference No. 85 of 1956.
C.K. Daphtary, Attorney General, R. Ganapathy Iyer and R. N. Sachthey, for the appellant.
A. V. Viswanatha Sastri and section C. Muzumdar, for the respondent.
The Judgment of the Court was delivered by Subba Rao, J.
This appeal by certificate raises the question of the construction of the provisions of section 23A of the Indian Incometax Act, 1922, hereinafter called the Act, before it was amended by the Finance Act, 1955.
The relevant and undisputed facts may be briefly stated.
Messrs. Gungadhar Banerjee & Co. (Private) Ltd., the respondent herein, is a private limited company.
At the General Body Meeting of the Company held on December 6, 1948, the Directors declared a dividend at the rate of 5 1/2 per cent.
per share.
The said distribution of dividends related to the accounting year 1947 48 which ended on April 13, 1948.
According to the balance sheet of the Company for that year the net profit for the said year was Rs. 1,28,112/7/5.
The taxation reserve was Rs. 56,000.
The profit 441 left was Rs. 72,000.
The Directors declared a dividend at the rate of 51 per cent.
per share thus making a total distribution of Rs. 44,000.
On that basis the profit that was available for further distribution was Rs. 28,000.
Though under the balance sheet the estimated tax was Rs. 66,000, the tax assessed for the year was Rs. 79,400.
If the difference between the tax assessed and the estimated tax was also deducted from the profits, there would only be a sum of Rs. 4,000 that would remain as undistributed profits.
The Income tax Officer assessed the total income of the assessee for the year 1948 49 at Rs. 2,66,766.
After deducting the tax payable under the two heads, namely, I.T. of Rs. 81,517/13/0 and C.T. of Rs. 33,345/12/0, he held that a sum of Rs. 1,51,902/7/0 was available for distribution to the shareholders as dividends.
As the amount distributed by the Company was below 60 per cent.
of the profits available for distribution, the Income tax Officer, with the previous approval of the Inspecting Assistant Commissioner of Income tax, passed an order under section 23 A of the Act directing that the amount of Rs 1,07,902 (i.e., Rs. 1,51,902 minus Rs. 44,000= Rs. 1,07,902) shall be deemed to have been distributed as dividends as on the date of the annual general meeting of the Company.
He found that, having regard to the profits earned in the earlier years and the capital and taxation reserves, payment of larger dividends would not be unreasonable.
The assessee preferred an appeal to the Appellate Assistant Commissioner against the order made by the Income tax Officer under section 23A of the Act.
By the time the appeal came to be disposed of, in an appeal against the order of assessment the assessed income was reduced by a sum of Rs. 80,926.
Notwithstanding the said deduction, as the amount of Rs. 44,000 distributed by the Company was less than 60 per cent.
of the balance of Rs. 1,64,440 arrived at on the basis of the revised calculation, the Appellate Assistant Commissioner held that an action under section 23A of the Act was justified.
He further held that the assesee incurred no losses in the previous years, that in almost all the past assessments the assessee showed substantial profits, that the profits disclosed in the year of account were not small and that, therefore, the direction to pay a higher dividend was not unreasonable.
On a further appeal, the Income tax Appellate Tribunal held that the amount of profits should be judged only from the balancesheet and that judged by the figures given thereunder a dividend to the extent of Rs. 64,000 being 60 per cent.
of the assessed profits less income tax. could be distributed and that such distribution was not unreasonable.
The Tribunal referred the following question under section 66(1) of the Act for the decision of the High Court of Calcutta: "Whether on the facts and in the circumstances of the case any larger dividend than that declared by the company could reasonably be distributed within the meaning 442 of Section 23A of the Indian Income tax Act and the application of Section 23A of the Indian Income tax Act was in accordance with law." The High Court held that the Tribunal went wrong in taking into consideration the past profits instead of the past losses, the taxation reserves without considering the past liabilities for taxation, and the profits for the year in question disclosed in the balance sheet, ignoring the actual tax assessed for that year.
It came to the conclusion that, having regard to the smallness of the profits, the order of the Income tax Officer was not justified.
In the result, it answered both parts of the question referred to it in the negative.
Hence the appeal.
Learned Attorney General, appearing for the Revenue, con tended that the balance sheet of a company on the basis of which dividends were declared was final and the profits disclosed thereunder would be the correct basis for the Income tax Officer acting under section 23A of the Act; and, as the balance sheet of the company for the relevant year showed a sum of Rs. 1,05,950 as "capital reserve brought forward", a sum of Rs. 5,73,161 as taxation reserve, and a sum of Rs. 56,000 as estimated tax, the Income tax Officer rightly held that the financial condition of the Company was sufficiently sound to warrant an order under section 23A of the Act.
Alternatively he contended that if the respondent could be permitted to go behind the balance sheet to ascertain the real profit, the Department should also be likewise allowed to go behind the balance sheet to show that the commercial profit was larger and the reserves were in excess of the past liabilities and that in that event to remand the case for ascertaining the true state of facts.
Mr. A.V. Viswanatha Sastri, appearing for the assessee Com pany, contended that the burden lies on the Revenue to establish that the dividend declared was not a reasonable one and that in the present case it had not discharged that burden.
Idle further argued that for the purpose of "testing the smallness of the profit" the Income tax Officer had to take into consideration not the assessable Income but the commercial profit of the Company and that in the present case, having regard to the commercial profit, a declaration of a higher dividend would be unreasonable.
He pleaded that, should this Court hold that the Income tax Officer could establish that the reserves were more than the liabilities, the assessee should also be permitted to prove what were its real, commercial profits and that the reserves were far less than the demands.
The contentions of learned counsel turn upon the provisions of section 23A of the Act, before it was amended by the Finance Act of 1955.
The material part of that section reads: "(1) Where the Income tax Officer is satisfied that in respect of any previous year the profits and gains distributed as dividends by any company up to the end of the 443 sixth month after its accounts for that previous year are laid before the company in general meeting are less than sixty per cent of the assessable income of the company of that previous year, as reduced by the amount of incometax and super tax payable by the company in respect thereof he shall, unless he is satisfied that having regard to losses incurred by the company in earlier years or to the smallness of the profit made, the payment of a dividend or a larger dividend than that declared would be unreasonable, make with the previous approval of the Inspecting Assistant Commissioner an order in writing that the un distributed portion of the assessable income of the company of that previous year as computed for income tax purposes and reduced by the amount of income tax and super tax payable by the company in respect thereof shall be deemed to have been distributed as dividends amongst the shareholders as at the date of the general meeting aforesaid, and thereupon the proportionate share thereof of each shareholder shall be included in the total income of such shareholder for the purpose of assessing his total income.
" The section is in three parts: the first part defines the scope of the jurisdiction of the Income tax Officer to act under section 23A of the Act; the second part provides for the exercise of the jurisdiction in the manner prescribed thereunder , and the third part provides for the assessment of the statutory dividends in the hands of the share. holders.
This section was introduced to prevent exploitation of juristic personality of a private company by the members thereof for the purpose of evading higher taxation.
To act under this, section the Income tax Officer has to be satisfied that the dividends distributed by the Company during the prescribed period are loss than the statutory percentage, i.e., 60 per cent., of the assessable income of the Company of the previous year less the amount of Income tax and super tax payable by the Company in respect thereof.
Unless there is a deficiency in the statutory percentage, the Income tax Officer has no jurisdiction to take further action thereunder.
If that condition is complied with, he shall make an order declaring that the undistributed portion of the assessable income less the said taxes shall be deemed to have been distributed as dividends amongst the shareholders.
But before doing so, a duty is cast on him to satisfy himself that, having regard to the losses incurred by the company in earlier years or "the smallness of the profit made," the payment of a dividend or a larger dividend than that declared would be reasonable.
The argument mainly centered on this part of the section.
Would the satisfaction of the Income tax Officer depend only on the two circumstances, namely, losses and smallness of profit? Can he take into consideration other relevant circumstances? What does the expression "profit" mean? Does it mean only the assessable income or does it mean commercial or 444 accounting profits? If the scope of the section is properly appreciated the answer to the said questions would be apparent.
The Incometax Officer, acting under this section, is not assessing any income to tax: that will be assessed in the hands of the shareholders.
He only does what the directors should have done.
He puts himself in the place of the directors.
Though the object of the section is to pre vent evasion of tax, the provision must be worked not from the standpoint of the tax collector but from that of a businessman.
The yardstick is that of a prudent businessman.
The reasonableness or the unreasonableness of the amount distributed as dividends is judged by business considerations, such as the previous losses, the present profits, the availability of surplus money and the reasonable requirements of the future and similar others.
He must take an overall picture of the financial position of the business.
It is neither possible nor advisable to lay down any decisive tests for the guidance of the Income tax Officer.
It depends upon the facts of each case.
The only guidance is his capacity to put himself in the position of a prudent businessman or the director of a company and his sympathetic and objective approach to the difficult problem that arises in each case.
We find it difficult to accept the argument that the Income tax Officer cannot take into consideration any circumstances other than losses and smallness of profits.
This argument ignores the expression "having regard to" that precedes the said words.
On the interpretation of the words "having regard to" in section 23A of the Act, the decision of a Division Bench of the Bombay High Court, consisting of Chagla C. J., and Tendolkar J., in Sir Kasturchand Ltd. vs Commissioner of Income tax, Bombay City(1) was relied upon by the appellant.
Chagla C.J., speaking for the Court, held in that case that "the reasonableness or unreasonableness of the payment of a dividend or a larger dividend has to be judged only with reference to the two facts mentioned in the section, viz., losses incurred by the company in earlier years and the smallness of the profit." To put the contrary construction, the learned Chief Justice said, "would be to import into it words which the Legislature did not think fit to insert in that section and to expand the ambit of the discretion exercised by the Income tax Officer." But the learned Chief of Justice did not expressly consider the scope of the expression "having regard to" found in the section.
The Judicial Committee in Commissioner of Income tax vs Williamson Diamond Ltd.(2) had to consider the scope of section 21(1) of the Tanganyika Income tax (Consolidation) Ordinance, 27 of 1950, which was pari materia with section 23A of the Act.
Adverting to the argument based upon the words "having regard to", their Lordships observed: "The form of words used no doubt lends itself to the suggestion that regard should, be paid only to the two matters mentioned, but it appears to their Lordships that it is (1) (2) 445 impossible to arrive at a conclusion as to reasonableness by considering the two matters mentioned isolated from other relevant factors.
Moreover, the statute does not say "having regard only" to losses previously incurred by the company and to the smallness of the profits made.
No answer, which can be said to be in any measure adequate, can be given to the question of "unreasonableness" by considering these two matters alone.
Their Lordships are of the opinion that the statute by the words used, while making sure that "losses and smallness of profits" are never lost sight of, requires all matters relevant to the question of unreasonableness to be considered.
Capital losses, if established, would be one of them.
" With great respect, we entirely agree with this view.
The contrary view unduly restricts the discretion of the Income tax Officer and compels him to hold a particular dividend reasonable though in fact it may be unreasonable.
The expression "smallness of profit" came under the judicial scrutiny of this Court in Commissioner of Income tax, Bombay City vs Bipinchandra Maganlal & Co. Ltd.(1) Therein, Shah, J., speaking for the Court observed thus: "Smallness of the profit in section 23A has to be adjudged in the light of commercial principles and not in the light of total receipts, actual or fictional.
This view appears to have been taken by the High Courts in India without any dissentient opinion.
" The learned, Judge laid down the following test: "Whether it would be unreasonable to distribute a larger dividend is to be judged in the light of the profits of the year in question.
" If the assessable income was the test and if the commercial profits are small, the learned Judge pointed out, the company would have to fall back either upon its reserves or upon its capital which in law it could not do.
This decision is binding on us and no further citation in this regard is called for.
These two concepts, "accounting profits" and "assessable profits", are distinct.
In arriving at the assessable profits the Income tax Officer may disallow many expenses actually incurred by the assessee; and in computing his income, he may include many items on notional basis.
But the commercial or accounting profits are the actual profits earned by an assessee calculated on commercial principles.
Therefore, the words "smallness of profit" in the section refer to actual accounting profits in comparison with the assessable profits of the year.
Another incidental question is whether for the purpose of ascertaining the net commercial profits the tax estimated or the tax actually assessed shall be deducted.
In a case where an Income tax Officer takes action under section 23A of the Act before the tax for the relevant period is assessed, only the estimated tax can be deduct (1) , 296, p(N)4SCI 446 ed but, there is no reason why, when the tax had already been assessed before he takes action under this section, the estimated tax and not the real tax shall be deducted therefrom.
In this view, in the present case to ascertain the commercial profits what should be deducted is not the tax shown in the balance sheet but the actual tax assessed, on the income of the Company.
Another question raised is whether the balance sheet is final and both the parties are precluded from questioning its correctness in any respect.
There is no provision in the Income tax Act which makes the balance sheet final for the purpose of section 23A of the Act or even for the assessment.
It no doubt affords a prima facie proof of the financial position of the company on the date when the dividend was declared.
But nothing prevents the parties in a suitable case to establish by cogent evidence that certain items were, either by mistake or by design, inflated or deflated or that there were some omissions.
It does not also preclude the assessee from proving that the estimate in regard to certain items has turned out to be wrong and placing the actual figures before the Income tax Officer.
But in this case no attempt was made before the Tribunal to canvass the correctness of the figures either on the debit side or on the credit side and we do not think we are justified to give another opportunity to either of the parties in this regard.
Before the Tribunal there was no dispute that the actual tax assessed for the relevant year was much higher than the estimated tax shown in the balance sheet.
Section 23A of the Act is in the nature of a penal provision.
In the circumstances mentioned therein the entire undistributed portion of the assessable income of the Company is deemed to be distributed as dividends.
Therefore, the Revenue has strictly to comply with the conditions laid down thereunder.
The burden, therefore, lies upon the Revenue to prove that the conditions laid down thereunder were satisfied before the order was made: see Thomas Fattorini (Lancashire) Ltd. vs Inland Revenue Commissioners(1).
In the present case the Revenue failed to discharge the said burden: indeed, the facts established stamp the order of the Income tax Officer as unreasonable.
The assessment orders passed by the Income tax Officer are not before the Court.
The balance sheet shows a net profit of Rs. 1,28,112/7/5 whereas the Income tax Officer has computed the assessable income at Rs. 2,66,766, which was later reduced in appeal by Rs. 80,925.
There is no evidence on the record that the real commercial profits were artificially reduced in the balance.
sheet.
Nor is there evidence to show what part of the income assessed represents commercial profits, and what part the notional income.
In the circumstances it must be assumed that the amount mentioned in the balance sheet correctly represented the commercial profits.
(1) L.R. [1942] A.C.643.
447 From the figures already extracted at an earlier stage it is manifest that the net commercial profit was barely Rs. 4,000 and it is not possible to hold that it was not unreasonable for the Income tax Officer to make an order to the effect that the additional sum of Rs. 64,000 should be deemed, to have been distributed as dividends amongst the shareholders.
In the result we hold that the order of the High Court is correct and dismiss the appeal with costs.
Appeal dismissed.
[/INST]As the dividend declared to be distributed by the respondentcompany at its General Body Meeting was below 60 per cent of the profits available for distribution, the Income Tax Officer, with the previous approval of the Inspecting Assistant Commissioner, passed an order under section 23 A of the Income Tax Act directing that a certain higher amount shall be deemed to have been distributed as dividends as on the date of the annual general meeting of the Company.
He found that, having regard to the profits earned in the earlier years and the capital and taxation reserves, payment of larger dividend would not be unreasonable.
This was affirmed, on assessees appeals by the Appellate Assistant Commissioner, and the Income tax Appellate Tribunal.
The Tribunal referred the question to the High Court under sec.
66(1) of the Act, which concluded that having regard to the smallness of the profits, the order of the Income tax Officer was not justified and answered the question in the assessee 's favour.
In appeal by certificate.
HELD: Section 23A of the Income tax Act is in the nature of a penal provision.
In the circumstances mentioned therein, the entire undistributed portion of the assessable income of the company is deemed to be distributed as dividends.
Therefore, the Revenue has strictly to comply with the conditions laid down thereunder.
The burden therefore, was upon the Revenue to prove that the conditions laid down thereunder were satisfied, before the order was made.
Thomas Fattorini (Lancashire) Ltd. vs Inland Revenue Commis sion applied.
In the present case the Revenue failed to discharge the said burden: indeed, the facts established stamp the order of the Income tax Officer as unreasonable. [446F, G] Though the object of the section is to prevent evasion of tax, the provision must be worked not from the stand Point of the tax collector but from that of a businessman.
The reasonableness or the unreasonableness of the amount distributed as dividends is judged by business considerations, such as the previous losses, the present profits, the availability of surplus money and the reasonable requirements of the future and similar others.
It is neither possible nor advisable to lay down any decisive tests for the guidance of the Income tax Officer.
It depends upon the facts of each case.
The only guidance is his capacity to put himself in the position of a prudent businessman.
It is difficult to say that the Income tax Officer cannot take into consideration any circumstances other than losses and smallness of profits.
This argument ignores the expression "having regard to" that precedes the said words in section 23A of the Act.
[444B E] 440 Commissioner of Income tax vs Williamson Diamond Ltd. L.R. , applied.
Sir Kasturchand Ltd. vs Commissioner of Income tax, Bombay City, , referred to.
The words "smallness of profit" in section 23A of the Act refer to actual accounting profits in comparison with the assessable profits of the year.
The two concepts "accounting profits" and "assessable profits" are distinct.
In arriving at the assessable profits the Income tax Officer may disallow many expenses actually incurred by the assessee; and in computing his income he may include many items on notional basis.
But the commercial or accounting profits are the actual profits earned by an assessee calculated on commercial principles.
[445F H.] Commissioner of Income tax, Bombay City vs Bipinchandra Maganlal and Co. Ltd. (1961)41 I.T.R. 296, followed.
In a case where an Income tax Officer takes action under section 23A of the Act before the tax for the relevant period is assessed, only the estimated tax can be deducted; but, there is no reason why, when the tax had already been assessed before he takes action under this section.
the estimated tax and not the real tax shall be deducted therefrom.
[445H 446B] There is no provision in the Income tax Act which makes the Balance Sheet final for the purpose of section 23A of the Act or even for the assessment.
It no doubt affords a prima facie proof of the financial position of the company on the date when the dividend was declared.
But nothing prevents the parties in a suitable case to establish by cogent evidence that certain items were, either by mistake or by design, inflated or deflated or that there were some omissions.
[446B D]
</s>
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<s>[INST] Summarize the judgementAppeals Nos.
303 to 307 of 1960.
Appeals by special leave from the judgment and order dated May 14, 1957, of the Madras High Court, in Case Referred No. 1 1 1 of 1953.
R. Ganapathy Iyer and G. Gopalakrishnan for the appellant.
K. N. Rajagopal Sastri and D. Gupta, for the respondent.
January 18.
The Judgment of the Court was delivered by KAPUR, J.
These appeals are brought by special leave against the judgment and order of the High Court of Madras in an Income tax reference under section 66(1) of the Indian Income tax Act, hereinafter termed the " Act".
The question referred was : " Whether the income tax assessment of the business of I Spade Clover Beedies ' belonging to the estate of the deceased and carried on during the previous years 1943 to 1946 as an association of persons for the assessment years 1944 45 to 1947 48 is valid? " And this question was decided in the affirmative and therefore against the appellants.
The facts leading to the appeals are that one Khan Sahib Mohamed Oomer Sahib, who was carrying on the business of manufacture and sale of Spade Clover brand Beedies, died on December 17, 1942, leaving a minor son Mohamed Noorullah (the appellant) by his pre deceased wife, a widow, Luthfunnissa Begum, and four children by her who were all minors at the date of the death of Oomer Sahib.
Noorullah through his next friend applied to sue in forma pauperis and during the pendency of those proceedings two Advocates of the Madras High Court were appointed joint receivers of the properties of the deceased on March 17, 1943.
This appointment was by consent of parties.
On 517 May 10, 1943, the widow, Luthfunnissa, filed a suit for partition and also applied for the continuance of the joint receivers.
Noorullah opposed this application but by an order dated May 25,1943, the receivers were ordered to be continued and they carried on the business as before.
In due course a preliminary decree for partition was passed.
The High Court has observed that none of the parties wanted to break the continuity of the business after the death of the father.
In the beginning Luthfunnissa and Dawood carried on the business and from the date of their appointment, i.e., May 17, 1943, the joint receivers continued the business till November 25, 1946, when during the course of the proceedings the business was put tip for sale by auction between the co heirs and was purchased by Noorullah.
The years of assessment are 1944 45 to 47 48, the relevant accounting years for which were the calendar years 1943 to 1946.
The profits of the business were assessed to tax in the hands of the receivers as the income of an association of persons and the contention of the appellant that the share of the profits of each of the co heirs should have been separately taxed, was rejected by the Income tax authorities as well as by the Income tax Appellate Tribunal.
The only question which was raised both before the department as well as before the Tribunal was the assessment to tax of the income of the business.
There was no dispute in regard to the income of the properties which was taxed under section 9(3) of the Act.
The business was inherited by the heirs of Oomer Sahib and was carried on without break during the accounting years first by the widow and Dawood and then jointly by the receivers.
The nature of the business was such that it could not be divided up and had to be carried on as one whole with a unity of control and all the parties desired to preserve and did preserve this unity.
The opposition by the appellant to the application for receivership filed on behalf of Luthfunnissa, the widow, was only on the ground that the appellant wanted different persons to be appointed and not to the continuance of the business or to the unity 518 of control.
The Income tax Appellate Tribunal in its order stated : " In fact, there was no change in the continuity of the business and from the date of death of Md. Oomer Sahib up to 24th March, 1943, the business was carried on by mutual agreement and consent by Luthfunnissa Begum acting on her own behalf and on behalf of her minor children and her minor step son Md. Noorullah.
There can, therefore, be no gain saying the fact that immediately after the death of Md. Oomer his estate was inherited and run by combination of individuals who had pooled their resources for the common purpose of earning income.
" And the High Court has observed The opposition was apparently to the persons to be appointed receivers and not to the continuance of the business or to the unity of control that was necessary.
Noorullah himself had realised that when he applied earlier for the appointment of receivers to conduct the business among other things.
Despite Noorullah 's opposition when Luthfunnissa asked for the continuance of receivers in her application No. 1162 of 1943, the existence of the desire of all the co sharers including Noorullah for the continuance of the business with proper persons to take charge of the business under the orders of court was clear.
That intention was material on which the departmental authorities and the Tribunal which agreed with them could find that the co sharers did constitute an 'association of persons '.
" From the finding of the Tribunal it is obvious that the business was such that it was not capable of division, it being the manufacture and sale of " Beedies " of a particular brand and the finding of the Tribunal was that the business was carried on with the consent of the parties.
On this finding it has to be decided whether the business was the business of an " association of persons.
" and its profits are assessable as such ? The contention of counsel for the appellant was (1) that on the death of Md. Oomer his estate including the business devolved upon his heirs in specific 519 shares; and (2) there was no consensus of opinion between the heirs which is shown by the fact that the appellant filed an application to sue in forma pauperis and before that application could be decided the widow sued for partition and even though receivers were appointed objection was taken by the appellant to the ' appointment of receivers.
But these facts do not assist the case of the appellant.
As has been said above, the business was in the first instance carried on by the widow and Dawood on behalf of the heirs of Oomer and subsequently when the suits were brought none of the parties wanted to break the unity of control of the business nor its continuity and it was of such a nature that it could not be carried on without such consensus and therefore the receivers carried on the business.
On these findings the High Court has rightly come to the conclusion that the business was a business of an association of persons.
This Court in Commissioner of Income tax, Bombay vs Indira Balkrishna (1) considered the question as to what an association of persons means.
The test laid down in three cases: In re B. N. Elias & Others (2); Commissioner of Income tax vs Laxmidas Devidas and Another (3) and In re Dwarkanath Harischandra Pitale (4) was accepted by this Court as correctly laying down the crucial test for determining what is an association of persons and that in each case the conclusion has to be drawn from the circumstances.
In the first case the test was laid down as applying to combinations of individuals who were engaged together in some joint enterprise but not constituting a partnership.
Such a combination of persons formed for the promotion of a joint enterprise banded together as if they were " coadventurers " it was held would constitute an asssociation of individuals.
In the second case, that is, Commissioner of Income tax vs Laxmidas Devidas and Another (3) Beaumont, C. J., at p. 589 laid down the test as follows: " In my opinion, the only limit to be imposed on the words 'other association of individuals ' is (1) ; (2) 67 (3) (4) , 520 such as naturally follows from the fact that the words appear in an Act imposing a tax on income, profits and gains, so that the association must be one which produces income, profits or gains.
It seems to me that an association of two or more persons for acquisition of property which is to be managed for the purpose of producing income, profits or gains falls within the words 'other association of individuals ' in section 3; and under section 9 of the Act, the Association of individuals is the owner of the property and as such is assessable." In that case it was also held that the fact that one of the assessees was a minor during the year of the assessment did not affect the question.
In In re Dwarkanath Harischandra Pitale (1) the assessees were two brothers who became entitled to certain house properties as tenants in common and held and managed the properties as such and derived profit therefrom.
It was held that though the assessees in the first instance did not constitute an association of individuals, they became so when they elected to retain the property and managae it as a joint venture producing income.
The test there laid down was that as soon as there was election to retain the property and manage it as a joint venture the persons so electing became an association of individuals.
The Rangoon High Court in The Commissioner of Income tax, Burma vs M. A. Baporia and Others (2) also laid down the same interpretation of the words " association of individuals ".
That was a case,, of Mohammedan co heirs and it was held that by merely inheriting a share of property no person can become a member of an association of individuals unless there is some forbearance or act upon his part to show that his intention and will accompanied the new status, that is, an association of individuals.
One of the co heirs in that case was appointed an agent to realise the income from the properties left to the co heirs by their father and mother under Mohammedan Law and that was held to be sufficient to constitute them an association of individuals.
(1) (2) 521 It is unnecessary to refer to other cases.
Taking the test as laid down by this Court in Indira Balkrishna 's case (1) it appears to us that the appellant and other co heirs were rightly assessed as an association of persons.
No doubt a suit for partition had been filed which was preceded by an application made by the appellant to sue in forma pauperis, but the suit in reality was for ensuring the proper conduct of the business and not its discontinuance.
During the period that the suit was pending and even before that, i.e., after the death of the father the business was carried on by the consent of all parties as one unit as indeed it had to be, because it had to be carried on as one unit with unity of control and therefore the co heirs did form an association of persons within the meaning of section 3 of the Act.
Counsel for the appellant relied on section C. Mazumdar,Receiver, Trigunait Brothers ' Estate vs Commissioner of Income tax (2).
That was a case of persons who formed a joint family being governed by the Mitakshara School of Hindu Law.
A suit for partition was filed and the court appointed a receiver and a preliminary decree was passed but the receiver was continued in regard to certain portion of the property and the income was assessed by the taxing authorities as the income of an association of persons.
It was held that the income from property could not be taxed as such because the shares of the parties were definite and ascertainable.
The amount paid by the lessees could not be taxed in a lump sum as being the profits of a business carried on by an association of persons and the assessment was, therefore, made in accordance with the provisions of section 9(3).
It was also held that the assessees were not carrying on a trade or business themselves and there was no association of persons as contemplated by the Act.
But that case can be of no assistance in the decision of the matter now before us.
The income to be assessed there was not income of any business carried on by or on behalf of the assessees and it was held that letting out property was not a trade or business.
With regard to the income received by the receiver (1) ; (2) 522 who employed contractors to carry on the business of coal cutting and raising it on the pit bead, it was held that that was not the income of an association of persons on the ground (1) that the receiver was in possession and he employed contractors for coalcutting and raising of coal; (2) that the assessees had no hand in the business which produced royalty and (3) that the assessees had disassociated themselves from each other because of this partition suit.
In our opinion the case so far as it relates to the carrying on of the business and in so far as it is contrary to the opinion expressed by this Court in Indira Balkrishna 's case (1), is not correctly decided.
Another case relied upon by the counsel for the appellant was Buldana District Main Cloth Importers ' Group, Khamgaon vs Commissioner of Income tax, Nagpur (2).
In that case a certain group of persons were directed to import cloth in the district and had to work a scheme for the distribution and sale of cloth which had been evolved by the District authorities.
That was held not to be an association of persons.
It appears that although they were appointed as a group of importers, all of them did not participate in that scheme during the entire period.
There were changes in the personnel of the group from time to time and there was no compulsion to work the scheme.
On these facts it was held that the group did not agree to carry on the business or share the profits.
That case must be taken to have been decided on its own facts and does not in any way affect the meaning of the phrase " association of persons.
" Counsel also relied on Khan Bahadur M. Habibur Rahman vs Commissioner of Income tax, Bihar & Orissa (3 ) in which a waqf deed was executed by which the assessee dedicated the income with ultimate benefit to the poor and constituted himself the sole mutwali of the trust.
The deed provided that the beneficiaries should be benefited concurrently and in the same proportion.
It was held that section 41(1) was inapplicable and the assessee should, therefore, be taxed on the basis of profits falling to the share of (1) ; (2) (3) 523 each beneficiary and not on the footing that all the beneficiaries constituted an association of persons.
Fazl Ali C. J. (as he then was) there observed at p. 194: " It seems to me therefore that the finding of the Tribunal that there were only 24 persons who were entitled to share the profits in the accounting year and that they were entitled to equal shares therein must be accepted.
As it does not seem to have been contended that the assessee had any other relations than those enumerated by the Tribunal who would be entitled to share the profits, it is academic to discuss whether the various categories of persons referred to by the Appellate Assistant Commissioner of Income tax were included in the term 'family ' or not." On this ground the income was not assessed as the income of an association of persons and that case " as also decided on its own facts.
The question in the present case is as to what income was to be taxed.
The income was the income of a business which was carried on as a single business by the consent of all the parties.
The mere fact that a suit was pending at the time for the administration of the estate of the deceased or for the separation of the shares of the co heirs does not affect the incidence of taxation in this case, because the business was carried on, as said above, as one business with unitary control and by the consent of the parties.
The High Court was right in holding that the income was assessable as an income of an association of persons.
The appeals must, therefore, be dismissed with costs.
One hearing fee.
Appeals dismissed.
[/INST]The business of manufacture and sale of a particular brand of beedies was carried on by 0, a Mohamedan, who died in 1942 leaving a minor son, the appellant, by his pre deceased wife, his widow L, and four children by her.
Proceedings were taken first by the appellant and later on by L in connection with the partition of the properties left by 0, including the business, and during the pendency of the proceedings the business was carried on by receivers who had been appointed by the court by consent of parties on May 17, 1943.
The receivers continued the business till November 25, 1946, when during the course of the proceedings the business was put up for sale by auction between the co heirs and was purchased by the appellant.
For the years of assessment, 1944 45 to 1947 48, for which the accounting years were 1943 to 1946, the profits of the business were assessed to income tax in the hands of the receivers as the income of an association of persons, and the claim of the appellant that the shares of the profits of each of the co heirs should have been separately taxed was rejected by the income tax authorities.
The facts showed that the business was inherited by the heirs of 0 and was carried on without break during the accounting years first by L and another and then by the receivers, that the nature of the business was such that it could not be divided up and that all the parties desired that the business should be carried on as one whole with a unity of control.
Held, that on the finding that the business was carried on by the consent of all parties as one unit with unity of control, the co heirs did form an association of persons within the meaning of section 3 of the Indian Income tax Act, 1922, and that the income of the business was assessable as the income of an association of persons ; and the mere fact that a suit was pending at the time for the administration of the estate of the deceased or for the separation of the shares of the co heirs did not affect the incidence of taxation in the case.
Commissioner of Income tax, Bombay vs Indira Balkrishna, ; , followed.
516 section C. Mazumdar, Receiver, Trigunait Brothers ' Estate vs Commissioner of Income tax, , disapproved in so far as it was contrary to the above decision of the Supreme Court.
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<s>[INST] Summarize the judgementAppeal No. 121 of 1951.
Appeal from the Judgment and Decree dated 15th December, 1948, of the High Court of Judicature at Madras (Subba Rao and Pancha,Pakesa Ayyar JJ.) in Appeal No. 474 of 1945 arising out of the Judgment and Decree dated 3 1 st July, 1945,, of the Court of the Subordinate Judge of Tenali in Original Suit No, 24 of 1944.
130 1002 M. C. Setalvad, Attorney General for India, (N. Subrahmanyam and K. R. Chowdhury, with him) for the appellants.
K. section Krishnaswamy Aiyangar (M. Seshachalapathi, with him) for the respondents.
February 26.
The Judgment of the Court was delivered by DAS J.
This appeal arises out of a suit for recovery of possession of certain immovable properties measuring about 93 acres and 33 cents which are more fully and particularly set out and described in Schedule A to the plaint.
That suit was instituted by Konduru Venkatapayya, respondent No. 1, in his capacity as the Executive Officer appointed by the Government on the 15th July, 1942, in respect of Sri Somasekharaswami Temple at Kotipalle, hamlet of Donepudi, a temple notified on the 26th October, 1939, under the provisions of Chapter VIA of the Madras Hindu Religious Endowments Act (Act 11 of 1927).
The suit was instituted in forma pauperis.
The claim for ejectment of the defendants was founded on the allegation that the properties belonged to the temple, having been given to it by an Inam grant made in 1770 A.D. by Janganna Rao, the then Zamindar of Rachur, that the defendants I to 16 and their predecessors were Archakas rendering Nitya Naivedya Deeparadhana services and as such were in possession of the properties for and on behalf of the temple and that defendants 17 to 43 were the lessees under the Archakas and that the defendants I to 16 were wrongfully claiming the properties as their own and the other defendants claimed to be in possession of portions of the properties as their lessees.
The plaintiff instituted this suit after having given registered notice to the defendants to make over possession of the suit properties to the plaintiff as the Executive Officer of the temple but the defendants were still continuing in such possession in spite of such notice.
The defendants filed written statements raising various contentions 1003 and issues to which it is not necessary now to refer.
The learned Subordinate Judge by his judgment dated the 31st July, 1945, decreed the plaintiff 's suit.
Some of the defendants preferred an appeal to the High Court but the High Court dismissed the same.
Those defendants obtained leave of the High Court to appeal to the Federal Court and that appeal has now come up for hearing before us.
The only two points which were raised before us, as before the High Court, are (1) whether the Inam grant was made in favour of the temple or whether the grant was made in favour of the Archakas burdened with the duties of service, and (2) what right did the grant confer on the grantee whether it was a grant of the land itself or only of the melvaram interest in the properties.
It is urged by the learned Attorney General that as the defendants and their predecessors have been in possession of the properties from ancient times it should be presumed that their possession originated in some lawful title conferred on them.
In short, the contention, founded on several judicial decisions, is that the principle of a lost grant should be applied in this case in favour of the Archakas who have been in quiet possession for over a century and a half.
There is no doubt, on the authorities, that a presumption of an origin in some lawful title may in certain circumstances be made to support possessory rights long and quietly enjoyed where no actual proof of title is forthcoming but it is equally well established that that presumption cannot be made where there is sufficient evidence and convincing proof of the nature of the grant and the persons to whom it was made.
It is true that the original grant is not forthcoming but turning to the evidence we find two documents which appear to us to be decisive on the question of title.
The first one is Exhibit P/3, a copy of the relevant entries in the Inam Register of 1860.
This Inam Register was prepared after enquiries made by the Inam Deputy Collector and the statements furnished at that time by the then Archakas were taken into consideration for 1004 preparing the register.
The copy of the statement filed by the then Archakas before the Inam Deputy Collector was exhibited in this case as Exhibit D/3.
In the Inam Register (exhibit P/3) under the several columns grouped under the general heading " Class extent and value of Inam " this Inam is classified in column 2 as Devadayam.
In column 3 are set out the survey numbers together with the word ' Dry ' indicating the nature of the land comprised within the survey numbers.
The areas are set out in column 5.
The heading of column 7 is " where no survey has been made and no assessment fixed by Government, the cess paid by the ryot to the Inamdar, or the average assessment of similar Government land should be entered in column (7) ".
Under this heading are set out the amounts of respective assessments against the three survey numbers totalling Rs. 198139.
We then pass on the next group of columns under the general heading " Description, tenure and documents in support of the Inam ".
Under column 8 'description of Inam 'is entered the remark " For the support of a Pagoda.
Now kept up ".
The entry in column 9 shows that the Inam was free of tax, i.e., sarvadumbala.
Under column 10 headed "Hereditary, unconditional for life only or for two or more lives " is mentioned ' Permanent '.
The name of the grantor as stated in column 1 1 is Janganna Rao and the year of grant is fasli 1179, A.D. 1770.
In column 13 the name of the temple is set out as the original grantee.
The name of the temple and the location of the temple are also set out under columns 16 and 17.
Turning now to the statement exhibit D/3 caused to be written and filed by the then Archakas during the Inam Inquiry held in 1859 60 Sree Somasekharaswami Varu is given as the name of the Inamdar and the present enjoyer.
The name of the temple is also set out under columns 3,5,6 and 12.
Under the heading " Income derived from the Inam whether it is sarvadumbala or jodi.
lf jodi the amount" in column 13 is stated " sarvadumbala Inam Cist according to the rate prevailing in the neighbouring fields Rs. 26631.
" This statement (exhibit D/3) bears 1005 the signature of the Karnams and the witnesses.
it will be noticed that neither in the Inam Register exhibit P/3 nor in the statement exhibit D/3 is there any mention of the Archakas as the grantee or for the matter of that, having any the least interest, personal or otherwise, in the subject matter of the Inam grant.
The two exhibits quite clearly indicate that the Inam grant was made in favour of the temple by the gurant or and that in the face of this definite evidence and proof of the nature of the grant, no presumption of a lost grant can be made in favour of the Archakas.
We, therefore, in agreement with the High Court, hold that the deity was the grantee and the first question raised before us must be answered against the appellants.
The learned Attorney General next contends that, assuming that the Inam grant was made in favour of the temple, it was only a grant of melvaram interest and that the Archakas who have the kudivaram rights cannot be ejected.
He relies strongly on an unreported judgment of the Madras High Court in Appeal No. 213 of 1942 (The Board of Commissioners for the Hindu Religious Endowments, Madras vs Parasaram Veeraraghavacharyulu and others) where it was held: "The records of the Inam settlement really contain only one clear indication as to the precise extent of this grant.
The statement at the Inam Inquiry, Exhibit V, upon which the decision of the Inam Commissioner was presumably based contains a column headed " Income realised from the Inam sarvadumbala " and in that column we find the entry "Rs. 14 sarvadumbala".
On its face this entry seems to show that the income of the Inam was Rs. 14 free from all charges.
We find, however, from the Inam Register, Exhibit IV, that the assessment of the Inam on the basis of the enjoyment of 16 97 acres is also Rs. 14.
This seems to indicate that the extent of the Inam was the amount of the assessment.
* * * * * It seems, therefore, that the decision must rest on the recital in Exhibit V that the income of the Inam 1006 consists of Rs. 14, read along with the recital in Exhibit TV that the assessment on the land also comes to Rs. 14.
On these materials we confirm the findings of the learned District Judge, although we do not accept his reasoning, and hold that the grant is a grant of melvaram only.
" The facts of that case appear to us to be different from those in the present case.
The Archakas in.
that case were found to have the kudivaram rights from before the Inam grant was made.
In the copies of the Inam Register and Inam Statement filed in that case the Archakas were shown as the grantees and the present enjoyers of the Inam grant and the amount shown under the heading in column 2 of the Inam register as the assessment was the same as the amount shown under column 3 of the Inam Statement under the heading "Income derived from Inam".
In the case before us the Archakas are nowhere mentioned in either Exhibit P/3 or in Exhibit D/3, there is no evidence that they had any title to kudivaram rights and finally the amount of assessment shown under column 7 of the Inam register, Exhibit P/3, is Rs. 198139, whereas the amount shown as income derived from the Inam as shown in column 13 of the Inam Statement, Exhibit D/3, is Rs. 26631.
Apart from these points of distinction the decision relied on by the learned Attorney General appears to us to be of doubtful authority.
As will appear from the passages quoted above, the decision rested mainly, if not entirely, on the fact that the amount of assessment and the amount of income were the same and the conclusion was drawn that the Inam grant comprised only of the revenue assessment, i.e., of melvaram rights.
We are unable to follow the reasoning.
Whether the Inam comprised the land itself, that is to say, both melvaram and kudivaram rights or only the melvaram rights, the entries had to be made in the Inam Register in the same form and even in the case of the grant of the land itself comprising both the rights the amount of assessment had to be set out under column 7 of the Inam Register for it is not 1007 suggested that a different form had to be used where the grant comprised both the rights.
It follows, therefore, that no inference that the Inam grant comprised only melvaram rights can be inferred from the fact that under column 7 only the amount of assessment is set out, and, therefore, the reasoning on which the decision relied on by the learned Attorney General was founded cannot be supported as correct.
Indeed, that decision has been dissented from by another Bench of the Madras High Court in Yelamanchili Venkatadri & another vs Vedantam Seshacharyulu and others (1).
In the present case the High Court was, in our opinion, clearly right in preferring the last mentioned decision to the unreported decision mentioned above.
Having regard to the different entries under the different columns in Exhibit P/3 and Exhibit D/3 there is no escape from the position that this Inam grant in favour of the temple comprised both the interests in the land.
An argument was sought to be raised by the learned Attorney General that the grantor Janganna Rao was only the Collector of the revenue and as such could not grant more than what he had got.
Reference was made to the Kistna District Manual by Gordon Mackenzie but it appeared that the person therein mentioned was not the same grantor as we are concerned with in this case and the point was not pursued and nothing further need be said about it.
Finally, the learned Attorney General submits that these Archakas who were rendering services faithfully from generation to generation from ancient times should not, in equity, be ejected from the entire lands and that they should be allowed to remain in possession of the lands and be permitted to appropriate to themselves the expenses of the services and a reasonable remuneration and the rest of the income should be made over to the temple as its property.
Reference was made to two unreported decisions of the Madras High Court in Appeal No. 218 of 1946 (1) A.I.R. 1948 Mad. 72, 1008 Dandibhotla Kutumba Sastrulu vs Kontharapu Venkatalingam, and in Appeal No. 709 of 1944, Buddu Satyanarayana vs Dasari Butchayya, Executive Officer of the Temple of Sri Malleswaraswami Varu, China Pulivaram.
In a proceeding for the framing of a scheme relating to a temple it may be permissible to take into account the claims, moral if not legal, of the Archakas and to make some provision for protecting their rights, but those considerations appear to us to be entirely out of place in a suit for ejectment on proof of title.
If the two decisions lay down, as it is contended they do, that the principles which may have a bearing on a proceeding for framing of a scheme or for enforcing the scheme that is framed may be applied to a case of the kind we have now before us it will be difficult for us to uphold them either on authority or on principle.
Further what is the conduct of the Archakas defendants appearing on the record of this case ? Although they are Archakas they actually asserted an adverse right in the face of the honest admission of their predecessors in title, made in the Inam statement Exhibit D 3.
Such conduct cannot but be regarded as disentitling them from any claim founded on equity.
The explanation put forward for the first time in paragraph 7 of their present statement of case filed in this Court explaining the absence of a claim to the property by their predecessors at the time of the Inam Inquiry namely, respect for the deity enjoined by Agama Shastra is not at all convincing.
Further, the giving of such equitable relief must depend on questions of fact, namely, the income of the property, the reasonable expenses and remuneration for the services, the amounts appropriated by them all this time and so forth which have not been investigated into in this case, because, no doubt, this question of equitable relief has been put forward as a last resort after having lost their battle.
We do not think in the circumstances of the case any indulgence should be shown to the Archakas even if it were permissible for the Court in a suit of this description to give such relief.
1009 The result, therefore, is that this appeal must fail and is accordingly dismissed with costs.
Appeal dismissed.
Agent for appellant: section Subramaniam.
Agent for respondent: M.S.K. Aiyangar.
[/INST]Though a presumption of an origin in some lawful title may in certain circumstances be made to support possessory rights long and quietly enjoyed where no actual proof of title is forthcoming, that presumption cannot be made where there is sufficient evidence and convincing proof of the nature of the grant and of the persons to whom it was made.
In the case of an inam grant, the mere fact that the amount shown in the In am Register as the assessment was the same as the amount shown in the Inam Statement under the heading "income from the inam" does not lead to an inference that the grant comprised only the melvaram rights and not the land itself.
Though in a proceeding for framing a scheme relating to a temple it may be permissible to take into account the claims, moral though not legal, of the archakas and to make some provision to protect their interest, such considerations are out of place in a suit for ejectment of the archakas on proof of title, especially when they set up an adverse title and deny the title of the temple.
[On the facts their Lordships held (i) that there was clear evidence that the inam grant in question was made by the grantor in favour of the temple and that in the face of this definite evidence as to the nature of the grant no presumption of a lost grant can be made in favour of the archakas of the temple; and (ii) that the grant was of the land itself and not of melvaram rights only.]
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<s>[INST] Summarize the judgementCivil Appeal No. 212 of 1959.
Appeal from the judgment and decree dated March 1, 1957, of the calcutta High Court in appeal from original Decree No. 71 of 1954.
G. section Pathak and Naunit Lal, for the appellants.
A. V. Viswanatha Sastri, section N. Andley, Rameshwar Nath and P. L. Vohra, for the respondent.
October 13.
The Judgment of the Court was delivered by GAJENDRAGADKAR, J.
This appeal by a certificate granted by the Calcutta High Court arises out of a suit filed by the three appellants against the respondent to recover Rs. 83,640/ .
The three appellants are respectively the Firm Radhakrishan Shivdutt Rai which carries on business at Banaras and RamKumar Lal for himself and as karta of his joint family as well as Madan Gopal for himself and as karta of his joint family, the latter two being 83 the partners in the first mentioned Firm Radhakrishna Sivadutta Rai; for convenience we will refer to the partnership firm hereafter as the appellant.
The respondent Tayeballi Dawoodbhai is a partnership firm which carries on business at Calcutta.
The appellant 's case was that the appellant and the respondent had entered into a contract in the first instance on December 18, 1980, through brokers named T. N. Mehrotra & co.
,Calcutta.
This contract was later confirmed by two letters written respectively on January 3 and 15, 1951, by the appellant to the respondent and replied to by the. respondent.
By this contract the respondent agreed to sell 1000 bales of Banaras Hemp particulars of which were set out in the plaint.
According to the appellant, by a letter written on March 14, 1951, the appellant in part performance of the said contract accepted delivery of 110 bales of Banaras Hemp No. 1 and 50 bales of Banaras Hemp No. 2; this delivery was Made by the respondent to L. N. Poddar & Co., who acted as the agent of the appellant and Paid the price of the said 160 bales.
In they transaction the respondent realised Rs. 3,840 from the said I,.
N. Poddar &; Co. in excess of the actual price of the goods delivered to the said company.
Inspite of the repeated demands made by the appellant the respondent failed to deliver the balance of the goods contracted for and thus committed breach of the contract.
That is how the appellant claimed Rs.(9,80(j as difference between the market rate on March 31, 1951, and the contract rate of the balance deliverable under the contract in suit.
This amount was claimed as damages for the breach of contract.
In addition an amount of Rs. 3,840 was claimed as having been paid in excess of tho value of 160 bales delivered to L. N. Poddar & Co., on behalf of the appellant.
This claim was resisted by the respondent on several grounds.
The principal contention urged by the respondent, however, was that in relation to 84 the contract in suit the appellant had acted as agent for its disclosed principal Messrs Khaitan and Sons Ltd., and as such it was not entitled to bring the present suit.
The respondent further alleged that the said disclosed principal Messrs. Khaitan and J. Sons had settled all their rights and loams under the suit contract with their agent and so the present claim for damages was not maintainable.
In regard to the claim for Rs. 3,840 tho respondent pleaded that the appellant 's case was untrue.
Several other pleas were also raised but with the said pleas we are not concerned in the present appeal.
Mr. Justice Bose who tried the suit framed twelve issues.
On the principal point in controversy between the parties the learned judge found that the appellant had entered into the contract with the respondent on its own account and not on account of the disclosed principal as alleged by the respondent.
According to the learned judge the reference to Messrs. Khaitan and Sons Ltd., made in the bought and sold notes on which the respondent 's plea was based had been inserted by the brokers "by mistake or due to some misconception.
" The learned judge also found that the respondent had committed a breach of the contract as alleged by the appellant.
The appellant 's case with regard to the excess payment of Rs. 3,840 made by L. N. Poddar & co. was, however, held not to have been proved.
In the result a decree was passed in favour of the appellant for Rs. 79,800 along with interest as stipulated in the decree.
Against this decree the respondent preferred an appeal; and the main point which was urged on its behalf was directed against the finding of the trial judge that the contract had been entered into by the appellant for itself and not on account of the disclosed principal.
This contention was based in the Court of Appeal, as in the trial court, on the bought and sold notes; and it was urged that 85 the bought and sold notes clearly showed that the appellant had entered into the contract on account of the disclosed principal Messrs. Khaitan and Sons Ltd.
Before the Appellate Court the respondent 's case was that the said bought and sold notes constituted the terms.
Of the contract and no other evidence was relevant and admissible in order to determine the said terms.
Das Gupta, J., upheld this.
In his opinion the bought and sold notes issued by the brokers Constituted the sole basis for the terms.
Of the contract and the two letters subsequently written on January 3 and 15, 1951, were inadmissible and irrelevant for the purpose of determining the said terms of the contract.
Tho learned judge, however, considered tho matter also on the alternative basis.
that the said letters could be considered for ascertaining the terms.
Of the contract and came to the conclusion that can reading the said letters and the bought and sold notes together the result was the same, namely, that the contract had been entered into by the appellant on behalf of the disclosed principal.
Bachawat, J., differed from Das Gupta, J., on the question about the relevance and admissibility of the two subsequent letters.
According to him the two bought and sold notes.
and the two letters between them constituted the terms of the contract.
He was inclined to take the view that the letters could not be regarded as inadmissible or irrelevant.
Reading the four documents together the learned judge.
however, agreed with the conclusion alternatively recorded by Das Gupta, J., and held that the four documents supported the respondent 's plea that the appellant had entered into the contract on behalf of the disclosed principal.
Both the learned judges agreed in holding that there was no evidence to support the appellants plea that the reference to the principal made in the bought and sold notes was a result of any mistake.
On these findings the decree passed by the trial court was reversed and the appellant 's suit Was ordered to be dismissed.
86 In regard to the costs, however, the Appellante Could took the view that the point raised before the Appellate Court about the effect of the bought and field notes had not been specifically mooted before the trial court and that several other pleas raised by the respondent were found by the trial court to be false and so the proper older as to costs would be that each party should bear its costs throughout.
After this judgement was delivered the appellant applied for and obtained a certificate from the High Court and it is with the said certificate that the present appeal has been brought before this Court.
On its behalf Mr. Pathak has strenuously contended that the Appellate Court was in error in coming to the conclusion that the contracts in suit had been entered into by the appellant on behalf of the disclosed principal Messrs. Khaitan & Sons Ltd., Banaras.
For the purpose of deciding this point we propose to assume in favour of the appellant that the terms of the contract may be gathered from the two bought and sold notes on which the respondent relies as well as the two subsequent letters on which the appellant relies.
It would be convenient at this stage to set out the said documents.
We will first refer to the brokers ' notes and the confirmation slips in respect thereon.
This is how the brokers ' notes read: "T. N. Mehrotra and Co. No. 377 Hemp, Oil and Oil Seedh Pollock House Brokers.
(3rd Floor) 28 A, Pollock Street.
Any dispute in connection with this deal is subject to Arbitration by Bengal Chamber of Commerce.
Calcutta, 18 12 1950.
87 Radhakrishna Sivadutta Rai, A/c Khetan and Sons Ltd., Shewpur, Banaras.
Dear Sirs, We confirm having purchased on your account and risk under noted goods from Messrs. Tayeballi Dawoodbhai, 20, Zakaria Street, Calcutta.
Commodity: 500 (five hundred) bales of Banaras No. 1 only with Agmark Jan/March '51 at K. P. Docks @ Rs. 165 per bale of 400 lbs.
each on receipt of the goods.
Yours faithfully, For T. N. Mehrotra and Company, Sd.
T. N. Mehrotra.
Sales Tax number should be furnished by the Buyers otherwise to be charged." "T. N. Mehrotra and Co. No. 378 Hemp, oil and oil Seeds Pollock House Brokers (3rd Floor) Bank 4718 29 A Pollock street Tel: B.K. 1914 Calcutta, 18 12 50.
Any dispute in connection with this deal is subject to arbitration by Bengal Chamber of Commerce.
To: M/s. Tayeballi Dawoodbhai, 20, Zakaria Street, Calcutta.
Dear Sirs, We confirm having sold on your account and risk, the under noted goods, to M/s. Radakrishan Shiv Dutt Rai with A. G. Mark.
A/c Khetan and Sons Ltd., Shewpur, Banaras.
Commodity: (500) Five hundred Bales of Banaras No. 1 only with A. G. Mark.
88 Delivery: Jan./March 1951 at K. P. Dock.
Price: @ Rs. 165 per bale of 400 Ibs.
Terms of Payment on receipt of goods.
Brokerage 0 8 O per bale.
Sales Tax number should be finished by the buyer otherwise to be charged.
Yours faithfully, For T. N. Mehrotra & Co., Sd.
T. N. Mehrotra "To M/s. T. N. Mehrotra & Co., Calcutta.
We acknowledge receipt of your purchase confirmation memo No. 377 dated 18 12 50.
Signature: Gopal Lal Gupta For Radhakrishna Shivadutta Rai." "To M/s. T. N. Mehrotra & Co., Calcutta.
We acknowledge receipt of your purchase confirmation memo.
No. 378 dated 18 12 50.
Signature: Gopal Lal Gupta For Radhakrishna Sivadutt Rai".
The said confirmation slips were signed by Gopal Lal Gupta for the firm of Radhakrishna Shivdutt Rai.
" After the said notes were sent by the brokers to the respective parties Gopal Lal Gupta on behalf of the appellant wrote a letter to the respondent on January 3, 1951, and on January 15.
1951 the respondent wrote a letter to the appellant.
These letters read at follows: "Messrs. Tayeballi Dawoodbhai, 3 1 51. 20, Zakaria Street, Calcutta.
Dear sirs, We have boughS from you one thousand bales of Banaras Hemp through Messrs. T. N. Mehrotra & Co., 28 A, Pollock Street, Calcutta, on the following terms: 89 1. 500 (Five hundred) bales Banaras No. 1 with agmark @ Rs. 166 (one hundred and sixtyfive) per bale of about 400 lbs.
delivery K. P. Docks during January/March 1951.
2. 500 (Five hundred) bales Banaras No. II with agmark @ Rs. 145 (one hundred and fortyfive) per bale of about 400 lbs.
delivery E. P. Docks during January/March 1951.
Please note and confirm.
Yours faithfully, for Radhakrishna Shivdutt Rai Sd.
Gopal Lal Gupta." "Tayoballi Dawoodbhai 20, Zakaria Street, Registered.
Calcutta 1.
Calcutta, 15th January, 1951.
Messrs. Radhakrishna Shivadutt Rai, Banaras.
Dear Sirs, We confirm having sold to you through Messrs. T. N. Mehrotra & Co., Calcutta, 1000 (one thousand) bales of Banaras Hemp as follows: (i) 500 (Five hundred) bales Banaras Hemp No. I with Agmark at Rs. 165 per bale of about 400 Ibs.
delivery K. P. Docks during January/March 1951.
(ii) 500 (Five hundred) bales Banaras Hemp No. II with Agmark at Rs. 145 per bale of about 400 lbs.
K. P. Docks delivery during January/March 1951.
This confirms your letter of 3rd instant.
Yours faithfully, for Tayeballi Dawoodbhai.
x x Partner.
Copy to Messrs. T. N. Mehrotra & Co., Calcutta, and to Gopinath Mehrotra, Banaras." Mr. Pathak contends that in construing the effect of the relevant documents we should not 90 attach any importance to the reference to Khaitan & Sons made in the bought and sold notes for the simple reason that the said reference is the result of a mistake or misconception on the part of the brokers.
In that connection he contended that the J. finding recorded by the trial court on the issue of mistake should be accepted by us and not the finding made by the/ Appellate court.
We are not impressed by this argument.
In regard to these notes we have the evidence of Trilokinath and Gopinath on behalf of the brokers which negatives the theory of mistake or misconception.
Trilokinath has stated on oath that when he got the offer from the respondent he telephoned to his brother Gopinath who is a broker in respect of hemp of the firm of Sewnath Gopinath and he told him about the offer.
Gopinath then informed Trilokinath that the offer was closed either on the 16th or on the morning of the 17th.
This information was received by Trilokinath from Gopinath on the telephone.
Trilokinath was then asked about the information that his brother gave him, and he stated that his brother told him that the offer which he had communicated to him in respect of 1000 bales at Rs. 165 and.
Rs. 145 had been sold by him to Khaitan Sons & Co., Fibre Ltd. He also added that he received another message from his brother either on the 18th or on the night of the 17th to prepare a contract so that it will be Khaitan & Sons through the appellant; Thus, it is clear that the evidence of Trilokinath, if believed, clearly shows that there could be no mistake or misappreciation on the part of the brokers, when the notes referred to Khaitan & Sons as principal in respect of the transaction.
Gopinath substantially corroborated the evidence given by Trilokinath.
He stated that when he got the offer from his brother Trilokinath he went to Deokinandan who was working for Khaitan & Sons and it was after discussion with Deokinandan thatthe souda was closed as one on behalf of Khaitan & Sons.
Having thus closed this 91 contract with Deokinandan, who represented the principal Khaitan & Sons, Gopinath told Trilokinath to close the offer and asked him to prepare the note showing that the appellant was acting as agent for the disclosed principal Khaitan & Sons.
Reading the evidence of the two brothers who worked as brokers in respect of the transaction in suit it is clear that any possibility of a mistake or misappreciation is wholly excluded.
On behalf of the appellant Gopal Lal Gupta has given evidence.
He attempted to explain away the fact that he did not protest against, or object to, the insertion of the name of Khaitan & Sons in the notes by suggesting that when he signed the confirmation slips after receiving the notes he had not noticed the reference to Khaitan & Sons.
His case was that the purchase had been made by the appellant for itself and not for any other firm, and the suggestion he made was that if he had noticed that the notes had made reference to Khaitan & Sons he would either have insisted upon the said name being delete(l or would not have concluded the contract; but when his statement that he did not notice the reference to Khaitan & Sons was tested in cross examination Gopal Lal was shaken, and he had to admit that when he signed the confirmation slip he may have noticed the reference to Khaitan & Sons but he did not read the document attentively.
He was, however, forced to concede that he had gone through the note before he signed the confirmation slip.
It was under stress of cross examination that Gopal Lal incidentally mentioned that the reference to Khaitan & Sons may have been made by mistake.
It is obvious that Gopal Lal 's evidence which otherwiee suffers from the infirmity that it is full of contradictions cannot be accepted on the question of mistake because his explanation about his conduct in signing the confirmation slips considered by itself is wholly unsatisfactory.
Therefore, in our opinion, the Appellate Court was fully justified in 92 reversing the finding of the trial court on this point and in coming to the conclusion that the reference to Khaitan & Sons which the notes made was no the result of any mistake or misconception In this connection it may be relevant to refer to the attitude adopted by the appellant when the dispute arising between the parties in the present contract had gone before the Bengal Chamber of Commerce for adjudication.
In those proceedings the respondent had raised the same plea that it has raised in the present suit.
It was urged on its behalf that the appellant was not entitled to make ally claim on the contract because it had entered into the contract on behalf of a disclosed principal and on its account.
Apparently that plea appears to have been accepted and the arbitration proceedings therefore ended as being without jurisdiction.
In meeting the plea raised by the respondent it is significant that the appellant thought it fit to urge that the respondent 's allegation that the appellant was the agent of one Khaitan & Co. was not correct and that there is no firm or company known as Khaitan & Co. Or Khaitan & Sons, Ltd., or Khaitan & Sons in Shewpur, Banaras.
The appellant therefore pleaded that the jurisdiction of the Chamber to entertain the case could not be disputed on that score.
The appellant also alleged that the reference to Khaitan &; Sons was superfluous and no importance should be attached to the said words.
In the suit itself a faint attempt was no doubt made to challenge the identity of the firm Khaitan Sc Sons, but Mr. Pathak has very fairly not attempted to raise that point before us.
It would thus be noticed that the principal point made by the appellant in the arbitration proceedings before the Chamber in respect of the reference to Khaitan & Sons in the notes was entirely frivolous; no case of mistake appears to have been set out at that state.
Besides, as we have already pointed out, there is no evidence on which a finding of mistake can be reasonably made in favour of the appellant.
Therefore, we 93 must proceed to consider the question about the construction of the relevant documents on the basis that the reference to Khaitan & Sons which the notes make is not the result of any mistake and has been made in the ordinary course of businesss by the brokers.
Let us then consider what the effect of the bought and sold notes is according to the established custom in the mercantile world.
Mr. Viswanatha Sastri, for the respondent, contends that, according to the established commercial usage, if there is no variation or disparity in the bought and sold notes, the bought and sold notes issued by the brokers constitute the terms of the contract between the parties for whom the brokers act.
We are inclined to accept this contention.
The effect of such notes issued by the brokers has been frequently considered by judicial decisions.
As early as 1846 the Privy council had occasion to deal with this question in Cowie vs Remfry (1).
In that case a. C & Co and H.& Co; were merchants at Calcutta.
The latter sold to the former a large quantity of indigo through the medium of a broker who drew up a sold note addressed to H.& Co. and submitted.
it to H. for his approval.
H. Objected to a particular word appearing in the note whereupon the broker took the sold note to C. and informed him of His objection.
C. then struck his pen through the word objected to by H. placed his initials over the erasure and returned the note to the broker.
The broker then delivered it in that altered form to H. & Co. Next day the broker delivered to C. & Co. a bought note which differed in certain material terms from the sold note.
In an action brought by H. & Co. against C. & Co. for the breach of the contract as contained in the sold note the Supreme Court at Calcutta was of the opinion that the sold note alone formed the contract and so it decreed the plaintiff 's suit.
On appeal by the defendant the Privy Council reversed (1) (1846) 3 M.I.A.448 94 the finding of the Supreme Court and held that the transaction was one of bought and sold notes and Rai held that the circumstances attending C. 's alteration of the sold note and affixing his initials were not sufficient to make that note alone a binding contract.
According to the Privy Council, there being a material variation in the terms of the bought with the sold note they together did not constitute a binding contract.
It would thus be seen that the Judicial Committee was dealing with a case where the bought and sold notes did not tally and so the decision was that where the bought and sold notes do not tally the sold note alone cannot constitute the terms of the contract.
In dealing with this question, however, their Lordships referred to the mercantile custom in regard to the bought and sold notes and observed that "the established usage of dealing in the mercantile world should be held in high respect; the very existence of such usage shows that in practice it has been found useful and beneficial; the presumption is in its favour, and no departure from it is to be inferred from doubtful circumstances".
That is why the Privy Council reached the conclusion that "this must be considered as a transaction in the contemplation of the parties by bought and sold notes, and that, the contract is contained in both of the notes, and not in one;" inevitably there being a material variation between the two notes "the consequence follows, from all legal principles, that no binding contract has been effected".
This decision shows that the mercantile usage of entering into contracts evidenced by the bought and sold notes issued by the brokers was treated by the Privy Council as well recognised.
The next decision to which reference may be usefully made is the case of Sievewright vs Archibald(l).
In that case again there was a variation in the bought and sold notes and the variation was material, and so it was held that there was no (1) ; , 1228, 1229.
95 sufficient memorandum of a contract to satisfy the Statute of Frauds.
In dealing with the question raised for the decision of the Court Lord Campbell, C. J., has made certain general observations which throw considerable light on the genesis of the bought and sold notes and the effect which is ually attributed to the said notes by commercial usage.
"If the bought note case be considered a memorandum of the parol agreement", observed Lord Campbell, C. J., "so may the sold note; and which of them is to prevail ? It seems to me, therefore, that we get back to the same point at which we were when the variance was first objected, and the declaration was amended.
I by no means say that where there are bought and sold notes they must necessarily be the only evidence of the contract; circumstances may be imagined in which they might be used as a memorandum of a parol agreement.
Where there has been an entry of the contract by the broker in his book signed by him, I should hold without hesitation, notwithstanding some dicta, and a supposed ruling of Lord Tenterden in Thornton vs Meux (M. & M. 43), to the contrary, that this entry is the binding contract between tho parties and that a mistake made by him, when sending them a copy of it in the shape of a bought or sold note, would not affect its validity.
Being authorised by the one to sel], and the other to buy, in the terms of the contract, when he has reduced it into writing and signed it as their common agent, it binds them both, according to the Statute of Frauds, as if both had signed it with their own hands; the duty of the broker requires him to do so; and till recent times, this duty was scrupulously performed by every broker.
What are called the bought and sold notes were sent by him to his principals by way of information that he had acted upon their instructions, but not as the actual contract which was to be binding upon them.
This; clearly appears from the practice still followed of sending the bought note to the buyer, and the sold 96 note to the seller; whereas, if these notes had been meant to constitute the contract, the bought note would be put into the hands of the seller, and the sold note into the hands of the buyer, that each might have the engagement of the other party J, and not his own.
But the broker, to save himself trouble, now omits to enter and sign any contract in his book, and still sends the bought and sold notes as before.
If these agree, they are held the constitute a binding contrat; if there be any material variance between them, they are both nullities, and there is no binding contract.
This last proposition, though combated by the plaintiff 's counsel, has been laid down and acted upon in such a long series of oases that I could not venture to contravene it, if I did not assent to it; but, where there is no evidence of the contract unless by the bought and sold notes sent by the broker to the parties, I do not see how there can be a binding contract unless they substantially agree; for contracting parties must consent to the same terms; and where the terms in the two notes differ there can be no reason why faith should be given to the one more than the other".
These observations seem to establish two propositions, first that if the bought and sold notes show a material variation neither of them nor both of them taken together can be re.
lied upon for the purpose of proving the terms of the contract, and second if the bought and sold notes agree they are held to constitute a binding contract.
To the same effect is the observation made by the Privy Council in Ah Shain Shoke vs Moothia Chetty,(l) when Sir Richard Couch observed that "Moothia Chetty, one of the respondents, said in his evidence he did not consider the contract as concluded until bought and sold notes were signed.
He was right in this.
They were the only evidence of the contract.
" It is in the light of this legal position that we must consider the effect of the bought and sold (1) (1899) L. R. 27 I.A. 30 97 notes in the present case.
The notes referred to the appellant and added "A/C Khaitan & Sons Ltd." There is no disparity in the notes at all; and so the two notes can be safely taken to evidence the terms of the contract.
When along with the name of the appellant the notes specifically refer to a "Khaitan & Sons Ltd." with the preceding words "A/c ' ', there can be no doubt that the appellant is shown by the notes to be acting on account of the disclosed principal.
The appellant realised that the effect of the reference to Khaitan & Sons in the notes would inevitably be to support the plea of the respondent that it was not entitled to bring the present action and so it pleaded that the said reference was the result of a mistake.
Therefore, there can be no doubt that if the material question had to be considered in the light of the bought and sold notes alone the appellant was acting on behalf of the disclosed principal and, on the contract thus entered into, it had no right to sue end can claim no cause of action in its favour.
In Gadd vs Houghton (1), James, L. J. Observed "when a man says that he is making a contract 'on account of ' some one else, it seems to me that he uses the very strongest terms the English language affords to show that he is not binding himself, but is binding his principal".
In that case fruit brokers in Liverpool gave a fruit merchant a sold note which read thus: "We have this day sold to you on account of James Morand &; Co., Valentia, 2000 cases Valentia, oranges, of the brand James Morand & Co., at 12s.
per case free on board", and the brokers signed the note without any addition.
The purchaser brought an action against the broker for non delivery of the oranges.
It was held that the words "on account of James Morand & Co." showed the intention to make the foreign principals and not the brokers liable and that the brokers were not liable upon the contract.
It would be noticed that (1)(1876) 98 in dealing with the question about the brokers liability two points fell to be Gonsidered.
The first point in support of fixing the liability with the brokers was that the brokers had signed this note without describing themselves as acting for the disclosed principals; and the argument was that "when a man signs a contract in his name he is prima facie a contracting party and liable and there must be something very strong on the face of the instrument to show that the liability does not attach to him".
This principle was accepted by the learned judge who decided the case; but it was pointed out that there was another fact which had an overriding effect and that was that the note showed that the brokers were acting for the diclosed principal, and that fact clearly repelled the brokers ' liability in regard to the contract.
In dealing with the argument about the effect of the signature Mellish, L. J. Observed "when the signature comes at the end you apply it to everything which occurs throughout the contract.
If all that appears is that the agent has been making a contract on behalf of some other person, it seems to me to follow of necessity that that other person is the person liable.
This is one of the simplest possible case.
How can the words 'on account of Morand & Co. '. be inserted merely as a description ? The words mean that Morand & Co. are the people who have sold.
It follows that the persons who have signed are merely the brokers and are not liable".
We have referred to there observations made by Mellish, L. J., because as we will presently point out they would be of material assistance in deciding the point which Mr. Pathak has raised on the strength of the two subsequent letters.
Thus, the bought and sold notes in this case unambiguously indicate that the appellant was acting for a disclosed principal and the contracting party was the disclosed principal and no other.
It is, however, urged by Mr. Pathak that before determining the terms of the contract and the 99 parties to it we must read the notes in question along with the two letters.
We have already seen the sequence of the documents.
First, the notes were delivered by the brokers to the appellant and the respondent.
Then the respective parties filed confirmation slips and then followed the two letters exchanged between them.
Mr. Pathak contends that in its letter addressed to the respondent the apellant has definitely stated that 'they ' had bought from the respondent 1000 bales in question.
Mr. Pathak places considerable emphasis on the use of the word "we" without reference to the principal; and he also relies on the fact that the letter is signed by the appellant without describing itself as acting on behalf of the principal already disclosed.
Similarly he relies on the statement of the respondent 's letter to the appellant that the respondent had sold to the appellant "to you" the bales in question.
According to Mr. Pathak the significance of these letters should not be underestimated in determining the parties to the contrat.
There is no doubt, and indeed it is a matter of common ground before us, that the letters do not constitute all the terms of the contract, and all that is urged by Mr. Pathak is that they should be consider along with the notes.
The notes refer to the fact that if any dispute arises in the deal it is subject to the arbitration by the Bengal Chamber of Commerce.
They also refer to the sales tax number which is to be furnished by the buyers, otherwise they would be charged.
These terms undoubtedly constitute terms of the contract; but the argument is that in the correspondence which took place between the parties there is no reference to the principal and indeed the correspondence proceeds on the basis that the appellant acts for itself and not for a disclosed principal, and that Should be borne in mind in deciding whether the appellant was acting for tho disclosed principal or not.
100 In support of his argument that the signature of the appellant to its letter of January 3, 1951, and the use of the word "we" in the first paragraph of he letter indicate that the appellant was acting for hi itself.
Mr. Pathak relies on a decision of the King 'section Bench Division in H. O. Brandt & Co. vs H.N. Morris o. Ltd. (1).
In that case the plaintiffs who carried on business in Manchester gave to the defendants a bought note dated September 3, 1914.
This note was addressed to the defendants and was headed From Messrs. H.O. Brandt & Co., 63 Granby Row Manchester, For and on behalf of Messrs. Sayles Bleacheries, Salesville, Rhode, Island, U. section A.".
The note stated "we have this day bought from you 60 tone pure an line oil" and it was signed "H. O. Brandt & Co.".
The plaintiffs sued for non delivery of the oil.
Their claim was resisted on the ground that they had entered into the contract on behalf of a disclosed principal and therefore were not entitled to be sued.
It was held by Viscount Reading, C. J., and Scranton, L. J., Neville, J., dissenting, that the plaintiffs were the contracting parties and were entitled to sue upon the contract.
The majority decision was based on three grounds.
The first ground was that the plaintiffs had signed the note without describing themselves as acting on behalf of the principal and so it was held following the language used by Mellish, L. J., in the case of Gadd (2) that prima facie when a man signs a document in his own name and states therein "I have this day bought from you" he is the person liable on the contract.
The second consideration was that the reference to the foreign principal was made in the note in order to declare the destination of the goods.
There wax evidence adduced in the case to show that during wartime the destination of goods intended for export had to be made known.
Therefore the reference to the foreign principal was treated as having been made for the purpose of meeting the said (1) (2) (1876)1 exhibit D. 357.
101 requirement; and the third circumstance was that the plaintiff 's statement at the head of the note that they were acting for and on behalf of a foreign principal could not get rid of the prima facie presumption that a person signing a contract in his own name is personally liable on it.
It would thus be seen that the rule of construction which prescribes that if a person signs a contract prima facie he is the contracting party prevailed in that case because the reference to the disclosed principal was otherwise explained as serving another purpose altogether.
The said rule of construction prevailed also for the additional reason that the plaintiffs were acting for a foreign principal.
It would be remembered that 8. 230 of the Indian Contract Act provides that in the absence of any contract to that effect, an agent cannot personally enforce contracts entered into by him on behalf of his principal, nor is he personally bound by them.
There are, however, three cases specified in the section where such a contract would be presumed to exist; one of these cases is where a contract is made by an agent for sale or purchase of goods for a merchant resident abroad.
In other words, under section 230 if an agent enters into a contract for a disclosed foreign principal the main provision of section 230 will not apply because there would be a presumption that there is a contract to the contrary under which the agent would be personally bound by the contract notwithstanding the fact that he has entered into it on behalf of a foreign principal.
Therefore, we are not prepared to hold that the decision in the case of H. C. Brandt & Co. (1) lays down an unqualified rule of construction on which the appellant can rely.
In fact, it may be pointed out that Neville, J., who dissented from the majority view, has significantly observed that "I rather gaudier that I should not have found myself in isolation on this point were it not for the fact that during the war there is an obligation to disclose the destination (1) [1917] 2 K.B.784.
102 of the goods".
this observation shows that reference to the disclosed principal was not given its full effect in considering the question about the liability of the agent because it was held by the majority decision that the said reference was primarily, if not exclusively, made for the purposes of disclosing the destination of the goods.
In support of his argument that the relevant recitals in the two letters show that the contract had been entered into by the appellant on its own behalf Mr. Pathak has also referred us to the statement of the law made by Bowstead on "Agency".
"The question whether the agent is to be deemed to have contracted personally," it is observed, "in the ease of contract in writing other than a bill of exchange, promissory note, or cheque, depends upon the intention of the parties, as appearing from the terms of the written agreement as a whole, the construction whereof is a matter of a law for the Court (a) if the contract be signed by the agent in his own name without qualification, he is deemed to have contracted personally, unless a contrary intention plainly appear from other portions of the document, (b) if the agent add words to his signature, indicating that he signs as an agent, or for or on behalf of a principal, he is deemed not to have contracted personally, unless it plainly appears from other portions of the document, that, notwithstanding such qualified signature, he intended to bind himself.
" In conclusion it is added that "effect should be given to every word used and none should be rejected unless it is apparent that they have been introduce per incuriam" (P. 266, article 116).
These observations do not carry the appellant 's case very for because all that they show is that in determining the question as to whether the agent has entered into the contract on behalf of the principal or not the way he has signed the document has to be considered along with the other recitals made in the relevant documents.
103 What then would be the effect of the relevant recitals in the letter on which Mr. Pathak relies? In this connection it is necessary to recall that we are reading these letters along with the bought and sold notes, and that the bought and sold notes have unequivocally and clearly indicated that the appellant was acting on behalf and on account of the disclosed principal Khaitan & Sons.
If we read the letters in the light of the bought and sold notes it would be clear that the signature of the appellant will not have much significance, nor would the use of the word "we" by the appellant or "you" by the respondent make any difference.
Parties knew that the appellant was acting on behalf of the disclosed principal.
It is not suggested that in such a case every time the agent has to sign expressly stating that he is acting on behalf of the disclosed principal.
Therefore, if the appellant was acting for the disclosed principal the fact that he did not add the relevant description to his signature, or used the word "we" in the operative portion of the letter would not materially alter the fact spoken to by the notes that the appellant was acting on behalf of the disclosed principal.
It cannot be suggested that these letters intended to alter the position disclosed by the notes.
The letters, like the confirmation slips, are and must be, presumed to be consistent with the notes; and so it would be unreasonable to attach undue importance to the signature and to the use of the relevant words "we" and "you" on which reliance has been placed.
In our opinion, therefore, the appellate Court was right in holding that even if the bought and sold notes are read along with the confirmation slips and the two letters of January 3, 1961, and January 15, 1951, the conclusion is inescapable that the appellant entered into the contract on behalf of the disclosed principal Khaitan & Sons Ltd. If that be so, it follows as a matter of law that the appellant is not entitled to bring the present suit.
104 Mr. Pathak faintly attempted to argue in the alternative that even if the appellant was acting on behalf of the disclosed principal it would be entitled to sue because from the subsequent conduct of the parties a contract to the contrary could be reasonably inferred.
We have, however, not allowed Mr. Pathak to argue this point.
It was conceded by the appellant before the Appellate Court that if it was held that the plaintiff firm was acting as agent for Khaitan & Sons Ltd., the suit was not maintainable.
This concession was made in view of the provisions of section 236 of the Contract Act.
Besides, the alternative plea which Mr. Pathak wanted to raise does not appear to have been expressly pleaded or considered in the trial court.
In the result the appeal fails and is dismmissed.
In the circumstances of this case we direct that the parties should bear their own costs in this Court.
[/INST]Permanency of tenure does not necessarily imply both fixity of rent and fixity of occupation and the fact of enhancement of rent does not necessarily militate against the tenancy being a permanent one.
When, therefore, in a previous suit the only question was whether the jama could be increased and the jama was increased: Held, that this decision did not operate as res judicata on the question of permanency of the tenure in a subsequent suit for ejectment.
Shankar Rao vs Sambhu Wallad ; Jogendra Krishna Banerji vs Subashini Dassi , Probhas Chandra Mallick vs Debendra Nath Das (1939) 43 C.W.N.828, relied on.
Mere possession for generations at a uniform rent, or construction of permanent structures by itself may not be conclusive proof of a permanent right but the cumulative affect of such facts coupled with other facts may lead to the inference of a permanent 931 tenancy Where it was not known how the earliest known tenant acquired the tenancy or what the nature of the tenancy was, the tenancy bad passed from one person to another by inheritance or by will or by transfer inter vivos, in the deeds of transfer the transferee was given the right to enjoy from generation to generation for ever, pucka structures and tanks had been constructed, and though there was an enhancement of rent in 1860, the rent bad not been increased since then: Held, that all these circumstances put together irresistibly led to the conclusion of a permanency of the tenure.
Probhas Chandra Mallik vs Debendra Nath Das (1939) 43 O.W.N. 828 referred to.
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<s>[INST] Summarize the judgementN: Criminal Appeal No. 313 of 1978.
Appeal by Special Leave from the Judgment and Order dated 22 3 78 of the Punjab and Haryana High Court in Criminal Appeal No. 189/75.
A. section Sohal and section K. Jain for the Appellant.
Hardev Singh for the Respondent.
The Judgment of the Court was delivered by KRISHNA IYER, J.
Every litigative appeal has a docket number but beneath the paper lurks a human factor, often forgotten in the forensic pugilists but now and then brought to the fore, as in this criminal appeal limited to the issue of appropriate sentence.
Surely, 'the law must keep its promises. ' Justice Holmes expressed the obvious when he said this, but the breach of promise by the law on delivering criminal justice is daily experience, from police arrest to prison trauma.
The focus in this case is on the sentencing alternatives in the Criminal Procedure Code; and the grievance pressed by counsel, when traditional grounds on the merits failed, was that the compassion of section 360 professionally suffering benign neglect, be kindled and he be released.
Enacted law is guilty of inaction, because its obscure presence on the statute book escapes the vigilance of the Bar.
Where even the court ignores what is vital to the little man the guarantee of 1136 sentencing legality becomes a casualty.
This case is an instance in point.
Now the brief story which enlivens the 'sentencing ' submissions.
Four villagers of rural Punjab, of whom the appellant is one, set upon Arjan Singh, a small official, while on his way back home.
The sound and fury of the attack with sticks brought out the ill starred, innocent Srimati Rakhi, Arjan Singh 's brother 's wife.
Her daughter too came to the spot attracted by the fracas.
Arjan Singh received blows, being the angry target of the assailants.
But poor Rakhi, who came in accidentally, was hit on the head with a takua by Jagir Singh, one of the accused.
She eventually died; and her daughter and Arjan Singh were hurt by the beating.
Four persons were charged by the police with offences under section 302, 324 and 323 I.P.C. including constructive liability under section 34.
Two of them were acquitted by the trial court and the other two were convicted but appealed to the High Court.
The man who dealt the fatal cut was Jagir Singh.
His conviction under section 302 I.P.C. and award of life imprisonment by the Sessions Court was converted into one under section 304 Part 1, I.P.C. with a consequential reduction of sentence to seven years ' rigorous imprisonment.
His conviction on certain other counts was maintained but we are not concerned with him at all, since the appellant in this Court is the other accused Dilbag Singh.
His role was lesser and related to causing simple injury to Arjan Singh for which he was sentenced to rigorous imprisonment for one year and a fine of Rs. 200/ .
He was held vicariously guilty under sections 324/34 I.P.C. and awarded two years ' rigorous imprisonment and a fine of Rs. 1000/ .
In addition he was convicted under section 323 I.P.C. for causing hurt to the daughter of the deceased and on this count punished with R.I. for one year together with a fine of Rs. 200/ .
Having declined leave on the question of guilt, we confine our attention to the contentions on the sentence.
We proceed on the footing of the facts found and ask ourselves whether any basic flaw in sentencing technology affords appellate intervention and re designing of reformatory treatment in the conspectus of circumstances present in the case.
The courts in our country consult the punitive tariffs prescribed in the Penal Code, consult the prison period awarded in practice for such offences and with marginal variations mechanise the process.
Judged by that test, conviction under section 324 I.P.C. read with section 34 plus substantive guilt under section 323 I.P.C. is visited with two years for the former and one year R.I. especially when the incident has ended in death.
But penal humanitarianism, strategies of non institutional rehabilitation and 1137 a complex of other considerations in making an offender a non offender have revolutionized the judicial repertory in re socializing the criminal.
The sentence hearing for which the Criminal Procedure Code, 1973 provides in section 248(2) and section 235(2) has hardly received the serious concern of the Courts despite the International Probation Year and therapeutic accent in penological literature. 'If the criminal law as a whole is the Cinderella of jurisprudence, then the law of sentencing is Cinderella 's illegitimate baby '.
Pre sentence investigation reports, bestowal of intelligent care on the choice between institutional and non institutional disposition and habitual neglect of new avenues open to the court have constrained us to grant leave in the case so that guidelines may be laid down and probation and community oriented methods lying in the legal limbs may be re activated.
Our prisons are overcrowded, our prisoners are subjected to iatrogenic incarceration, our penal drills are self defeatingly callous to correctional measures and our jail budgets bulge without countervailing community benefits because the Bench and the Bar have dismissed as below judicial visibility such patterns as probation, conditional release.
The time has come for Courts to abandon the Monroe Doctrine towards penology and concern itself with innovative sentences.
But this involves careful study of the convict and his potentiality for reform, not guess work nor insensitive assessments.
Therefore, we directed, right at the start, the Chief Probation Officer, Punjab, to make a report to this Court "as to the social circumstances and other relevant factors bearing on the consideration of eligibility of the petitioner to probation." That report has been received and its contents indicate competent advertence to pertinent criteria which we may briefly sum up.
The appellant is 32 years old.
His behavioral attitude is stated to be "obedient and law respecting in nature".
The officer goes on to state that the prisoner 's character is fairly good, that he is upright, alert and interested in rural games.
Of course, he seems to be wrestler of the locality which is good if it is practised as a game but dangerous if he exercises his muscles on other people 's flesh.
More importantly are the social influences that bear upon restraint and good behaviour.
He is a petty farmer who left school in his teens, has ten acres of land belonging to the joint family of himself and five brothers and the mother.
Being a cultivator and living in the joint family circumstances the officer finds no adverse remarks against him in the locality.
On the other hand, the report refers to his great respect for the former Sarpanch of the village.
His family circumstances evoke commiseration because his father is dead having been murdered in 1960.
His mother is alive 1138 and has to be maintained by himself and his two brothers who are truck drivers and the third a jawan.
He has his own nuclear family to maintain with a young wife and four children.
A pitiable factor is that his elder daughter is paralytic from birth.
His social position shows that he belongs to a lower middle class family, lives by agriculture, loves his mother and brothers and has earned the good will of his neighbours who think that the occurrence was induced by an irritating land issue and temporary intoxication.
A Sense of remorse has overcome him according to the Probation Officer who says that he is a first offender and not a recidivist.
It is a painful fact, as noted in the report that this criminal case has cost him a tidy sum, loss of prestige and even family separation.
In the unrefined English of the Probation Officer we may summarise his assessment of the offender: "It was met of an accident as offender client Dilbagh Singh seems to be law abiding and God fearing.
His one weakness is wine and that is the route cause of the present diviation, otherwise on the whole offender 's behaviour is normal and adjustable.
The offender is in curable stage as crime has not gone deep into him.
He can be adjustable amicably within his normal and natural environmental factors.
The client can easily be reformed as he is neither professional criminal nor exhibits any tendency to future deviation.
" The social milieu, the domestic responsibilities, the respect for the former Sarpanch he shows, the general goodwill he commands are plus points.
The tragic fact of his father 's murder and the running misfortune of his young daughter 's paralysed limbs are sour facets of his life.
The circumstance that he is gainfully employed as agriculturist and his brothers, though in diverse occupations, remain joint family members, are hopeful factors.
The aggressive episode which led to his conviction was induced by the company of his cousin who serves a seven year sentence and the inebriation due to drinking habit.
This simple villager responsible and gentle, sad and burdened, repentant and drained of his little wealth by the criminal case, has a long way to go in life being in his early thirtys.
The drinks vice was the minus point.
Many a peaceable person, on slight irritation, suffers bellicose switch over under alcoholic consumption.
How does judicial discretion operate in this skew of circumstances? To jail him is mechanical farewell to the finer sentencing sensitivity of the judge of salvaging a redeemable man by non institutionalised treatment.
The human consequences of the confinement process here will 1139 be no good to society and much injury to the miserable family and, above all, hardening a young man into bad behaviour, with prestige punctured, family injured, and society ill served.
Nor was the crime such, so far as his part was involved, as to deserve long deterrent incarceration.
Our prison system, until humane and purposeful reforms pervades, surely injures, never improves.
Prison justice has promises to keep, and ethological changes geared to curative goals are still alien from dress and bed, refusal of frequent parole and insistence of mechanical chores, bonded labour, nocturnal tensions, and no scheme to reform and many traditions to repress such is the zoological institutional realism and rehabilitative bankruptcy which inflict social and financial costs upon the State.(1) It is wasted sadism to lug this man into counter productive imprisonment for one year.
Long years ago, Franklin D. Roosevelt, in a forward looking speech on John Day, said: "If the criminal 's past history gives good reason to believe that he is not of the naturally criminal type, that he is capable of real reform and of becoming a useful citizen, there is no doubt that probation, viewed from the selfish standpoint of protection to society alone, is the most efficient method that we have.
And yet it is the least understood, the least developed, the least appreciated of all our efforts to rid society of the criminal.
"(2) The appellant has served a substantial part of his sentence in jail because of judicial innocence of the normae in the area of non institutional disposition.
It is easy to imprison, hard to individualise punishment.
Sentencing legality is violated when the judge shirks.
And the Bar is often alien to correctional alternatives and concentrates its ammunition on culpability and extenuatory scaling down of imprisonment.
The observations of the United States Supreme Court in Williams vs New York ; , 249) lay the right stress on pre sentence reports: "have been given a high value by conscientious judges who want to sentence persons on the best available information rather than on guess work and inadequate infor 1140 mation.
To deprive sentencing judges of this kind of information would undermine modern penological procedural policies that have been cautiously adopted throughout the nation after careful consideration and experimentation." Judge F. Rayan Duffy has written: "If the judge has before him a complete and accurate pre sentence investigation report which sets forth the conditions, circumstances, background, and surroundings of the defendant, and the circumstances underlying the offense which has been committed, the judge can then impose sentence with greater assurance that he has adopted the proper course.
He can do so with much greater peace of mind.
"(1) The purpose of section 360 of the Code is precisely this; the goal of section 235(2) is just this.
And yet, the exacting art is more honoured in the breach than in the observance if we many wrongly use a Shakespearean passage to drive home our point.
We stress the legal position so that subordinate courts may not treat conviction as the terminal point but the end of one chapter.
We are mindful of the complexity and remove the impression that easy resort to section 360 is right.
No; it is wrong.
Two quotes set the record straight.
"Imprisonment is the appropriate sentence when the offender must be isolated from the community in order to protect society or if he can learn to readjust his attitudes and patterns of behaviour only in a closely controlled environment.
"(2) "The consequences of a sentence are of the highest order.
If too short or of the wrong type, it can deprive the law of its effectiveness and result in the premature release of a dangerous criminal.
If too severe or improperly conceived, it can reinforce the criminal tendencies of the defendant and lead to a new offence by one who otherwise might not have offended so seriously again.
The decision which is presented at sentencing is also enormously complex.
It properly is concerned, and often predominantly, with the future which can be predicted for the particular offender.
But any single valued approach to sentencing is misdirected.
A sentence which is not in some 1141 fashion limited in accordance with the particular offence can lead to a system of incomparable brutality.
Per contra, a sentence or pattern of sentence which fails to take due account of the gravity of the offence can seriously undermine respect for law.
"(1) In this case, after perusal of the report of the Probation Officer, counsel for the State, Sri Hardev Singh, with fair candour and shared correctness, consented to a release of the prisoner under section 360.
We agree.
But one fact needs emphasis.
The close nexus between violence and alcohol is a call to the State in every criminal investigation to identify the role of alcohol in the commission of the offence and in every prisoner 's treatment to provide for anti alcoholic therapy.
To fail here is vicarious guilt of the State to Society.
We direct release of the appellant forthwith.
He will enter into a bond before the trial court together with Shri Dilbag Singh S/o Babu Singh as surety in the amount of Rs. 1000/ within two weeks of his release to keep the peace, be of good behaviour, to abjure alcohol and not to commit offence for a period of three years and to appear and receive sentence, if called upon in the meantime.
The appeal is allowed with this direction which is the Q.E.D. of sentencing justice.
V.D.K. Appeal allowed.
[/INST]In the case of a trial before a court of session, under section 235(2) Criminal Procedure Code "if the accused is convicted, the Judge shall, unless he proceeds in accordance with the provisions of section 360, hear the accused on the question of sentence, and then pass sentence on him according to law." Similarly, in the case of trial of warrant cases by Magistrates, under section 248 (2) of the Code, "where the Magistrate finds the accused guilty, but does not proceed in accordance with the provisions of section 325 or section 360, he shall after hearing the accused on the question of sentence, pass sentence upon him according to law.
" Section 361 of the Code mandates that "where in any case, the court could have dealt with: (a) an accused person under section 360 or under the provisions of the (Act XX of 1958) or; (b) a youthful offender under the (Act LX of 1960) or any other law for the time being in force for the treatment, training or rehabilitation of youthful offenders, but has not done so, it shall record in its judgment, the special reasons for not having done so." Thus, under the Criminal Procedure Code, 1973, recourse to the provisions of section 360 is a must.
In a trial against four persons charged by the Police with offences under sections 302, 324, 323 IPC, including constructive liability under section 34, two were, acquitted by the trial court and two were convicted.
The appellant was sentenced to rigorous imprisonment for one year and a fine of Rs. 200/ for causing simple injury to one Arjan Singh.
He was held vicariously guilty under sections 324/34 IPC and awarded two years rigorous imprisonment and a fine of Rs. 1000/ .
In addition he was convicted under section 323 IPC, for causing hurt to the daughter of the deceased and on this count punished with R.I. for one year together with a fine of Rs. 200/ .
Releasing the appellant on probation, the Court ^ HELD: 1.
Enacted law is guilty of inaction; because its obscure presence on the statute book escapes the vigilance of the Bar.
Where even the Court ignores what is vital to the little man the guarantee of sentencing legality becomes a casualty.
[1135H, 1136A] 1135 2.
To jail an accused is mechanical farewell to the finer sentencing sensitivity of the Judge of salvaging a redeemable man by non institutionalised treatment.
If the judge has before him a complete and accurate pre sentence investigation report which sets forth the conditions, circumstances, background, and surrounding of the accused and the circumstances underlying the offence which has been committed, the judge could then impose sentence with greater assurance that he has adopted the proper course.
The purpose of section 360 of the Code is precisely this and the goal of section 235(2) is just this.
[1138H, 1140B C] 3.
Sentencing legality is violated when the judge shirks.
And the Bar is often alien to correctional alternatives and concentrates its ammunition on culpability and extenuatory scaling down of imprisonment.
[1189F] 4.
Calling pre sentence investigation reports, bestowal of intelligent care on the choice between institutional and non institutional disposition like probation, conditional release and such community methods must form part of innovative sentences.
But this should be based on careful study of the convict and his potentiality for reform; not guess work, nor insensitive assessments.
[1137B E] Williams vs New York, ; , 249; quoted with approval.
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<s>[INST] Summarize the judgementCivil, Appeal No. 2272 of 1966, Appeal from the judgment and order dated January 6, 1966 of Calcutta High Court in Income tax Reference No. 211 of 1961.
section Mitra, A. section Nambiar, R. N. Sachthey and B. D. Sharma, for the appellant.
M. C. Chagla and P. K. Chatterjee, for the respondents 309 The Judgment of the Court was delivered by Hegde, J.
This is, an appeal by certificate, granted by the High Court of Calcutta under section 66A(2) of the Indian Income Tax Act, 1922 (to be hereinafter referred to as the Act) against the decision of that Court in a reference under section 66 (1) of that Act.
The two questions of law referred to the High Court by the tribunal are : (1) Whether section 16(3) of the Act was ultra vires the Central Legislature and (2) Whether on the facts and in the circumstances of the case, the income arising to the three minor sons of the assessee by virtue of their admission to the benefits of the partnership of Messrs. Ajitmal Kanhaiyalal was rightly included in the total income of the assessee under section 16 (3) (a) (iv) of the Act.
The assessee at whose instance those question were referred did not press for an answer in respect of question No. 1.
Therefore that question was not dealt with by the High Court.
Hence we need not go into that question.
The High Court answered the second question in favour of the assessee.
The facts necessary for the purpose of deciding the point in dispute as set out in the statement of the case submitted by the tribunal are as follows : The assessee Shri Ajitmal Parekh was a partner of the firma M/s. Ajitmal Kanhaiyalal having annas share therein.
He continued to be a partner of that firm till July 1, 1954 which was the last date of the accounting year of the firm, relevant for the, assessment year 1955 56.
On July 1, 1954, the assessee retired from the firm.
Thereafter he gifted to each of his four sons Rs., 75,000/ .
Out of his four sons, three were minors at that time.
There was a reconstitution of the firm with effect from July 2, 19.54 as evidenced by the partnership deed dated July 5, 1954.
The major son of the assessee became a partner of the reconstituted firm and his minor sons were admitted to the benefits of that partnership in the reconstituted firm.
The major son had 2 annas share.
His three minor brothers were admitted to the benefits of the partnership, each one of them having 2 annas share.
In the assessment year 1956 57, the Income tax Officer held that the income arising to the minors by virtue of their admission to the benefits of the partnership came within the purview of section 16(3) (a) (iv) of the Act.
He included that income in the total income of the assessee for that year.
In appeal the Appellate Assistant Commissioner substantially upheld the order of assessment made by the Income tax Officer but he held that the 2Supe Cl/7C 6 310 minors were entitled to only 1 9 pies share in the firm.
The assessee took up the matter in appeal to the Income tax Appellate 'Tribunal.
The tribunal upheld the decision of the Appellate Assistant Commissioner.
On the facts found by the tribunal, the High Court came to the conclusion that answer to question No. 2 should be in the negative and in favour of the assessee.
The tribunal found that the capital invested by the minors in the firm came from the gift made in their favour by their father, the assessee.
That finding was not open to question before the High Court nor did the High Court depart from that finding.
But on an interpretation of section 16(3) (a) (iv) the High Court opined that the answer to the question must be in favour of the assessee.
Section 16(3) (a) (iv) reads "In computing the total income of any individual for the purpose of assessment, there shall be included (a) so much of the income of a wife or minor child of such individual as arises directly or indirectly.
(iv) from assets transferred directly or indirectly to the minor child, not being a married daughter by such individual otherwise than for adequate consideration.
" Before any income of a minor child can be brought within the scope of section 16(3) (iv), it must be established that the said income arose directly or indirectly from assets transferred directly or indirectly by its father.
There is no dispute that the assessee had transferred to each of his minor sons, a sum of Rs. 75,000,/ .
It may also be that the amount contributed by those minors as their share in the firm came from those amounts.
But the question still remains whether it can be said that the income with which we are concerned in this case arises directly or indirectly from the assets transferred by the assessee to those minors.
The connection between the gifts mentioned earlier and the income in question is a remote one.
The income of the minors arose as a result of their admission to the benefits of the partnership.
It is true that they were admitted to the benefits of the partnership because of he contribution made by them.
But there is no nexus between the transfer of the assets and the income in question.
it cannot be said that that income arose directly or indirectly from the transfer of the assets referred to earlier.
Section 16(3) of the Act created an artificial income.
That section must receive strict construction as observed by this Court in Commissioner of Income Tax, Gujarat vs Keshavlal Lallubhai Patel(1).
In our (1) 311 judgment before an income can be held to come within the ambit of section 16(3), it must be proved to have arisen directly or indirectly from a transfer of assets made by the assessee in favour of his wife or minor children.
The connection between the transfer of assets and the income must be proximate.
The income in question must arise as a result of the transfer and not in some manner connected with it.
V.P.S. Appeal dismissed.
[/INST]The assessee was a partner in a firm.
On the last day of the accounting year of the firm, namely, 1st July 1954 he retired from the firm and gifted 'to each of his four sons Rs. 75,000.
The firm was reconstituted and the first son, who was a major, became a partner in the firm.
The other sons who were minors, became entitled to the benefits of the partnership because, they invested in the firm the amounts received by them as gifts from their father.
In the assessment year 1956 57 the Income tax Officer held that the income arising to the minors by virtue of their admission to the benefits of the partnership, came within the purview of section 16(3) (a) (iv) of the Income tax Act, 1922, and included that income in the total income of the assessee.
The order was confirmed by the Appellate Assistant Commissioner and the Tribunal, but the High Court on a reference, held in favour of the assessee.
In appeal to this Court, HELD : The section creates an artificial income and must be construed strictly, that is.
before an income can be held to come within the ambit of section 16(3) it must be proved to have arisen directly or indirectly from a transfer of assets made by the assessee in favour of the minor children.
The connection between the transfer and the income must be proximate.
It must arise as a result of the transfer and not in some manner connected with it.
[310 H; 311 A E] In the present case, the income of the minors arose as a result of their admission to the benefits, of partnershiip and there is no proximate nexus between the transfer and the income.
[310 G] C.I.T., Gujarat vs Keshavlal Lallubhai Patel, followed.
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<s>[INST] Summarize the judgementCivil Appeal No. 329 of 1966.
Appeal by special leave from the judgment and order dated October 11, 14, 1963 of the Bombay High Court in Appeal No. 30 of 1962 from the Appellate Decree.
D. Narsaraju and R.V. Pillai, for the appellant.
M.S.K. Sastri and M.S. Narasimhan, for respondent No. 1.
The Judgment of the Court was delivered by Ramaswami, J.
This appeal is brought, by special leave, on behalf of the .plaintiff against the judgment of the Bombay High Court dated October 11/14, 1963 in Appeal No. 30 of 1962 from the appellate order of the District Court, Osmanabad whereby the High Court reversed the judgment of the lower courts and declared that the appellant was not entitled to execute the decree for pre emption and that the respondents were entitled to be put in possession of the properties of which they were dispossessed in the enforcement of the pre emption decree.
The appellant had obtained a decree for possession of certain lands in a pre emption suit he had brought against the respondents.
The decree was made in March, 1945 and the appellant was directed to pay the consideration of Rs. 5,000 within six months from the date of the decree on which the appellant was to be put in possession of the suit lands.
In case of default in depositing the sum within the time the plaintiff 's suit was to be deemed to have been dismissed.
The respondents preferred an appeal to the District Court against the decree but the District Court confirmed the decree on January 28, 1955.
The amount of Rs. 5,000 was deposited in Court by the appellant on December 20, 1954 within the time granted in the trial court 's decree but it was subsequently withdrawn by him under orders of the Court.
While dismissing the appeal of the respondents and confirming the decree for pre emption, the District Court directed the appellant to deposit the sum of Rs. 5,000 on or before April 30, 1955 and directed the respondents on such deposit to deliver possession of the properties.
There was also a direction in the decree that in case the amount was not paid on the due date the suit shall stand dismissed with costs.
The decree was passed in conformity with O.20, r.14 of the Civil Procedure Code.
The respondents preferred a Second Appeal to the High Court and 516 pending disposal of the appeal the respondents prayed for stay of the execution decree.
On March 23, 1955 the High Court passed the stay order in the following terms: "Stay of execution of decree of the lower appellate court is granted on condition that the appellant furnishes security to the extent of the amount of costs.
" The order was received by the trial court on April 19, 1955.
The appellant who was directed under the terms of the lower appellate court 's decree to deposit the sum of Rs. 5,000 on or before April 30, 1955 made default in depositing the amount on that date.
He, however, deposited the amount on May 2, 1955.
Since the deposit was not made in time according to the lower appellate court 's decree an application was filed along with the deposit stating that the amount could not be paid in time as the appellant fell ill.
The Second Appeal preferred by the respondents to the High Court was dismissed on October 6, 1960 and the pre emption decree in favour of the appellant was confirmed.
Thereafter on February 3, 1961 the appellant flied a Darkhast for possession of the suit properties.
Since the application was within a year of the decree of the High Court a warrant for possession was issued by the Executing Court without notice to the respondents and the appellant also obtained possession of a portion of the suit properties under the aforesaid warrant.
On February 8, 1961 the respondents filed an application in the Executing Court for restitution of the properties taken possession of by the appellant on the ground that the appellant had defaulted in depositing the purchase money on or before April 30, 1955 as required by the lower appellate court 's decree and the Executing Court was in error in issuing the warrant for possession of the suit properties.
The application for restitution was contested by the appellant on the ground that the stay order made by the High Court in the Second Appeal prevented him from acting in accordance with the terms of the lower appellate court 's decree and in any case the High Court had dismissed the Second Appeal and the decree holder would get by necessary implication a fresh starting point for depositing the purchase amount from the date of the High Court 's decree.
The Executing Court rejected the claim of the respondents for restitution and 'allowed the execution case of the appellant to proceed.
Against this order of the Executing Court the respondents went up in appeal to the District Court which dismissed the appeal and confirmed the order of the Executing Court.
The respondents thereafter took the matter in Second Appeal to the Bombay High Court which differed from the view of the District Court and allowed the appeal.
The High Court took the view that there was default on the part of the appellant in depositing the amount and therefore the appellant 's 517 suit stood dismissed automatically and the appellant was not therefore entitled to possession in enforcement of the pre emption decree.
The first question arising in this appeal is whether the High Court was right in taking the view that the effect of the stay order dated March 23, 1955 was merely to stay the delivery of possession by the judgment debtors and not a stay with regard to the deposit of purchase price by the decree holder.
In our opinion, the High Court was in error in taking this view.
The decree framed under O.20, r. 14, Civil Procedure Code requires reciprocal rights and obligations between the parties.
The rule says that on payment into court of the purchase money the defendant shall deliver possession of the property to the plaintiff.
The decree holder therefore deposits the purchase money with the expectation that in return the possession of the property would be delivered to him.
It is therefore clear that a decree in terms of O.20, r.14; Civil Procedure Code imposes obligations on both sides and they are so conditioned that performance by one is conditional on performance by the other.
To put it differently, the obligations are reciprocal and are inter linked, so that they cannot be separated.
If the defendants by obtaining the stay order from the High Court relieve themselves of the obligation to deliver possession of the properties the plaintiff decree holder must also be deemed thereby to be relieved of the necessity of depositing the money so long as the stay order continues.
We are accordingly of the opinion that the order of stay dated March 23, 1955 must be construed as an order staying the whole procedure of sale including delivery of possession as well as payment of price.
The effect of the stay order therefore in the present case is to enlarge the time for payment till the decision of the appeal.
We are further of the opinion that the effect of the order of the High Court dated October 6, 1960 dismissing the Second Appeal was to give by necessary implication a fresh starting point for depositing the amount from the date of the High Court 's decree.
The decree of the High Court was dated October 6, 1960 and the appellant could have deposited the amount immediately after this date.
But the appellant has deposited the amount on May 2, 1955, long before the date of the High Court 's decree and there is no default on the part of the appellant in fulfilling the terms of the pre emption decree.
In the present case, when the High Court dealt with the Second Appeal filed by the respondents, the time limited by the trial court for making the deposit had expired.
It was open to the respondents to press this point in the Second Appeal and for the High Court to decide that, the time having expired, it was not open to the plaintiff to make the deposit and there was nothing before the 518 High Court for decision.
It was equally open to the High Court to dismiss the appeal and expressly extend the time for making the deposit.
When the High Court refrained from following the first course and confirmed the trial court 's decree, what was its intention ? Surely it wanted to give the plaintiff an effective decree in his favour.
If so, we are justified in holding that the High Court intended to exercise its power of extending the time for making the deposit, and incorporated in its decree the relevant provisions of the trial court 's decree.
That is to say, this is a case in which we must hold that a fresh starting point is implied in the decree of the High Court in the Second Appeal.
The view that we have expressed is borne out by the decision of the Bombay High Court in Satwaji Balajiray Deshamukh vs Sakharlal Atmatarnsher(1).
In that case, the plaintiff brought a suit to recover possession of property as purchaser from defendants 1 to 6 and to redeem the mortgage of defendant 7.
The first court having dismissed the suit, the appellate court, on plaintiff 's appeal, passed a decree directing the plaintiff to recover possession on payment to defendants 1 to 6 of a certain sum within six months from the date of its decree and then to redeem defendant 7, and on the plaintiff 's failure to pay within six months from the date of the decree he should forfeit his right to recover possession.
All parties being dissatisfied with the decree, the plaintiff preferred a second appeal to the High Court and the two sets of defendants filed separate sets of cross objections.
The High Court confirmed the decree and the plaintiff 's second appeal and the defendants ' cross objections were dismissed.
Within six months from the date of the High Court 's decree the plaintiff deposited in court the amount payable by him and applied for execution.
Defendant 7 contended that the plaintiff not having complied with the terms of the decree of the first appellate court, his right to recover possession in execution was.
forfeited.
The lower courts upheld the defendant 's contention and dismissed the darkhast.
On second appeal by the plaintiff, the High Court reversed the decree of the lower court and held that the time for executing a decree nisi for possession ran from the date of the High Court 's decree confirming the decree of the lower court, for what was to be looked at and interpreted was the decree of the final appellate court.
There is also a decision to the similar effect in Sita vs Ramnath(2).
For the reasons already given we hold that the decree of the High Court in Second Appeal should be construed in the present case as affording by implication a fresh starting point to the plaintiff for making payment to the Court.
For the reasons expressed we hold that this appeal should be allowed, the judgment of the, Bombay High Court dated October (1) I.L.R. (2) I.L.R. 28 Patna 371.
519 11/14, 1963 should be set aside and the application of the first defendant made on February 8, 1961 for restitution under section 144 of the Civil Procedure Code should be dismissed.
In the circumstances of this case we do not propose to make any order as to costs of this appeal.
T.P. Appeal allowed.
[/INST]The Government of Central Provinces and Berar (Now State of Madhya Pradesh) fixed in 1948 a scale of dearness allowance for its servants which though practically identical with the scale of dearness allowance fixed by Central Government in respect of salaries over Rs. 400 per mensem was less than it in respect of salaries for Rs. 400 per mensem or less.
The petitioner State government servant challenged the validity of the order of the State Government on the ground that his fundamental right under article 14 of the Constitution had been violated inasmuch as he had a right to be equally treated with the Central Government Servants similarly situated.
Held, that under the provisions of Rule 44 of the Fundamental Rules it is a matter of discretion with the local Government whether it will grant dearness allowance to any Government servant and if so how much.
It imposes no duty on the State to grant it and therefore no mandamus can issue to compel the State to grant it nor can any other writ or direction be issued in respect of it as there is no right in the Government servant which is capable of being protected or enforced.
Article 14 does not authorise the striking down of a law of one State on the ground that in contrast with a law of another State on the same subject its provisions are discriminatory.
Nor does it contemplate a law of the Centre or of the State dealing with similar subjects being held to be unconstitutional by a process of comparative study of the provisions of two enactments.
The sources of authority for the two statutes being different, Article 14 can have no application.
Therefore 'the scale of dearness allowance sanctioned by the Central Government can furnish no ground for holding that the allowance sanctioned by the Government of Central Provinces and Berar is repugnant to Article 14.
The State Government was entitled to fix the Government of India rates for one slab and Ali; different rates for another slab, 600 The Punjab Province vs Pandit Tara Chand ([1947] F.C.R. 89), and State of Bihar V. Abdul Majid ([1954] S.C.R. 786) distinguished.
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<s>[INST] Summarize the judgementAppeals Nos.
1091 1103 of 1964.
Appeals from the judgment and decree dated April 17, 1957 of the Patna High Court In Second Appeals Nos.
1447 of 1950 etc.
C.B. Agarwala and D. Goburdhun, for the appellant (in all the appeals).
U.P. Singh and K.C. Dua, for respondents Nos. 3 and 4 (in C.A. No. 1091 of 1964) respondent No. 3 (in C.A. No. 1092 of 1964) respondent No. 4 (in C.A. No. 1093 of 1964), respondent No. 7 (in C.A. No. 1094 of 1964), respondent No. 3 (in C.A. No. 1096 of 1964) respondents Nos. 4 and 5 (in C.A. No. 1095 of 1964) and respondent No. 4 (in C.As.
1099, 1100 and 1101 of 1964).
The Judgment of the Court was delivered by Hidayatullah, C.J.
These are 13 appeals by certificate against the common judgment in second appeal, April 17, 1957, of the High Court of Patna.
The appellants are the original plaintiffs.
The appellants had filed 12 title suits for ejectment in the court of the Second Munsif at Buxar.
Eleven suits were dismissed.
It was held that the plaintiffs had no title to suit lands.
One suit was compromised and decreed in terms of the compromise.
Two other suits one by Kedar Nath (one of the plaintiffs in the 12 title suits) and the other by one Udholal were filed for rent for 1335 1337 Fasli in respect of some lands comprised in Survey No. 3385 of Mouza Buxar against the tenant Ram Chhabi Lal.
The two rent suits were heard together.
Kedar Nath was held to be the landlord and not Udholal.
The suit of the former was decreed and that of the latter dismissed.
On appeals filed by Udholal the decision was reversed.
Appeals by Kedar Nath to the High Court were dismissed on the ground that in the title suits from which eleven appeals were filed it was held by the High Court affirming the decision of the courts below that Kedar Nath had no title.
Since the success of the last two appeals depended on whether Kedar Nath had title or not it is not necessary to refer to them at this stage.
We shall deal with the other eleven appeals first.
in these appeals, plaintiffs and defendants 1 to 3 are common.
Plaintiffs are purchasers from the mortgagees of the suit 206 lands who had purchased the suit lands in an auction sale in execution of the mortgage decree.
Defendants 1 to 3 were the former owners of these suit lands and the other defendants were either purchasers at auction sales in execution of money decrees against the owners or transferees from the auction purchasers.
The suits concern plots formed out of two Survey Nos. 3384 and 3385.
It is thus that the other two suits get connected with the title suits because in those suits the rent of certain plots from Survey No. 3385 was involved.
The history of the plots is as follows : One Laxmi Narain was the previous owner of these 2 Survey Nos.
On his death his daughter 's sons Ram Narain Ram, Sheonarain Ram and Gopal Ram inherited these Survey Nos.
alongwith other properties.
The first two sons were defendants 1 to 2 in the suits and defendant 3 is the son of Sheonarain Ram.
In 1930 the other two brothers sued Gopal Ram for a partition.
Preliminary decree was passed on April 15, 1931 and the final decree on September 10, 1932.
Half share in the property went to Gopal Ram and the other half jointly to the other two brothers.
The suit Survey Nos.
came to the share of Ram Narain Ram and Sheonarain Ram.
On April 27, 1931 Ram Narain Ram executed a mortgage of a half share in 27 plots made in the two Survey Nos.
and some other property with Buxar Trading Co operative Society.
On April 20, 1933, the Society released Ram Narain Ram 'S share in the 27 plots from the mortgage by a registered release deed.
On September 20, 1932 Sheonarain Ram filed a suit for 'partition against Ram Narain Ram.
The preliminary decree was passed in May 1933, that is to say, after the release by the Society.
The two brothers divided the two Survey Nos.
half and half between them.
No final decree in this partition suit seems to have been passed.
Devendra Nath (one of the defendants) obtained settlement of 3 k 13 d of land out of Survey No. 3384 from Sheonarain Ram on June 10, 1933 and in execution of a money decree against Ram Narain Ram and Sheonarain Ram purchased on August 13, 1934 the remaining portion of Survey No. 3384 and Survey No. 3385.
He obtained possession on February 27, 1935.
He had obtained attachment of the two plots before judgment, on April 23, 1934.
Devendra Nath disposed of 3 k 13 d by settling them on his wife and she was one of the defendants in the suits.
Devendra Nath 's title depends on whet.her the release by the Society was valid and binding on the Society or not.
If the release was valid and binding on the Society, the Society could not obtain a decree in respect of these two Survey Nos.
and bring them to sale.
207 This is one of the points for consideration in these appeals.
The High Court and the court below have decided unanimously that the release was binding on the Society and Devendra Nath obtained no title.
On April 26, 1934, that is to say, before Devendra Nath 's purchase but after attachment by him, the Society applied to ,.he
Registrar, Co operative Societies for a mortgage award.
In that application the surety of Ram Narain Ram was also joined.
On August 16, 1934 a money award was given against Ram Narain Ram and his surety.
On September 20, 1934 the money award was cancelled and a preliminary mortgage award was passed.
Admittedly the mortgage award had the force of a mortgage decree.
The final mortgage award was made on May 28, 1935.
The award ordered sale of all .mortgage properties including the half share of Ram Narain Ram in survey Nos. 3384 and 3385.
No mention was made of the earlier release of the Survey Nos.
by the Society by a registered deed.
In execution of the decree the Society purchased the two Survey Nos.
on February 7, 1936 and obtained possession o.n July 20, 1937.
One Dwarikanath had a money decree against the Society and he attached the two disputed Survey Nos. and brought them to sale.
The Buxar Central Co operative Bank purchased the two Survey Nos.
in auction sale on February 8, 1940 obtaining possession on July 5, 1941.
On March 28, 1943 the Society and the Bank went into liquidation.
The right, title and interest of the Society and the Bank was sold by the common Liquidator to Kedar Nath including the 27 plots made in the two Survey Nos.
Kedar Nath 's purchase was on March 20, 1943 but he took the sale benami in the name of Dhanesar Pandey, who was plaint.
ill No. 2 in the title suits while Kedarnath was plaintiff No. 1.
The title of the plaintiffs Kedar Nath and Dhanesar Pandey is based on this purchase.
After the release of the two Survey Nos.
by the Society, Ram Narain Ram and Sheonarain Ram, and after his purchase, Devendra Nath, made settlement of the plots to various persons.
They are the remaining defendants in the suits and respondents in the various appeals before us.
The High Court has given a chart of these persons and the dates of pattas but as nothing turns upon these details it is not necessary to mention them here.
The plaintiffs (Kedar Nath and Dhanesar Pandey) in these title suits asked for declaration of title and possession.
Their case was that the release was void and inoperative and not binding on the Society.
Therefore, the mortgage award and the auction sale was binding on Ram Narain Ram and all those who derive title 208 from him.
Their next contention is that.
, in any event, the transfers to the defendants were effected during the pendency of the mortgage award proceedings and were affected by the doctrine of lis pendens.
These two grounds were not accepted by the High Court and the courts below and it is these two grounds which were urged before us in these appeals.
The other side seeks to avoid the effect of lis pendens by pleading that the mortgage award was claimed mala fide against the suit plots after their release and, in any event, there was attachment of these plots before the petition for the mortgage award was made.
Before we deal with these two points it may be mentioned at once that neither ground of appeal applies to the transfers by Sheonarain who was not a mortgagor and who was not affected by the release deed made by the Society.
Mr. C.B. Aggarwal frankly conceded that the transfer by him could not be assailed and must stand.
He, therefore, did not press Civil Appeals Nos.
1091, 1092, 1093 and 1094 of 1964.
These appeals are accordingly dismissed with costs.
We may first consider whether the release was binding on the Society or not.
When Ram Narain Ram mortgaged the property to raise a loan from the Society of which he was a member, half share in the plots belonged to him because these plots had fallen in the preliminary decree to.
the share of his brother Sheonarain Ram and himself.
That preliminary decree was passed on April 15, 193 1.
The Society had fixed a ceiling on the amount which could be borrowed, at Rs. 3000/ .
The mortgage deed recited that the amount borrowed was Rs. 3000/ with interest at Actually Rs. 1890/ were given as a loan.
The release deed, releasing the suit plots was executed in pursuance of a resolution of the Society (Res.
No. 4 dated April 4, 1933).
The release stated thus: " . relinquished and released the properties, specified below, from the debt due to the said Ram Narain Ram, to the said society, entered in the said mortgage bond, in favour of Ram Narain Ram .
The said property shall not be made liable for any debt of the said society nor shall any incumbrance be recovered from the said property.
The said property shall come in possession of Ram Narain Ram.
The said Ram Narain Ram shall have right to sell the property to keep the same in whatever ways he likes.
The said society neither has nor shall have any objection thereto.
" 209 Why the release was granted by the Society was stated in the following words: " .
A petition was filed on behalf of the said Ram Narain Ram in the meeting of the members in the presence of all the members of the society for releasing some land from the said mortgage in order to repay the debt.
of Rs. 500/ forming part of the debt due by the said Ram Narain Ram to the said co operative society which was put up before all the members and accepted by them . ".
It appears that Ram Narain Ram did not pay the amount of Rs. 500/ to the Society and the Society considered itself free to include these two plots, notwithstanding the release, in their application for an award decree.
In our opinion the release was binding on the Society.
The argument.
in opposition to the binding nature of the release is that it was conditional on payment of Rs. 500/ .
This is no true.
No. doubt the motive for the release was the payment of Rs. 500/ to the Society promised by Ram Narain Ram, but the payment was not made a condition of the release.
There was no attempt to release this amount from Ram Narain Ram.
Therefore, the release being absolute and unconditional and by a registered deed must be treated as binding.
It is open to the promisee to waive the performance of any part of the contract or to release any property from the operation of a 'mortgage or charge.
If he wishes his rights to continue in the.
event of some condition simultaneously imposed on the promisor, he must see that the release is made dependent on the performance by the promisor of his part of the agreement.
Here the Society merely released the two plots without making the payment a condition precedent, and the release operated.
That, however, is not the end of the matter.
The Society filed on April 5, 1934 a petit.ion for a mortgage award before the Assistant Registrar, Co operative Societies.
The petition is headed 'Petition for mortgage decree '.
The petition mentioned that the mortgage was made on April 27, 1931 and that the amount secured was Rs. 3,000/ with interest at 121/2% per annum.
The petition then described the property mortgaged and it included plots Nos.
3385 and 3384.
The amount due on December 31, 1933 was said to be Rs. 2440/3.
The relief asked for was: "We the punches therefore pray that a decree may be passed by your honour against the said member and he may be directed under the decree to pay the debt, principal and interest, amounting to Rs. 2440/3/ within 3 months, that in case of non payment this order may be passed that the entire amount may be realized by 210 auction sale of the mortgaged property and that if the mortgaged property would not be sufficient for the satisfaction of the entire amount of the decree the punches of the committee be allowed to pray for passing a personal decree against the said member.
" When the Registrar made his order he overlooked that a mortgage award had to be pass.ed.
On August 16, 1934 he ordered that an award jointly with sureties be issued.
However, on September 2, 1934, .he corrected Iris earlier order thus: "S1. '6.
Read along with S1.
By mistake of the 2nd Asst.
simple award was issued instead of Mortgage award.
Issue mortgage award and ask the C.B. to return the simple award which will be cancelled here.
Syed Ozair.
D.F.A. Addl.
A.R. 2 9 34.
" After 'this mortgage award which had the force of a preliminary decree, the Society on December 16, 1934 resolved that a final mortgage decree be obtained from the Assistant Registrar, and a final decree was obtained and the property brought to sale on February 7, 1936 and purchased by the Society itself with the permission of the court executing the decree.
Possession was obtained on July 20, 1937.
Therefore, litigation in respect of this mortgage remained pending from April 5, 1934 to July 20, 1937.
Under Explanation to section 52 of the the whole of this period denoted pendency of the proceeding for purposes of application of the doctrine of lis pendens.
All the leases made by Devendranath were after the proceedings commenced.
Devendranath purchased the right title and interest of Ram Narain Ram on August 13, 1934.
His acquisition was prima facie hit by the doctrine of lis pendens.
Three arguments were advanced before us to meet this situation and we shall now deal with them seriatim.
The first argument is that there could be no lis pendens till August 16, when the money award was issued because a money suit for proceeding cannot lead to the application of the doctrine of lis pendens.
As a proposition of law the argument is sound but it is wrongly grounded on fact.
The proceeding was to get a mortgage award, the equivalent of a mortgage decree.
The Court made a mistake and treated it as a proceeding for a money decree.
When the court corrected its,order, the mortgage award related back to the petition as made and the whole of the proceeding must be treated as covered by the doctrine.
We cannot, therefore, accede to the suggestion that the doctrine did not apply; at any rate, on this suggested ground.
211 The second ground of attack is that before the proceedings commenced before the Registrar these fields had been attached and, therefore, the doctrine of lis pendens again cannot apply.
We are unable to accept this argument either.
If the property was acquired pendente lite, the acquirer is bound by the decree ultimately obtained in the proceedings pending at the time of acquisition.
This result is not avoided by reason of the earlier attachment.
Attachment of property is only effective in preventing alienation but it is not intended to create any title to the property.
On the other hand, section 52 places a complete embargo on the transfer of immovable property right to which is directly and specifically in question in a pending litigation.
Therefore the attachment was ineffective against the doctrine.
Authority for this clear position is hardly necessary but if one is desired it will be found in Moti Lal vs Karrab ul Din and others(1).
Lastly it was contended that the sale was by court auction and the doctrine of lis pendens would not apply to such a sale.
This point was considered in Samarendra Nath Sinha and Anr.
vs Krishna Kumar Nag(2) by one of us (Shelat, J.) and it was observed as follows : " .
The purchaser pendente lite under this doctrine is bound by the result of the litigation on the principle that since the result must bind the party to it so it must bind the person driving his right, title and interest from or through him.
This principle is well illustrated in Radhamadhub Holdar vs Monohar(3) where the facts were almost similar to those in the instant case.
It is true that section 52 strictly speaking does not apply to involuntary alienations such as court sales but it is well established that he principle of lis pendens applies to such alienations.
(See Nilkant vs Suresh Chandra(4) and Moti Lal vs Karrab ul Din(1). ' ' This ground also has no validity.
Lastly it was argued that if the fields were released from the operation of the mortgage they could not be made the, subject of a mortgage decree, and whatever was done in the mortgage proceedings was not of any consequence.
this there are two answers.
Firstly, the respondent before the Registrar (Ram Narain Ram) made no objection to ,the inclusion of the plots in the petition for a mortgage award.
Secondly, the doctrine of lis pendens applies irrespective of the strength or weakness of the case on one side or other.
See Gouri Dutt Maharaj vs Sukur Mohammed and Ors.(5).
There is, however, one condition that (1) 24 I.A. 170.
(3) 15 I.A. 97.
(2) ; (4) 12 I.A. 171.
(5) 75 i.
A. x65.
212 the proceedings must be bona fide.
Here no doubt the Society knew that the plots had been released from the mortgage, but it was also clear that the release was to enable Ram Narain Ram to dispose of some of the plots and pay Rs. 500/ to the Society.
This amount was never paid and the Society must have bona fide felt that the plots still remained encumbered.
In fact the attitude of Ram Narain Ram in not claiming that these plots be removed from the mortgage award shows that he too felt that this was the true position.
In Gouri Dutt Maharaj 's(1) case referred to by us, it was said that if the proceedings were bona fide, the applicability of section 52 was not avoided.
For the above reasons we are clear that the purchase by Kedarnath was protected by the doctrine of lis pendens, the prior transfer to the defendants notwithstanding.
In this view of the matter the judgment of the High Court cannot be sustained.
The appeals will, therefore, be allowed.
The judgment and decree of the High Court will be set aside and the suits of the appellant will be decreed with costs throughout.
In this Court the costs will be one set.
R.K.P.S. Appeals allowed.
(1) 75 X.A. 165 L 1 Sup./70 6 7 70 GIPF.
[/INST]One R executed a mortgage of his share in two survey Nos.
to a Cooperative Society.
On his application and in order to enable him to repay a sum of Rs. 500/ , the Society released the property in 1933, but R never paid the amount to the Society.
The Society filed an application for a mortgage award on April 5, 1934 and the Assistant Registrar made an award in the nature of a preliminary decree, on December 16, 1934.
Thereafter a final mortgage decree was passed by the Assistant Registrar and the two survey nos.
were brought to sale and purchased by the.
Society and possession was obtained on July 20, 1937.
Meanwhile, one D obtained attachment before judgment of the two survey nos., as the property of R, in a suit for money against R, and, in execution of the money decree, purchased the two survey nos.
on August 13, 1934.
In 1943, the Society went into liquidation and the liquidator sold the properties of the Society and the appellant bought the two.
survey nos.
He filed a suit for a declaration of his title and possession of the properties in the two, survey nos.
from various persons who were in possession of the properties under R and D.
The High Court dismissed the .suit.
In appeal to this Court, HELD: (1) The motive of the release, in 1933, of the properties by the Society in favour of R was the payment of Rs. 500/ by R to the Society, but it was not a condition Of the release.
Therefore, the release was binding on the Society.
[209 D E] (2) But R did not object to the inclusion of the items in the mortgage award.
Therefore, the Society must have bona fide felt that the properties remained encumbered.
[211 G] (3) The proceedings in respect of the mortgage were pending from April 5, 1934 to July 20, 1937.
The proceedings were for obtaining a mortgage award equivalent to a mortgage decree and not for a money decree.
The fact that they were attached before judgment in D 's suit does not affect the application of the doctrine of lis pendens.
Attachment is only effective in preventing alienation and does not create title to property.
If in fact, the property was.
acquired pendente lite, the acquirer is bound by the decree ultimately obtained.
Therefore, D 's purchase on August 13, 1934, was hit by the. doctrine.
of lis pendens in section 52 of the .
Since D 's purchase was hit by the doctrine the properties continued to be those of the Society and hence, the appellant was entitled to them.
[210 E, G H; 211 A C] 205 Samarendra Nath Sinha & Anr.
vs Krishna Kumar Nag, ; , followed.
Moti Lal vs Karrab ul Din & Ors.
24 I.A. 170 and Gouri Dutt Maharaj vs Sukur Mohammed and Ors.
75 I.A. 165, applied.
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<s>[INST] Summarize the judgementAppeal No. 26 of 1966.
Appeal from the judgment and order dated October 28, 1964 of the Punjab High Court in I. T. Reference No. 28 of 1962.
section K. Mitra, Gopal Singh, section P. Nayyar and R. N. Sachthey,.
for the appellant.
Veda Vyasa and B. N. Kirpal, for the respondent.
The Judgment of the Court was delivered by Sikri, J.
At the instance of the Commissioner of Income Tax,, the Appellate Tribunal, Delhi Bench "C", referred the following question "Whether the cost of land is entitled to depreciation under the schedule to the Income tax Act alongwith the cost of the building standing thereon.?" 182 This question arose out of the following facts : The respon dent, M/s Alps Theatre, hereinafter referred to as the assessee, carries on business as exhibitor of films.
The Income Tax Officer initiated proceedings under section 34(1)(b) of the Indian Income Tax Act, 1922, on the ground that in the original assessment depreciation was allowed on the entire cost of Rs. 85,091/ , shown as cost ,of the building which included Rs. 12,000/ as cost of land.
The Income Tax Officer, by his order dated February 22, 1959, recomputed the depreciation, excluding cost of land.
The assessee ap pealed to the Appellate Assistant Commissioner.
The Appellate Assistant Commissioner upheld the order of the Income Tax Officer.
The assessee then appealed to the Appellate Tribunal which accepted the appeal.
In accepting the appeal it observed as follows : "You cannot conceive of a building without the land beneath it.
It is not possible to conceive of a building without a bottom.
What Section (10) (2) (vi) of the Act says is that depreciation will be allowed on the building.
The word "building" itself connotes the land upon which something has been constructed.
It was, therefore, wrong on the part of the authorities below to exclude the value of the land upon which some construction was made.
The true meaning of the word 'building ' means the land upon which some construction has been made.
The two must necessarily go together.
" The High Court answered the question referred to it against the Department.
Mahajan, J., observed that in Section 10(2)(vi) of the Income Tax Act, a building is placed at par with machinery and furniture and is treated as a unit, and, therefore, for the purposes of depreciation a building cannot be split up into building material and land.
He further observed that if the Legislature wanted to exclude land from the building for purposes of depreciation it could have said so.
He then added : "Moreover, depreciation is allowed on the capital.
The capital here is a unit building.
If later on it is sold and it fetches more than its written down value the surplus is liable to tax [see in this connection Section 10(2) (vii) proviso.]" He felt that "the crux of the matter is that the building is treated as a unit for purposes of depreciation or repair, and there is no warrant in the Act which would permit us to split the unit for the purposes of section IO." He further felt that at any rate two equally plausible interpretations are possible and the one in favour of the assessee should be adopted.
183 Dua, J., in a concurring judgment, felt that the question was not free from difficulty, but he answered the question in favour of the assessee on the ground that much could be said for both points of view and the view in support of the assessee 's submission had found favour with the Tribunal which had not been shown to be clearly erroneous.
The answer to the question depends upon the true interpreta tion of section 10(2)(vi), and in particular whether the word "building" occurring in it includes land.
Section 10 deals with the profits and gains derived from any business, profession or vocation.
Section 10(2) provides that such profits or gains shall be computed after making certain allowances.
The object of giving these allowances is to determine the assessable income.
The first three allowances consist of allowance for rent paid for the business premises, allowance for capital repairs and allowance for interest in respect of capital borrowed.
Sub clauses (iv), (v), (vi), (vi a) and (vii) of section 10(2) deal with allowances in respect of buildings, machinery, plant or furniture.
The word "building" must have the same meaning in all these clauses.
Sub clause (iv) runs as under : "in respect of insurance against risk of damage or destruction of buildings, machinery, plant, furniture,stocks or stores, used for the purpose of the business,profession or vocation, the amount of any premium paid.
" "Building" here clearly, it seems to us, does not include the site because there cannot be any question of destruction of the site.
Clause (v) reads : " in respect of current repairs to such buildings, machinery, plant or furniture, the amount paid on account thereof.
" This again cannot include the site.
Then we come to sub cl.
(vi), the relevant portion of which reads as under : "in respect of depreciation of such buildings, machinery, plant or furniture being the property of the assessee, a sum equivalent . as may in any case or class of cases be prescribed.
" It would be noticed that the word used is "depreciation" and "depreciation" means : a decrease in value of property through wear, deterioration, or obsolescence the allowance made for this in book keeping, accounting, etc." (Webster 's New World Dictionary ').
In that sense land cannot depreciate.
The other words to notice are "such buildings".
We have noticed that in sub cls.
(iv) and 184 (v), "building" clearly means structures and does not include site.
That this is the proper meaning is also borne out by r. 8 of the Indian Income Tax Rules, 1922.
Rule 8 has a schedule, and as far as buildings are concerned, it reads as under : Class of asset Rate per Remarks centage 1.Buildings (1) First class substantial buildings of materials. 2.5 Double these numbers (2)Scond class building will be taken for factory of less substantial con 5 buildings excluding struction. offices,godowns,officer 's (3)Third class building 7.5 and employees quarters.
of construction infeior to that of second class building,but not inclu ding purely temporory erection.
(4) Purely temporary No rate is prescribed: erection such as wooden renewals will be allowed structure.
as revenue expenditure.
The rate of depreciation is fixed on the nature of the structure.
If it is a first class substantial building, the rate is less.
In other words, first class building would depreciate at a much less rate than a second class building.
It would be noticed that for purely temporary erections, such as wooden structures, no rate of depreciation is prescribed and instead renewals are allowed as revenue ex penditure.
But if the contention of the respondent is right, some rate for depreciation should have been prescribed for land under the temporary structures.
Further it would be difficult to appreciate why the land under a third class building should depreciate three times quicker than land under a first class building.
One other consideration is important.
The whole object of section 10 is lo arrive at the assessable income of a business after allowing necessary expenditure and deductions.
Depreciation is allowable as a deduction both according to accountancy principles and according to the Indian Income Tax Act.
Why '? Because otherwise one would not have a true picture of the real income of the business.
But land does not depreciate, and if depreciation was allowed it would give a wrong picture of the true income.
The High Court relied on Corporation of the City of Victoria and Bishop of Vancouver Island(), but in our view this case is distinguishable and gives no assistance in determining the meaning of the 'word 'buildings ' in the context of section 10(2)(vi).
In this case the Privy Council had to construe section 197(1) of the Municipal Act, British Columbia, which exempted from municipal rates and taxes (1) [1912] 1 2 A.C. 384.
185 "every building set apart and in use for the public worship of God." The Privy Council held that the above exemption applied to the land upon which a building of the description mentioned above was erected as well as to the fabric.
The Privy Council was not concerned with the question of depreciation but with the question of exemption from Municipal rates.
In the result the appeal succeeds, the judgment of the High Court set aside and the question referred is answered in the negative and against the assessee.
In the circumstances there will be Y.P Appeal allowed.
[/INST]The Revenue authorities did not allow depreciation on the cost of land alongwith the cost of building standing thereon.
The Appellate Tribunal accepted the assessee 's appeal and the High Court answered the question in favour of the assessee.
In appeal to this Court by the Revenue: HELD: The appeal must be allowed.
Building under section 10(2), does not include the site because there cannot be any question of destruction of the site.
[183 E] The word used in section 10(2)(vi) is "depreciation" and "depreciation" means "a decrease in value of property through wear, deter oration, or obsolescence, and allowance made for this in book keeping, accountings etc." In that sense land cannot depreciate.
[183 H] By r. 8 of the Indian Income tax Rules the rate of depreciation is fixed on the nature of the structure.
It would be difficult to appreciate why the depreciation of land would be dependant on the class of structures.
[184 D E] The whole object of section 10 is to arrive at the assessable income of a building after allowing necessary expenditure and deductions.
If depreciation on land was allowed it would give a wrong picture of the true income.
[184 F G] Corporation of the City of Victoria and Bishop of Vancover , distinguished.
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<s>[INST] Summarize the judgementAppeal No. 742 of 1967.
Appeal from the judgment and decree dated April 4, 1960 of the Madras High Court in Appeal No. 334 of 1956.
M. Natesan, K. section Subramanian and K. Jayaram, for the appellant.
A. V. Rangam and A,.
Subhashini, for the respondent.
The Judgment of the Court was delivered by Grover, J.
This is an appeal by Certificate from a judgment of the Madras High Court.
The appellant 's predecessor in office T. G. Kuppuswamy Iyer filed on April 14, 1950 a suit in the District Court, Madurai, under section 84(2) of the Madras Hindu Religious Endowments Act, 3 L152SupCI./7 586 (Act 11 of 1927) against the respondent and two other persons who are not parties to the appeal for a declaration that the suit Mandapam was a private Mandapam, i.e., family property of Thoguluva Thirumalier and was not a temple covered by the provisions of the aforesaid Act.
This suit had to be instituted because the authorities appointed under the Madras Act 11 of 1927 held that the premises No. 29 South Masi Street, Madurai wherein the idol of Sri Srinivasaperumal and certain other idols Were located was a temple within the meaning of the said Act.
The District Judge decreed the suit in favour of the appellant but the High Court, on appeal, reversed that judgment and passed a decree holding that the premises constituted a temple.
The appellant thereupon filed a petition for leave to appeal to this Court but the High Court refused to grant the certificate.
The matter was brought to this Court.
By a judgment which is reported in T. D. Gopalan vs Commr. of Hindu Religious & Charitable Endowments, Madras(1) this Court directed that the subject matter of the dispute should be ascertained with reference to the claim made by the plaintiff in his plaint.
Consequently the valuation of the property should have been done according to the claim made in the plaint, namely, that the property was private pro perty of the family capable of alienation.
Thereafter the High Court granted a certificate on determination of the value of the suit property.
The only question which had to be decided by the District Court and the High Court was whether the property in dispute was a private Mandapam and not a public temple.
The District Judge appointed a Commissioner to submit a report regarding the physical features of the property.
The Commissioner reported that the suit premises was a temple and in front of it there was a Garbha Graha on either side.
There were two stone idols called Dwarabalakas.
The implements necessary for offering puja were also found by the Commissioner.
But there was no Dwejasthamba, Balipeeda or Gopuram.
There is no dispute, that the premises where the temple is situ.ate originally belonged to one Kuppiyan.
A decree was obtained by Tirumalaiyyan against Kuppiyan and in execution of that decree the property was put to sale by public auction.
It was purchased by Tirumalaiyyan in 1885 (vide Ext.
B 1 extract from the suit register dated 14 1 1885).
The title to the property thus vested in Tirumalaiyyan and the members of the family who later on came to be known as Thoguluva family.
The case laid in the plaint was that the Mandapam came to be constructed on the suit property by the members of that (1) 5 87 family which belonged to what is known as the Saurashtra community in Madurai town.
It was a private Mandapam which was in the exclusive and absolute control of the said family and worship was performed there for the spiritual benefit of the members of the Thoguluva Tirumalaiyyam family.
, It is common ground that at all times the management and control over the Mandapam was with some or other members of the Thoguluva family.
In 1932 or 1933 some shops in the eastern and western side of the Mandapam were constructed for which the Municipality levied a tax which had been paid by the members of the Thoguluva family which was in the management of the temple.
The learned District Judge 's approach to the appreciation of the evidence, oral as well as documentary, was on the prin ciple that once the private character of the temple was established more strong proof was necessary to hold that the temple was subsequently dedicated to the public; (Babu Bhagwan Dill & Others vs Gir Har Saroop & Others(1).
He considered the evidence produced by the parties and, in particular, carefully analysed the evidence led on behalf of the defendants according to whom the Mandapam was a public temple.
While discussing the evidence of each of the witnesses the learned judge gave detailed reasons for accepting or rejecting the evidence of a particular witness.
Before him the defendant had sought to establish the dedication of the temple to the public by producing evidence on the following points : (1) Subscriptions were collected by G. Rama Ayyangar and his descendants from the public because the members of the Thoguluva family stopped giving any financial help to the temple; (2) Shops in the front Mandapam were constructed with public donations and even for the Kumbabishekan public funds were collected; (3) D.W. 6 who did not belong to the Thoguluva family was doing the Mandagapadi; (4) There used to be a procession on Vaikunta Ekadasi day the expenses of which were met by D.W. 7; (5) There were jewels and other articles used for worship donated by members of public which were in the custody of Srimathigal Sangam; (6) On each of the Navaratri days people who did not belong to the Thoguluva family did the Ubhayam; (7) The worshippers had been making offerings during the daily pooja as of right and were participating in the daily Neivedyams, (8) That there was a Nagara, bell and Hundial in the suit temple; (9) That there was Utsava idol in the suit Mandapam, The learned District Judge found : D.Ws. 3, 4 and 8 who belonged to the Thoguluva family had played into the hands of the opposite camp.
(ii) D.W. 3 was disbelieved mainly because 67 I.A.P.I. 588 he claimed that he was the Manager for some time and that he had handed over all the charge papers and account books to the plaintiff at the meeting at which the plaintiff was appointed manager.
But in a previous tatement Ext.
A 17 he had admitted that there was no record to show that he had handed over the charge to the plaintiff.
(iii) The burden of proving that donations were collected from the public was on the defendants as they were seeking to establish dedication of a temple which was once private in character.
There was no satisfactory evidence that donations had ever been collected from members of the public.
2 and 6 who claimed to have made such contribution could not produce any account books which contained any such entries although they were running trade and business.
(iv) There were clear contradictions in the statements of DWs.
4 and 8 on some material matters and therefore their evidence could not be relied upon.
(v) The evidence of P.W. 1 read with the recitals in Ext.
B 5 negatived any inference of any public donation having been collected for the building of the shops or for the Kumbabishekam.
(vi) The statements of DWs.
7 & 8 when considered in the light of the other evidence did not establish that the deity was taken out in a procession as alleged by the defendants.
(vii) It had not been satisfactorily proved that any non Thoguluva performed any of the Mandagapodies on Navaratri day or that any monies were so collected for taking the deity in procession on Vaikunta Ekadasi day.
(viii) The evidence of D.Ws. 2 and 6 on the question of the expenses of the Nagara, bell and Hundial was negatived by the absence of their mention in the report of the Commissioner.
There was no mention of the Hundial even in some earlier affidavits or petitions.
(ix) Even defendants 2 and 3 did not say in their written statements that there had been any user of the temple by the public as of right.
They had only asserted that members of the Saurashtra public were worshipping there as of right.
It was pointed out by the learned judge that a temple worshipped even by a section of the public would be a public temple but the evidence which had been produced on behalf of the defendants was to the effect that any member of the public whether a Saurashtra or a non Saurashtra had a right to workship there.
The case as laid in the pleadings and as developed in the evidence was thus inconsistent.
The High Court observed that the origin and history of the shrine could not be traced with any degree of continuity owing to the paucity of the evidence on the record.
Reference was, however, made to the auction sale.
It was not disputed before the High Court that the property formed the subject matter of the court sale comprised the suit property.
Before the High 589 Court the plaintiff relied on Ext.
B 1 for two purposes : (1) It showed that the property was private secular property and (2) the title to the property became vested in Thoguluva Tirumalliyan and members of his family.
The observation of the High Court on these contentions was, "the document, Ext.
B 1 (a) lends considerable support to these contentions of the plaintiff".
The High Court, however, proceeded to note that in the description of the property in Ext.
B 1 there was a mention of Garbha Graha Prakaram and vacant site etc.
These terms were generally associated with only public temples.
According to the High Court there was no evidence to show how the worship at the shrine was conducted and who provided the necessary funds and further how the property was treated by the public authorities like the Government or the Municipality.
It was common ground, however, that the shrine was a popular one at least among the members of the Saurashtra community and that Nithyapadi pooja was being performed at the shrine just as in public temples.
Par ticular reference was made by the High Court to the expenses of stone images which were to be installed in the suit premises in 1947 the offer of the gift having been made by persons who did not belong to the Thoguluva family.
In Ext.
B 4 the donors offered to make three stone images at their cost and also offered a sum of Rs. 350/ for meeting all expenses in connection with the installation of newly made idols and the various ceremonies which were to be performed in connection with the same.
An invitation Ext.
B 5 was issued in that connection for a Mahakumbabishakam to be celebrated on January 27, 1947.
In this, invitation the plaintiff styled himself as the Honorary Secretary.
The donors were described therein as the Udhayadars.
On March 17, 1947 the plaintiff wrote to the donors requiring them to pay Rs. 100/ every month towards the pooja at the shrine.
This demand was said to have been made on the basis of the alleged agreement on the part of the donors to furnish the necessary expenses for running the institution after the images were duly installed.
The High Court felt that it was difficult to conceive of the owner of a private temple receiving gifts of images from strangers and installing them in his temple; and it was impossible to reconcile the demand for contributions with the claim that the temple was a private one.
The High Court next proceeded to reproduce a summary of the statement of each of the witnesses produced by the defendants.
No attempt whatsoever was made to discuss the reasons which the learned District Judge had given for not accepting their evidence except for a general observation here and there that nothing had been suggested in the cross examination of a particular witness as to why he should have made a false statement.
We apprehend that the uniform practice in the matter of appreciation of evidence has been that if the trial court has given cogent and detailed 590 reasons for not accepting the testimony of a witness the appellate court in all fairness to it ought to deal with those reasons before proceeding to form a contrary opinion about accepting the testimony which has been rejected by the trial court.
We are, therefore, not in a position to know on what grounds the High Court disagreed with the reasons which prevailed with the learned District Judge for not relying on the evidence of the witnesses produced by the defendants.
It seems that the approach of the High Court was also some what influenced by the observations of the Judicial Committee of the Privy Council in Mundancheri Koman vs Achuthan Nair & Others(1) that in the greater part of the Madras Presidency private temples were practically unknown and the presumption was that the temples and their endowments formed public religious trusts.
This was, however, not the case in Malabar where large tarwads often established private temples for their own use.
Finally the High Court held that the temple was a public temple.
After stating some other facts which were found, presumably after believing the evidence produced by the defendant, the High Court made two observations which may be reproduced : (1) "Admittedly the members of the public have been worshipping at the shrine without let or hindrance.
The evidence on record shows unmistakably that this temple was being run only by contributions and by benefactions obtained from members of the public." Mr. Natesan who appears for the plaintiff appellant has assailed the whole approach of the High Court to the question of the character of the temple which, according to him, had been proved to be private in origin.
It has been contended by him that the usual state of affairs to be found in Madras as per the observations of the Privy Council could not be applied to the case of Saurashtra community which migrated from the territories which now form part of the State of Gujarat centuries ago.
This community, has, apart from several other individual characteristics, maintained a tradition of having private temples.
Moreover if the origin of the temple had been proved to be private then according to the law I aid down by the Privy Council itself in Babu Bhagwan Din 's case dedication to the public was not to be readily inferred.
Such an inference, if made, from the fact of user by the public was hazardous since it should not, in general, be consonent with Hindu sentiment or practice that worshippers should be turned away; and, as worship generally implied offer (1) 61 T.A. 405.
591 ings of some kind, it was not to be expected that the managers of a private temple should in all circumstances desire to discourage popularity.
It was further emphasised by their lordships that the value of public user as evidence of dedication depends on the circumstances which give strength to the inference that the user was as of right.
In Goswami Shri Mahalaxmi Vahuii vs Rannchboddas Kalidas & Others(1) it was pointed out that the appearance though a relevant circumstance was by no me= decisive.
The circumstance that the public or a section thereof had been regularly worshipping in the, temple as a matter of course and they could take part in the festivals and ceremonies conducted in that temple apparently as a matter of right was a strong piece of evidence to establish its public character.
if votive offerings were being made by the public and the expenses were being met by public contribution, it would be safe to presume that the temple was public.
In short the origin of the temple the manner in which its affairs were managed the nature and extent of the gifts received by it, rights exercised by devotees in regard to worship therein, the consciousness of the manager and the consciousness of the devotees themselves as to the public character of the temple were factors that went to establish whether a temple was public or private.
Mr. Natesan says that if the evidence of the witnesses pro duced by the District Judge then there will be hardly any features or circumstances barring some of the physical features of the temple and the fact that people have been allowed to worship and take part in the festivals and ceremonies and even to make some offerings, (though without their having the right to worship in the temple) which would be sufficient to make a temple which was private in origin a public temple.
According to Mr. Natesan even the witnesses of the defendants had shown consciousness of the temple beng private.
He has laid a great deal of emphasis on the absence of any property attached to the temple which might be endowed.
He says that admittedly only two shops were build by the family and out of the rents received from those shops together with other contributions made by the members of the family the expenses of the temple were being met.
He has relied a great deal on the decision of a Division Bench, of the Madras High Court in The Madras Hindu Religious En dowments Board vs V. N. D. Ammal(1).
There reliance had been placed on the following features : (1) that when the temple was built in 1919 Kumbabishekam was performed on a grand scale; (2) the respondent had made Utsavamurthis and built Chaprams and the deities were also taken in procession on spe (1) [1970]2 S.C.R. 275. (2) [1953] 2 M.I.J. 688. 592 cial occasions; (3) a Gurukkal had been, engaged to perform the pooja regularly and (4) the temple has got a Gopuram and other features which are usually found in a public temple.
This is what Venkatarama Ayyar J., as he then was, observed : "It is true that the facts that there is an utsava idol and there are processions are generally indicative of the fact that it is a public temple.
But then no property has been dedicated for the upkeep of the temple.
The worship is maintained and the expenses are met from out of the private funds of the respondent.
In the absence of any property being dedicated for the maintenance of worship in the temple, it is difficult to hold that, the temple has been dedicated to the public".
At this stage the provisions of section 9 (12) of the Madras Act 2 of 1927 which defines a temple may be noticed.
According to that definition it is a place by whatever designation known used as a place of public religious worship and dedicated or used as of right by the Hindu community or any section thereof as a place of public religious worship.
In the Madras Hindu Religious and Charitable Endowments Act (Act 22 of 1959) the definition of "temple" is given in sub clause (20) of section 6.
It is practically in the same terms as in the earlier Act.
In our judgment the, High Court was in error in holding that members of the public had been worshipping at the Mandapam in dispute without let or hindrance.
In arriving at that conclusion it appears to have believed the witnesses produced by the defendants.
It has also relied on the principle that in the absence of any evidence to show that such user was permissive it could be presumed that, it was as of right.
We have already pointed out that the High Court, while appraising the evidence of the witnesses, has not discussed the reasons and grounds given by the learned District Judge for not relying on the defendant 's witnesses.
Mr. A. V. Rangam who appears for the contesting respondent has endeavoured to take us through the evidence of the witnesses for demonstrating that the reasons given by the card the testimony of the defendants witnesses.
But we are learned District Judge were neither cogent nor sufficient to disunable to agree with him that the appreciation of evidence by the learned Judge was open to criticism as suggested by him.
Apart from this the High Court did not consider the evidence produced by the plaintiff without which many matters could not be properly appreciated or explained.
The other finding of the ' High Court that the temple was being run by contributions and benefactions obtained from members of the public was also based mainly on the evidence produced by the defendants.
In our 593 opinion the conclusion of the learned District Judge on that point receives more support from the entire material on the record It is significant that the High Court did not attach sufficient importance to three matters which, in the present case, were of material consequence.
The first was that the origin of the Mandapam had been proved to be private.
The second was that its management had remained throughout in the members of the Thoguluva family.
The third was the absence of any endowed property.
There was no Gopuram or Dwajasthamba nor a Nagara bell nor Hundial in the suit temple.
The learned District Judge adverted to the evidence, on all these and other relevant matters and we concur with him in his conclusions.
It is true that the suit temple had some physical characteristics and features which are generally to be found in a public temple.
It was also established that persons who were outsiders in the sense that they did not belong to the Thoguluva family used to come and worship at the temple and made offerings there.
There were also some jewels and other articles in the temple.
But the determination of the question whether the temple was public or private did not depend on some facts or set of facts alone.
The entire evidence, both documentary and oral, had to be, considered as a whole keeping in view the principles already noticed by us.
We are satisfied that the learned District Judge came to the correct conclusion that the suit temple was private in character.
For all the above reasons the appeal is allowed, the judg ment of the High Court is set aside and that of the District Judge restored.
The appellant will be entitled to costs in this Court.
Appeal allowed.
[/INST]The respondent, a partnership firm of which the second respondent was a partner, carried on business as manufacturers of bidis at various places in the State of Madhya Pradesh.
Being unable to secure sufficient tendu leaves locally, the firm took leases for the collection of such leaves in Bihar & Maharashtra.
They actually imported tendu leaves under two railway consignments from Bihar.
They informed the Divisional Forest Officer about the same and asked permission for transport of the leaves and to utilise them in their factories.
By letter, the D.F.O. informed the respondents that the leaves must not be moved for bidi manufacture until permission is given.
Respondents obeyed the order; but in spite of that, the Sub divisional Forest Officer seized two quantities of such leaves and filed a complaint alleging contravention of section 5 of Madhya Pradesh Tendu Patta (Vyapar Viniyaman) Adhiniyam, 1964.
The respondent filed a petition under article 226 of the Constitution for a writ of certiorari quashing the complaint.
The contention of the respondents was that the Act did not prohibit import of tendu leaves from outside nor was there any restriction on a manufacturer to consume the same for the manufacture of bidis or the Rules made under the Act did not regulate the transport of the tendu leaves imported from outside.
The State however, contended that transport of tendu leaves whether grown locally or imported from outside was completely prohibited under section 5 of the Act, except by a license holder in terms of a permit issued.
S.5(1) provides that no person other than the State Government or an Officer of the State Government etc.
shall purchase or transport tendu leaves.
Further, the Act did not prohibit import of tendu leaves and so the Act is not violative of articles 31, 301 and 304 of the Constitution and the control of movement of tendu leaves after their import was in no way repugnant to articles 301 and 304 of the Constitution.
The State contended that unless the State had the power to check the purchase of tendu leaves from outside the State and to restrict the transport thereof within the State, the monopoly of State trading in tendu leaves would not be effective.
The High Court rejected these contentions of the State and hence the appeal.
Dismissing the appeal, HELD : (1) All the relevant provisions of the Act and the rules made thereunder show that the legislature intended that everybody growing leaves within the State should offer the same to it to its agents in different units for sale and the State was bound to purchase every single lot of usable tendu leaves.
Prima facie trade in tendu leaves could consist of dealing in those leaves, i.e., their purchase and sale but transport 'of the leaves once purchased or sold would not prima facie be an organic or integral part of dealing in those leaves.
[842 D] 839 Vrajlal Manilal vs M.P. State ; , followed.
(ii) In the present case, the transport of tendu leaves purchased outside but consigned to places within the State to be used for the manufacture of bidis is not integrally connected with the State monopoly as envisaged in the Act.
The Act ought not to be construed so as to ban import of tendu leaves from outside the State or restrict their movement once they are within the State unless clear language was used in that behalf.
[844 C] Akadasi Padhan vs State of Orissa, [1963] Supp. 2 S.C.R. 691, referred to.
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<s>[INST] Summarize the judgementCivil Appeal No. 3844 of 1983.
Appeal by Special leave from the Judgment and Order dated the 25th July, 1980 of the Delhi High Court in L.P.A. No. 89 of 1976.
A.K. Gupta for the Appellant.
G.B. Pai, S.N. Bhandari and Ashok Grover for Respondent.
No. 3.
R.N. Poddar for Respondent No. 1.
The Judgment of the Court was delivered by 951 CHINNAPPA REDDY, J.
It was just the other day that we were bemoaning the unbecoming devices adopted by certain employers to avoid decision of industrial disputes on merits.
We noticed how they would raise various preliminary objections, invite decision on those objections in the first instance, carry the matter to the High Court under article 226 of the Constitution and to this Court under article 136 of the Constitution and delay a decision of the real dispute for years, sometimes for over a decade.
Industrial peace, one presumes, hangs in the balance in the meanwhile.
We have now before us a case where a dispute originating in 1969 and referred for adjudication by the Government to the Labour Court in 1970 is still at the stage of decision on a preliminary objection.
There was a time when it was thought prudent and wise policy to decide preliminary issues first.
But the time appears to have arrived for a reversal of that policy.
We think it is better that tribunals, particularly those entrusted with the task of adjudicating labour disputes where delay may lead to misery and jeopardise industrial peace, should decide all issues in dispute at the same time without trying some of them as preliminary issues.
Nor should High Courts in the exercise of their jurisdiction under article 226 of the Constitution stop proceedings before a Tribunal so that a preliminary issue may be decided by them.
Neither the jurisdiction of the High Court under article 226 of the Constitution nor the jurisdiction of this Court under article 136 may be allowed to be exploited by those who can well afford to wait to the detriment of those who can ill afford to wait by dragging the latter from Court to Court for adjudication of peripheral issues, avoiding decision on issues more vital to them.
article 226 and article 136 are not meant to be used to break the resistance of workmen in this fashion.
Tribunals and Courts who are requested to decide preliminary questions must therefore ask themselves whether such threshold part adjudication is really necessary and whether it will not lead to other woeful consequences.
After all tribunals like Industrial Tribunals are constituted to decide expeditiously special kinds of disputes and their jurisdiction to so decide is not to be stifled by all manner of preliminary objections journeyings up and down.
It is also worth while remembering that the nature of the jurisdiction under article 226 is supervisory and not appellate while that under article 136 is primarily supervisory but the Court may exercise all necessary appellate powers to do substantial justice.
In the exercise of such jurisdiction neither the High Court nor this Court is required to be too astute to interfere with the exercise of jurisdiction by special tribunals at interlocutory stages and on preliminary issues.
952 Having sermonised this much, we may now proceed to state the facts which provoked the sermon.
The appellant D.P. Maheshwari was an employee of Toshniwal Brothers Pvt. Ltd., when his services were terminated with effect from 28th July 1969.
He raised an industrial dispute and on 3rd July 1970 the Lt. Governor of Delhi referred the dispute for adjudication to the Additional Labour Court Delhi under sections 10(1)(c) and 12(5) of the Industrial Disputes Act.
The dispute referred for adjudication to the Labour Court was, "Whether the termination of services of Shri D.P. Maheshwari is illegal and/or unjustified and if so to what relief is he entitled and what directions are necessary in this respect ?" The Management straightaway questioned the reference by filing Writ petition No. 159 of 1972 in the Delhi High Court.
The writ petition was dismissed on 22nd May 1972.
Thereafter the management raised a preliminary contention before the Labour Court that D.P. Maheshwari was not a 'workman ' within the meaning of Section 2(s) of the Industrial Disputes Act and the reference was therefore incompetent.
The Labour Court tried the question whether D.P. Maheshwari was a workman as defined in Section 2(s) of the Industrial Disputes Act as a preliminary issue.
Both parties adduced oral and documentary evidence.
After referring to the evidence of the employee 's witnesses the Labour Court said, "Thus according to the evidence of the claimant 's witnesses the claimant was employed mainly for clerical duties and he did discharge the same." The Labour Court then referred to the evidence of the witnesses examined by the management and said, "Thus the said evidence falls far short of proving that the claimant was in fact discharging mainly Administrative of supervisory duties." The Labour Court then proceeded to refer to the documents produced by the management and observed, "Thus the documents filed by the respondent do not go to show that the real nature of the duties discharged by the claimant was supervisory or administrative in nature." The Labour Court next referred to what it considered to be an admission on the part of the management who had classified all their employees into three separate classes A, B and C, Class A described as 'Managerial ' Class B described as 'Supervisory ' and Class C described as 'Other Staff '.
The name of D.P. Maheshwari was shown in Class C. After reviewing the entire evidence the Labour Court finally recorded the following finding: "From the above discussion, it is clear that the claimant 's evidence shows that he was doing mainly 953 clerical work of maintaining certain registers preparing drafts and seeking instructions from the superiors and respondents ' lawyers during the period of his services though designated Accounts Officer or officer in special duty or store purchase officer . . . . . . . . . . . . . . . . . . .
As a result, in my opinion it has to be held that the nature of the main duties being discharged by the claimant was clerical and not supervisory or administrative despite his designation as officer.
Accordingly, he has to be held to be a workman under section 2(s) of the Industrial Dispute Act.
" The management was dissatisfied with the decision of the Labour Court on the preliminary issue.
So, they invoked the High Court 's extra ordinary jurisdiction under article 226 of the Constitution.
A learned single judge of the High Court, by his judgment dated 12th July 1976 allowed the Writ Petition and quashed the order of the Labour Court and the reference made by the Government.
A Division Bench of the High Court affirmed the decision of the Single Judge on 25th July 1980.
The matter is now before us at the instance of the workman who obtained special leave to appeal under article 136 on 4th April 1983.
The services of the workman were terminated on 28th July 1969.
A year later the dispute was referred to the Labour Court for adjudication.
Thirteen years thereafter the matter is still at the stage of decision on a preliminary question.
In our view, further comment is needless.
Shri A.K. Gupta, the learned counsel for the appellant submitted that the High Court literally exercised appellate powers and recorded findings of fact differing from those recorded by the Labour Court and this, he complained, had been done by an unfair reading of the order of the Labour Court and without the High Court itself considering a single item of evidence or document.
We are afraid there is considerable force in Shri Gupta 's criticism.
Curiously enough, the Learned Single Judge of the High Court affirmed the finding of the Labour Court that D.P. Maheshwari was not employed in a supervisory capacity.
He said, "In the face of this material and the admitted hypothesis the conclusion that the respondent was not 954 mainly employed in a supervisory capacity is certainly a possible conclusion that may be arrived at by any Tribunal duly instructed in the law as to the manner in which the status of an employee may be determined.
It is, therefore, not possible for this Court to disturb such a conclusion having regard to the limited admit of review of the impugned order." Having so held, the Learned Single Judge went on to consider whether the workman was discharging duties of a clerical nature.
He found that it would be difficult to say that D.P. Maheswari was discharging 'routine duties of a clerical nature which did not involve initiative, imagination, creativity and a limited power of self direction. ' The Learned Single Judge did not refer to a single item of evidence in support of the conclusions thus recorded by him.
He appeared to differ from the Labour Court on a question of fact on the basis of a generalisation without reference to specific evidence.
No appellate court is entitled to do that, less so, a court exercising supervisory jurisdiction.
Referring to the finding of the Labour Court that the workman was discharging mainly clerical duties the Learned Single Judge observed, "It is erroneous to presume, as was apparently done by the Additional Labour Court, that merely because the respondent did not perform substantially supervisory functions, he must belong to the clerical category.
" This was an unfair reading of the Labour Court 's judgment.
We have earlier extracted the relevant findings of the Labour Court.
The Labour Court not only found that the workman was not performing supervisory functions but also expressly found that the workman was discharging duties of a clerical nature.
The Division Bench which affirmed the judgment of the Learned Single Judge also read the judgment of the Labour Court in a similar unfair fashion and observed.
" It is no doubt true that the Labour Court held that the appellant 's evidence showed that he was doing mainly clerical work.
As we read the order as a whole it appears that in arriving at this conclusion the Labour Court was greatly influenced by the fact that the appellant was not employed in a supervisory capacity.
" We have already pointed out that the Labour Court did not infer that the appellant was discharging duties of a clerical nature from the mere circumstance that he was not discharging supervisory functions.
The Labour Court considered the entire evidence and recorded a positive finding that the appellant was 955 discharging duties of a clerical nature.
The finding was distinct from the finding that the appellant was not discharging supervisory function as claimed by the company.
We would further like to add that the circumstance that the appellant was not discharging supervisory functions was itself a very strong circumstance from which it could be legitimately inferred that he was discharging duties of a clerical nature.
If the Labour Court had drawn such an inference it would have been well justified in doing so.
But, as we said, the Labour Court considered the entire evidence and recorded a positive finding that the workman was discharging duties of a clerical nature.
The Division Bench, we are sorry to say, did not consider any of the evidence considered by the Labour Court and yet characterised the conclusion of the Labour Court as perverse.
The only evidence which the Division Bench considered was that of M.W.I.Shri K.K. Sabharwal and under the impression that the Labour Court had not considered the evidence of K.K. Sabharwal, the Division Bench observed.
"The non reference to the said evidence while discussing the point in issue, would clearly vitiate the order to the Labour Court.
" This was again incorrect since we find that the Labour Court did consider the evidence of M.W.I fully.
Shri G.B. Pai, Learned Counsel for the company, drew our attention to the qualifications of the appellant and certain letters written by him to the Managing Director and argued that the qualifications and the letters indicated that the appellant was discharging duties, not of a clerical nature but those of a senior executive closely in the confidence of the Managing Director.
We are enable to agree with Mr. Pai.
First, we are not prepared to go behind the finding of fact arrived at by the Labour Court which certainly was based on relevant evidence and next, all that we can say from the qualifications and the letters is that the appellant was occasionally deputed by the Managing Director to undertake some important missions.
The question is what were his main duties and not whether he was occasionally entrusted with other work.
On that question, the clear finding of the Labour Court is that he was mainly discharging duties of a clerical nature.
We are clearly of the opinion that the High Court was totally unjustified in interfering with the order of the Labour Court under article 226 of the Constitution.
We set aside the judgments of the Learned Single Judge and the Division Bench of the Delhi High 956 Court, restore the order of the Additional Labour Court and direct the Additional Labour Court to dispose of the reference within a period of three months from the date of communication of this order to that Court.
That appellant is entitled to his costs which we stipulate at Rupees five thousand.
H.L.C. Appeal allowed.
[/INST]An industrial dispute concerning the termination of services of the appellant in 1969 was referred for adjudication by the Labour Court under sections 10 (1) (c) and 12 (5) of the Industrial Disputes Act in the year 1970.
The Management of the company in which he was employed questioned the reference itself by filing a petition under article 226 and when it was rejected, the Management raised a preliminary contention before the Labour Court that the appellant was not a 'workman ' and therefore the reference was incompetent.
The Labour Court, after a detailed and careful examination of the oral and documentary evidence produced by both the appellant and the Management came to the conclusion that the appellant was a 'workman ' under section 2 (s) of the Act as he was employed mainly for clerical duties.
This finding was challenged by the Management once again by filing a petition under article 226 and a Single Judge of the High Court allowed the same and quashed the order of the Labour Court as well as the reference made by the Government.
On his appeal having been rejected by a Division Bench of the High Court, the appellant approached this Court under article 136.
Allowing the appeal, ^ HELD: The nature of jurisdiction under article 226 is supervisory and not appellate while that under article 136 is primarily supervisory but the Court may exercise all necessary appellate powers to do substantial justice.
In the exercise of such jurisdiction neither the High Court nor this Court is required to be too astute to interfere with the exercise of jurisdiction by special tribunals at interlocutory stages and on preliminary issues.
[951 G H] Tribunals like Industrial Tribunals are constituted to decide expeditiously special kinds of disputes and their jurisdiction to so decide is not to be stifled by all manner of preliminary objections and journeyings up and down.
Tribunals and Courts who are requested to decide preliminary questions must 950 ask themselves whether such threshold part adjudication is really necessary and whether it will not lead to other woeful consequences.
There was a time when it was thought prudent and wise to decide preliminary issues first.
But the time appears to have arrived for a reversal of that policy.
It is better that tribunals, particularly those entrusted with the task of adjudicating Labour disputes where delay may lead to misery and jeopardise industrial peace, should decide all issues in dispute at the same time without trying some of them as preliminary issues.
Nor should High Courts in the exercise of their jurisdiction under article 226 stop proceedings before a Tribunal so that a preliminary issues may be decided by them.
Neither the jurisdiction of the High Court under article 226 nor the jurisdiction of this Court under Art 136 may be allowed to be exploited by those who can well afford to wait to the detriment of those who can ill afford to wait by dragging the latter from Court to Court for adjudication of peripheral issues, avoiding decision on issues more vital to them.
Articles 226 and 136 are not meant to be used to break the resistance of workmen in this fashion.
[951 F, C D] The instant case relates to a dispute originating in 1969 and referred for adjudication in 1970 which is still at the stage of decision of a preliminary objection.
The Labour Court considered the entire evidence and recorded a positive finding that appellant who was discharging duties of a clerical nature was a 'workman '.
The Single Judge of the High Court did not refer to a single item of evidence while reversing the finding of the Labour Court.
He appeared to differ from the Labour Court on a question of fact on the basis of a generalisation without reference to specific evidence.
The Division Bench which affirmed the judgment of the Single Judge also read the judgment of the Labour Court in a similar unfair fashion and did not consider any of the evidence considered by the Labour Court and yet characterised the conclusion of the Labour Court as perverse.
No appellate Court is entitled to do that less so, a Court exercising supervisory jurisdiction.
[951 C, 953 B, 954 C D, 955 C]
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<s>[INST] Summarize the judgementCivil Appeal No. 2104 of 1969.
Appeal by Special Leave from the Judgment and order dated the 27th February, 1969 of the Industrial Tribunal, Bihar, Patna in reference No. 54 of 1966.
section V. Gupte and U. P. Singh for the Appellant.
E A. K. Nag and D. P. Mukherjee for Respondents.
The Judgment of the Court was delivered by ALAGIRISWAMI, J.
This appeal is by special leave granted by this Court against the award of the Industrial Tribunal, Bihar at Patna in reference No. 54 of 1966 made by the Government of Bihar on 25th November, 1966.
The special leave granted is limited only to the question whether there should be a contributory provident fund scheme on the basis of basic wages or total wages.
It was noted at the time of granting the special leave that the appellant Board is willing to extend that scheme to all the workers except the Government servants who are on deputation and those to whom the Employees Provident Fund Act applies.
Therefore the only item in reference No. 54 of 1966 which is relevant for the purpose of this appeal is the following: "Whether the benefit of the Employees ' Provident Fund Act, 1952 should be extended to any additional categories of workmen ? If so, what should be the terms and conditions and from what date ?" The Employees ' Provident Fund Act applies only to establishments which are factories.
It could be applied to establishments which are not factories if the Central Government by notification in the official 44 Gazette specifies in this behalf.
The industry in question" electricity including the generation, transmission and distribution thereof, is on to which the Act applies.
But as is well known only a small proportion of employees connected with the generation of electricity is in establishment which are factories.
The transmission and distribution is all over the State and the employees concerned with transmission and distribution and the maintenance of those lines of transmission and distribution are spread all over the State and probably far outnumber those working in establishments which are factories.
To them the Employees ' Provident Fund Act does not apply.
The Board maintains a Contributory Provident Fund where the contribution is on the basis of basic wage, the Board and the employees contributing equally.
The workmen claimed that all workmen of the Board should have the same and similar benefits and that therefore there should be no distinction between the Board 's Contributory Provident Fund scheme and the scheme under the Employees Provident Fund Act.
Moreover, the contribution under the Act is 8 per cent whereas under the Board 's scheme it is 6.25 per cent.
The employees also contended that the services of the workmen of the Board are liable to be transferred from one establishment to another both which may not he covered by the same scheme under the Act and therefore it will bring about serious injustice if they are deprived of their benefits under the Act, and such anomalies will be removed by making the benefits under both the schemes similar.
The Board 's contention was that this would impose additional financial liabilities which the Board would not be able to bear.
Therefore, the main question which the Tribunal had to consider was the Board 's financial capacity to implement the Provident Fund scheme as demand: ed by the workmen.
It seems to have been argued on behalf of the workmen that the State Government is the financier of the Board which charges interest now at the rate of 6.25 per cent as against the previous 4 per cent per annum.
It, was also contended that no scheme run by the Board was running at a loss.
Exhibit 17, purported to contain trading results of the Board., was shown to the Tribunal and it was argued that in the year ending March 1969 Board 's gross profits amounted to Rs. 305.12 lakhs and it had been continuously rising from Rs. 59.39 lakhs in 1961.
Exhibit 18 shows the loans which have been received from the Government by the Board and the balance sheet shows a very large amount in the shape of interest payable to the Government.
It was argued on behalf of the Union that this amount should be taken as dividend to be paid to the Government by the Board and should not be taken into consideration while deciding matters regarding benefits to be made available to its employees.
The validity of none of these contentions was considered by the Tribunal.
It referred to an award made by it in 1964 in reference No. 19 of 1960 in which it had held that if the interests realised by the State were excluded from consideration, there would be surplus in favour of the Board.
In that award it had been pointed out that it had not been explained by the management how the depreciation had been calculated.
That award also pointed out that one of the main reasons for the deficits shown was heavy interest on the capital investment, that in an electrical establishment capital investments are heavy in the initial stages, that the Board expected that after the load developed fully the scheme would start giving adequate 45 profits.
The Tribunal thought that the position at present was not worse than what it was earlier and that therefore the Board should extend the benefits of the Contributory Provident Fund to all workmen other than those who are covered by the Act.
It therefore ordered that the contribution should be 6.25 per cent but not on the basic wages but on the total wages.
The Tribunal has treated the whole matter in a very perfunctory manner.
The main question for consideration by the Tribunal was the financial capacity of the Board.
It has made no effort at all to analyse the balance sheet of the Board to show the actual results of its working.
It has made no effort to work out the financial implications of its order.
It has not made it clear what exactly are the total wages.
In Gramophone Co. vs Its Workmen(1) it was held by this Court that: "Before the real profit for each of the relevant years is ascertained amounts to be provided for taxation and for development rebate reserve could not be deducted in order to ascertain the financial capacity of the employer.
In considering the question of provident fund and gratuity which stands more or less on the same footing the industrial tribunal has to look at the profits made without considering provision for taxation in the shape of income tax and for reserves.
The provision for income tax and for reserves must take second place as compared to provision for wage structure and gratuity, which stands on the same footing as provident fund which is also a retiral benefit.
Payment towards, provident fund and gratuity is expense to be met by an employer like any other expense including wages and if the financial position shows that the burden of payment of gratuity and provident fund can be met without undue strain on the financial position of the employer, that burden must be borne by the employer.
It will certainly result in some reduction in profits; but if the industry is in a stable condition and the burden of provident fund and gratuity does not result in loss to the employer that burden will have to be borne by the employer like the burden of wage structure in the interest of social justice.
While on the one hand casting of this burden reduces the margin of profit, on the other hand it will result in the reduction of taxation in the shape of income tax." That case was a case of an ordinary commercial concern.
Even so it was noticed that the stability of the industry as well as the fact that the burden of provident fund and gratuity does not result in loss to the employer are to be taken into consideration.
the actual burden was calculated and it was pointed out that 63 per cent of it would be met by reduction in taxation.
Nothing of the sort has been done by the Tribunal in this case.
It is true that in that case it was said that the amounts to be provided for taxation and for development rebate reserve could not be deducted in order to ascertain the financial capacity of the employer.
Nothing was said there about the depreciation reserve (1) [1964] II L. L. J.131.
46 which is obligatory under section 68 of the the Electricity Board is not an ordinary commercial concern.
It is a public service institution.
It is not expected to make and profit.
It is expected to extend the supply of electricity to unserved areas without reference to considerations of loss that might be incurred as a result of such extension.
The Government makes subventions to the Board for the purposes of the Act.
Section 59 of the Electricity supply Act, 1948 provides that as far as practicable and after taking credit for any subventions from the State Government the Board shall carry on its operations so as not to incur a loss.
Under section 64 the State Government may advance loans to the Board and under section 65 the Board itself has the power to borrow.
Under section 66 the State Government may guarantee the payment of principal and interest of any loan proposed to be raised by the Board.
Under section 67 after meeting its operating maintenance and management expenses and after provision has been made for the payment of taxes on its income and profits the revenues of the Board have to be distributed as far as they are available in the following order, namely: (i) interest on bonds not guaranteed under section 66; (ii) interest on stock not so guaranteed; (iii)credits to depreciation reserve under section 68; (iv) interest on bonds guaranteed under section 66: (v) interest on stock so guaranteed; (vi) interest on sums paid by the State Government under guarantees under section 66; (vii)the write down of amounts paid from capital under the proviso to sections 59; (viii)the write down of amounts in respect of intangible assets to the extent to which they are actually appropriated in any year for the purpose in the books of the Board; (ix) contribution to general reserve of an amount not exceeding one half of one per centum per annum of the original cost of fixed assets employed by the Board so however that the total standing to the credit of such reserve shall not exceed fifteen per centum of the original cost of such fixed assets; (x) interest on loans advanced or deemed to be advanced to the Board under section 64, including arrears of such interest: (xi) the balance to be appropriated to a fund to be called the Development Fund to be utilised for (a) purposes beneficial, in the opinion of the Board, to electrical development in the State; (b) repayment of loans advanced to the Board under section 64 and required to be repaid: 47 Provided that where no such loan is outstanding, one half of the balance aforesaid shall be credited to the Consolidated Fund of the State.
Section 68 lays an obligation on the Board to make a credit to the depreciation reserve in the prescribed manner.
The facile assumption by the Tribunal that the interest should No. be taken into account in working out the profits is not borne out by the provisions of the statute.
Indeed the Tribunal did not look into the Act at all.
Whether in view of the statutory obligations laid on ii under the various sections just now referred to in analysing the capacity of the Board to bear any additional burden in the matter of provident fund or other amenities the same considerations that applied in the case of private commercial concerns could be applied is a rather difficult question.
In fact the decision might very often depend on a close analysis of the financial condition of the Board.
We do not want at present to express one view or the other.
one thing at least is obvious, that the various sums payable under the provisions of section 67 have to be deducted before the profits could he ascertained.
Even with regard to the depreciation reserve the provisions of section 68 may have to be taken into account.
If it is not it would have to be met by loans on which interest will have to be paid and deduction of interest so paid will have to be taken into account in calculating the profits.
The contribution to the depreciation reserve is a statutory obligation and is a definite proportion whereas it is open to an ordinary commercial concern to credit any amount to the depreciation reserve.
These and other matters cannot be properly decided in the absence of a detailed examination of the finances of the Board.
That is why we said that the Tribunal has dealt with the matter in a perfunctory way.
It should.
be directed to dispose of the matter afresh in the light of the observations made in this judgment.
The appeal is accordingly allowed.
There will be no order as to costs.
P.H.P. Appeal allowed.
[/INST]Electricity Supply Act, 1948 section 59, 64, 65, 66 67 and 68.
The Employees Provident Fund Act applies only to establishments which are factories.
The industry in question electricity including generation, transmission and distribution thereof, is one to which the Act applies.
But only a small proportion of employees connected with the generation of electricity is establishments which are factories.
To the rest the Act does not apply.
The appellant maintains a contributory provident fund for those employees who are not covered by the Act where the contribution is on the basis of basic wage the appellant and the employees contributing equally.
The contribution under the Act is 8 per cent whereas under the appellant 's scheme it is 6.25 per cent.
The workmen respondents claimed before the Industrial Tribunal in a reference made by the Govt.
Of Bihar (1) that all workmen of the appellant should have the same and the similar benefits and that, therefore.
there should be no distinction between the appellant 's contributory provident fund scheme and the scheme under the Employees Provident Fund Act.
(2) The services of the workmen of the appellant are liable to be transferred from one establishment to another both of which may not be covered by the same scheme and such anomalies can be removed by giving the same benefits to all the workmen; (3) That the State was the financier of the appellant which now charges interest at the rate of 61 per cent as against previous 4 per cent; (4) That no scheme run by the Board was running at a loss; (5) That a large amount was paid to the Government by me appellant in the shape of interest towards the loans received from the Government and that such amounts should be taken as dividends to be paid to the Government by the appellant and should not be taken into consideration while deciding the matters regarding benefits to be made available to its employees.
The appellant contended before the Industrial Tribunal that the demand of the workmen would impose additional financial liabilities which the appellant would not be able to bear The Tribunal did not consider the validity of the above submissions It merely relied on an earlier award in which it was observed that if the interest realised by the Government were excluded from consideration there would be surplus in favour or the appellant.
The Tribunal held that since the position of the appellant was not worse than what it was at the time of the earlier award, the appellant should extend the benefits of the contributory provident fund to all workmen who are not covered by the Act and that the contributions should be 6.25 per cent not on the basic wages but on the total wages.
Allowing the appeal, ^ HELD: (1) The Tribunal has treated the whole matter in a very perfunctory manner.
The main question for consideration by the Tribunal was the financial capacity of the Board.
It has made no effort at all to analyse the balance sheet of the appellant to show the actual results of his working.
It has made no effort to work out the financial implications of its order.
It has not made it clear what exactly are the total wages.
This Court in the case of Gramophone Company.
although it was a case of ordinary commercial concern, calculated the actual burden to protect the stability of the industry and to see that the imposition of the burden does not result in loss to the employer.
43 (2) The appellant is not an ordinary commercial concern.
It is a public service institution.
lt is not expected to make any profits.
It is expected to extend the supply of electricity to unserved areas without reference to considerations of loss that might be incurred is a result of such extension.
Section 59 of the provides that as far as practicable The Board shall carry on its operations so as not to incur loss.
section 64 enables the State Government to advance loans to the Board.
section 65 authorises the Board to borrow.
section 66 authorises the State Government to guarantee loans raised by the Board.
section 67 lays down the manner in which the profits have to be distributed.
section 68 imposes obligation on the Board to make a credit to the depreciation reserve in the prescribed manner.
[46 A C].
The assessment by the Tribunal that the interest should not be taken into account in working out the profits is not borne out by the provisions of the statute.
The Tribunal did not look into the Act at all.
Whether in view of the statutory obligations laid on the appellant under the aforesaid sections whether the same considerations which apply in the case of private commercial concerns could be applied to the Board while analysing the capacity to bear the additional burden is rather a difficult question.
We do not express any view on that question.
However various sums payable under section 67 have to be deducted before the profits could be ascertained and with regard to depreciation reserve, the provision of section 68 may have to be taken into account.
[47 C E].
The matter was remanded back to the Tribunal to be disposed of in the light of the observations made in the judgment.
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<s>[INST] Summarize the judgementN: Criminal Appeal No. 718 of 1979 From the Judgment and Order dated 11 10 1979 of the Gujarat High Court in Criminal Appeal No. 110/77.
A.K. Trivedi and S.S. Khanduja for the Appellant.
The Judgment of the Court was delivered by FAZAL ALI, J.
This appeal is preferred by the three accused in Sessions Case No. 46 of 1976 against their conviction and sentence 354 imposed upon them by the High Court under the .
The three appellants were tried by the Sessions Judge for commit ting offences punishable under section 302/120 B/323/324 read with section 34 and 109 of the Indian Penal Code for committing the murder of one Karsan Kala on 19 1 1976.
The learned Sessions Judge acquitted all the three appellants of the charges levelled against them.
The State of Gujarat filed an appeal against the order of Sessions Judge acquitting them, to the High Court of Gujarat.
A division Bench of the High Court in Criminal Appeal No. 110/77 allowed the appeal of the State and reversed the order of acquittal by the Learned Sessions Judge and convicted them for offences under section 302/120 B and sentenced them to imprisonment for life.
They were also convicted tor lesser offences and sentenced to varying terms of imprisonment The prosecution strongly relied on the evidence of three eye witnesses Rata Mala, Ganesh and Ruda.
Rata Mala was an injured eye witness having receives several incised injuries.
The evidence of Ruda not accepted.
The complainant Savai Kala, the brother of the deceased saw the latter part of the occurrence when the deceased was being carried away by the accused.
When Savai Kala questioned, the accused attacked him and he was also injured The High Court in an elaborate judgment after thoroughly scrutinising the evidence of the eye witnesses accepted their testimony.
It observed that the evidence of the eye witnesses Rata Mala is most reliable and trustworthy and so also the evidence of Ganesh.
The High Court has referred to the circumstance under which the order of acquittal could be interfered 1, with in the light of the various decisions of this Court.
The High Court taking into consideration the reasons given by the Sessions Judge for not accepting the testimony of the eye witnesses found them to be totally unacceptable.
We have been taken through the evidence of the material witnesses.
We have no hesitation in agreeing with the conclusion arrived at by the High Court that the reasons given by the l rial Court for acquitting the accused are totally unacceptable.
After hearing the learned counsel and examining the petition of appeal and after going through the relevant parts of the judgment of the High Court and the Sessions Court.
we find that there are no sufficient grounds of interference.
The appeal is summarily dismissed under S 384 of the Code of Criminal Procedure.
After we pronounced our judgment dismissing the appeal summarily under section 384 of the Code of Criminal Procedure, but before signing 355 the judgment, a decision of this Court Sita Ram & Ors.
vs State of U.P. was brought to our notice wherein the scope of the power of the Courts to dismiss an appeal summarily under section 384 of the Code of Criminal Procedure has been referred.
In that case an appeal was preferred to this Court under section 379 of the Code of Criminal Procedure, 1973 read with section 2(a) of the .
The appeal was listed for preliminary hearing under Rule 15(1) (c) of O.XXI of the Supreme Court Rules 1966.
The Appellants filed an application for adducing additional grounds, namely, (1) the provisions under cl.
(c) of sub rule (1) of Rule 15 of Order XXI of the Supreme Court Rules empowering the Court to dismiss the appeal summarily is ultra vires being inconsistent with the provisions of the ; (2) the power of the Supreme Court to frame rules under article 145 of the Constitution cannot be extended to annul the rights conferred under an Act of Parliament and (3) an appeal under the cannot be dismissed summarily without calling for the records ordering notice to the State and without giving reasons.
When the petition fr leave to adduce additional grounds came up before the Court, this Court ordered : "The appellants have challenged the constitutional validity of cl.
(c) of sub rule (1) of rule 15 of O.XXI of the Supreme Court Rules, which enables an appeal of the kind with which we are concerned, to be placed for hearing ex parte before the Court for admission.
In that view of the matter, we think that unless the question of the constitutional validity of the rule is decided, we cannot have a preliminary hearing.
Of this appeal for admission.
Let the records, therefore, be placed before the Hon 'ble the Chief Justice for giving such direction as he may deem fit and proper.
" The matter was placed before a Bench of five Judges by the Hon 'ble the Chief Justice as the constitutional validity of cl.
(c) of rule 15(1) of O.XXI of Supreme Court Rules, was challenged.
Alongwith the question of constitutional validity, two other grounds referred to earlier were also raised.
The contention of the Learned Counsel that a right of appeal cast an obligation on the Court to 356 send for records of the case, to hear both the parties and to make reasoned judgment, was not accepted by the judgment of the Court.
Reasons given by the Court are as follows: "Counsel for the appellant insisted that an absolute right of appeal as he described it, casts an inflexible obligation on the court to send for the record of the case, to hear both parties, and to make a reasoned Judgment.
Therefore, to scuttle the appeal by a summary hearing on a preliminary posting absent record, ex parte and absolved from giving reasons is to be absolutist a position absonent with the mandate of the Enlargement Act Act, indeed, of the Constitution in Article 134(1).
Counsel 's ipsi dixit did not convince us but we have pondered over the issue in depth, being disinclined summarily to dismiss.
" Regarding the power of the Court to summarily dismiss the appeal under section 384 of the Code of Criminal Procedure, the submission of the Learned Counsel was that the provisions of the Code of Criminal Procedure are not applicable to the Supreme Court which contention was not accepted by the Court.
Neither in the application for adducing additional grounds or in the order of the Court directing the matter to be placed before the Constitution Bench, there was any reference to The validity of section 384 of the Code of Criminal Procedure.
Neither was it pleaded during the arguments that section 384 of the Code of Criminal Procedure is ultra vires of the Constitution.
As the question of validity of section 384 the Code of Criminal Procedure was neither raised nor argued, a discussion by the Court after "pondering over the issue in depth ' would not be a precedent binding on the Courts.
The decision is an authority for the proposition that Rule ]5(1)(c) of O.XXI of the Supreme Court Rules should be read down as indicated in the decision.
We are satisfied for the reasons stated above that the decision is no authority regarding the scope of section 384 of the Code of Criminal Procedure.
The order cf dismissal of the appeal summarily will stand, P.B.R. Appeal dismissed.
[/INST]The respondent a member of the Indian Air Force, retired from service on June 15, 1965 but was reemployed for a period of two years with effect from June 16, 1965.
On September 7, 1966 the respondent was transferred to the Regular Air Force Reserve with effect from June 16, 1965 to June 15, 1970 i.e. for a period of five years.
On March 13 1968 the reemployment given to the respondent ceased and his services were terminated with effect from April 1, 1968.
A charge sheet was submitted against the respondent for having committed offences under section 5(2) of the Prevention of Corruption Act, 1947, during the period March 29, 1965 to March 16, 1967.
The respondent filed a petition before the Special Judge for dropping the proceedings against him on the ground that the Judge could not take any cognizance of the offences in the absence of any valid sanction of the appointing authority OF the respondent.
The application was rejected on the ground that as the respondent was not a Commissioned Officer in the Air Force at the time when the cognizance was taken, no sanction of the President was necessary.
The respondent moved the High Court in revision, which quashed the proceedings, holding that as the respondent continued to be a public servant within the meaning of section 21 of the Indian Penal Code inasmuch as he remained a member of Air Force Reserve, sanction was necessary before prosecuting the respondent.
In the appeal to this Court, it was contended on behalf of the appellant: (1) that as the respondent had retired from the Indian Air Force and his employment was terminated with effect from April 1, 1968 he ceased to be a public servant and therefore no sanction was necessary, and (2) that reemployment under the provisions of the Regular Air Force Reserve Act would not amount to an employment in the Regular Force of the Service and therefore even though the respondent may have been reemployed he could not be said to hold the status of a public servant.
Dismissing the appeal, ^ HELD: 1.
The prosecution must prove that at the time when cognizance of the offence was taken the respondent ceased to be a public servant.
[700 C] In the instant case, the Special Judge took cognizance on June 19.
1969 at a time when the respondent continued to be a public servant having been reemployed and though his services were terminated only on April 1, 1968 he 698 continued to be a member of the Auxiliary Air Force upto July 15, 1970, that is a long time after cognizance of the offence was taken.
[700 D] section A. Venkataraman vs The State ; State of West Bengal etc.
vs Manmal Bhutoria & Ors.
; referred to.
2(i) The Provisions of the Auxiliary Air Force Act do not expressly contain the nature of the emoluments that the respondent may receive but the general tenor and setting of the Act clearly show that a member of the Auxiliary Force is as much a public servant as an acting member of the Indian Air Force.
[703 G] (ii) Even after the respondent was transferred to the Auxiliary Air Force he retained his character as a public servant because he was required to undergo training and to be called up for service as and when required.
[703 F]
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<s>[INST] Summarize the judgement: Special Leave Petition (Crl.) No. 2856 of 1979.
From the Judgment and Order dated 6 8 1979 of the Madhya Pradesh High Court in Crl.
Revision No. 392/76.
Sobhag Mal Jain and section K. Jain for the Petitioner.
C. section Chhazed, Miss Manisha Gupta and M. section Gupta for Respondents 1 5.
section K. Gambhir for the State.
The Order of the Court was delivered by KRISHNA IYER, J. `It is procedural rules ', as this appeal proves, `which infuse life into substantive rights, which activate them to make them effective '.
Here, before us, is what looks like a pedestrian quasi criminal litigation under section 133 Cr.
P.C., where the Ratlam Municipality the appellant challenges the sense and soundness of the High Court 's affirmation of the trial court 's order directing the construction of drainage facilities and the like, which has spiralled up to this Court.
The truth is that a few profound issues of processual jurisprudence of great strategic significance to our legal system face us and we must zero in on them as they involve problems of access to justice for the people beyond the blinkered rules of `standing ' of British Indian vintage.
If the centre of gravity of justice is to shift, as the Preamble to the Constitution mandates, from the traditional individualism of locus standi to the community orientation of public interest litigation, these issues must be considered.
In that sense, the case before us between the Ratlam Municipality and the citizens of 100 a ward, is a path finder in the field of people 's involvement in the justicing process, sans which as Prof. Sikes points out,(1) the system may `crumble under the burden of its own insensitivity '.
The key question we have to answer is whether by affirmative action a court can compel a statutory body to carry out its duty to the community by constructing sanitation facilities at great cost and on a time bound basis.
At issue is the coming of age of that branch of public law bearing on community actions and the court 's power to force public bodies under public duties to implement specific plans in response to public grievances.
The circumstances of the case are typical and overflow the particular municipality and the solutions to the key questions emerging from the matrix of facts are capable of universal application, especially in the Third World humanscape of silent subjection of groups of people to squalor and of callous public bodies habituated to deleterious inaction.
The Ratlam municipal town, like many Indian urban centres, is populous with human and sub human species, is punctuated with affluence and indigence in contrasting co existence, and keeps public sanitation a low priority item.
what with cesspools and filth menacing public health.
Ward No. 12, New Road, Ratlam town is an area where prosperity and poverty live as strange bedfellows.
The rich have bungalows and toilets, the poor live on pavements and litter the street with human excreta because they use roadsides as latrines in the absence of public facilities.
And the city fathers being too busy with other issues to bother about the human condition, cesspools and stinks, dirtied the place beyond endurance which made the well to do citizens protest, but the crying demand for basic sanitation and public drains fell on deaf ears.
Another contributory cause to the insufferable situation was the discharge from the Alcohol Plant of malodorous fluids into the public street.
In this lawless locale, mosquitoes found a stagnant stream of stench so hospitable to breeding and flourishing, with no municipal agent disturbing their stinging music at human expense.
The local denizens, driven by desperation, at long last, decided to use the law and call the bluff of the municipal body 's bovine indifference to its basic obligations under section 123 of the M. P. Municipalities Act, 1961 (the Act, for short).
That provision casts a mandate: 123.
Duties of Council. (1) In addition to the duties imposed upon it by or under this Act or any other enactment for the time being in force, it shall be the duty of a Council to 101 undertake and make reasonable and adequate provision for the following matters within the limits of the Municipality, namely: XX XX XX (b) cleansing public streets, places and sewers, and all places, not being private property, which are open to the enjoyment of the public whether such places are vested in the Council or not; removing noxious vegetation, and abating all public nuisances: (c) disposing of night soil and rubbish and preparation of compost manure from night soil and rubbish.
And yet the municipality was obvious to this obligation towards human well being and was directly guilty of breach of duty and public nuisance and active neglect.
The Sub Divisional Magistrate, Ratlam, was moved to take action under section 133 Cr.
P.C., to abate the nuisance by ordering the municipality to construct drain pipes with flow of water to wash the filth and stop the stench.
The Magistrate found the facts proved, made the direction sought and scared by the prospect of prosecution under section 188 I.P.C., for violation of the order under section 133 Cr.
P.C., the municipality rushed from court to court till, at last, years after, it reached this Court as the last refuge of lost causes.
Had the municipal council and its executive officers spent half this litigative zeal on cleaning up the street and constructing the drains by rousing the people 's sramdan resources and laying out the city 's limited financial resources, the people 's needs might have been largely met long ago.
But litigation with other 's funds is an intoxicant, while public service for common benefit is an inspiration; and, in a competition between the two, the former overpowers the latter.
Not where a militant people 's will takes over people 's welfare institutions, energises the common human numbers, canalises their community consciousness, forbids the offending factories from polluting the environment, forces the affluent to contribute wealth and the indigent their work and thus transforms the area into a healthy locality vibrant with popular participation and vigilance, not neglected ghettoes noisy with squabbles among the slimy slum dwellers nor with electoral 'sound and fury signifying nothing. ' The Magistrate, whose activist application of section 133 Cr.P.C., for the larger purpose of making the Ratlam municipal body to do its duty and abate the nuisance by affirmative action, has our appreciation.
He has summed up the concrete facts which may be usefully quoted in portions: "New Road, Ratlam, is a very important road and so many prosperous and educated persons are living on this Road.
On 102 the southern side of this Road some houses are situated and behind these houses and attached to the College boundary, the Municipality has constructed a road and this new Road touches the Government College and its boundary.
Just in between the said area a dirty Nala is flowing which is just in the middle of the main road i.e. New Road.
In this stream (nala) many a time dirty and filthy water of Alcohol Plant having chemical and obnoxious smell, is also released for which the people of that locality and general public have to face most obnoxious smell.
This Nala also produces filth which causes a bulk of mosquitoes breeding.
On this very southern side of the said road a few days back municipality has also constructed a drain but it has (?) constructed it completely but left the construction in between and in some of the parts the drain has not at all been constructed because of this the dirty water of half constructed drain and septic tank is flowing on the open land of applicants, where due to insanitation and due to non removing the obstructed earth the water is accumulated in the pits and it also creates dirt and bad smell and produces mosquitoes in large quantities.
This water also goes to nearby houses and causes harm to them.
For this very reason the applicants and the other people of that locality are unable to live and take rest in their respective houses.
This is also injurious to health".
There are more dimensions to the environmental pollution which the magistrate points out: "A large area of this locality is having slums where no facility of lavatories is supplied by the municipality.
Many such people live in these slums who relieve their lateral dirt on the bank of drain or on the adjacent land.
This way an open latrine is created by these people.
This creates heavy dirt and mosquitoes.
The drains constructed in other part of this Mohalla are also not proper it does not flow the water properly and it creates the water obnoxious.
The Malaria Department of the State of M.P. also pays no attention in this direction.
The non applicants have not managed the drains, Nallahs and Naliyan properly and due to incomplete construction the non applicants have left no outlet for the rainy water.
Owing to above reasons the water is accumulated on the main road, it passes through living houses, sometimes snakes and scorpions come out and this obstruct the people to pass through this road.
This also causes financial loss to the people of this area.
The road constructed by Nagarpalika is on a high level and due to this, this year more 103 water entered the houses of this locality and it caused this year more harm and loss to the houses also.
This way all works done by the non applicants i.e. construction of drain, canal and road come within the purview of public nuisance.
The non applicants have given no response to the difficulties of the applicants, and non applicants are careless in their duties towards the public, for which without any reason the applicants are facing the intolerable nuisance.
In this relation the people of this locality submitted their returns, notices and given their personal appearance also to the non applicants but the non applicants are shirking from their responsibilities and try to avoid their duty by showing other one responsible for the same, whereas all the non applicants are responsible for the public nuisance.
" Litigation is traumatic and so the local people asked first for municipal remedies failing which they moved for magisterial remedies: "At the last the applicants requested to remove all the nuisance stated in their main application and they also requested that under mentioned works must be done by the non applicants and for which suitable orders may be issued forthwith: 1.
The drains constructed by Municipality are mismanaged and incomplete, they should be managed and be completed and flow of water in the drains should be made so that the water may pass through the drain without obstruction.
The big pits and earthen drains which are situated near the College boundary and on the corners of the road where dirty water usually accumulates, they should be closed and the filth shall be removed therefrom.
The big 'Nala ' which is in between the road, should be managed and covered in this way that it must not create overflow in the rainy season.
The Malaria Department should be ordered to sprinkle D.D.T. and act in such a manner and use such means so that the mosquitoes may be eradicated completely from the said locality." The proceedings show the justness of the grievances and the indifference of the local body: "Both the parties heard.
The court was satisfied on the facts contained in their application dated 12 5 72 and granted conditional order against non applicants No. 1 and 2 u/s 133 of Cr.
P.C. (Old Code).
In this order all the nuisances were described (which were there in their main application) and the court directed to remove 104 all the nuisances within 15 days and if the non applicants have any objection or dissatisfaction against the order then they must file it on the next date of hearing in the court." XX XX XX "The applicants got examined the following witnesses in their evidence and after producing following documents they closed their evidence." XX XX XX "No evidence has been produced by the non applicants in spite of giving them so many opportunities.
Both the parties heard and I have also inspected the site." XX XX XX "The non applicant (Municipal Council) has sought six times to produce evidence but all in vain.
Likewise non applicant (Town Improvement Trust) has also produced no evidence.
" The Nallah comes into picture after the construction of road and bridge.
It has shown that Nallah is property of Nagarpalika according to Ex.p. 10.
Many applications were submitted to remove the nuisance but without result.
According to Sec.
32 to 43 of the Town Improvement Trust Act, it is shown, that it has only the provisions to make plans.
Many a time people tried to attract the attention of Municipal Council and the Town Improvement Trust but the non applicants always tried to throw the responsibility on one another shoulder.
XX XX XX It is submitted by non applicant (Municipality) that the said Nallah belongs to whom, it is still disputed i.e. whether it belongs to non applicant 1 or 2.
Shastri Colony is within the area of Town Improvement Trust.
The Nagarpalika (non applicant No. 1) is financially very weak.
But Municipal Council is not careless towards its duties.
Non applicant (Town Improvement Trust) argued that primary responsibility lies with the Municipal Council only.
There is no drainage system.
At the end of it all, the Court recorded: . . . after considering all the facts I come to this conclusion that the said dirty Nallah is in between the main road of Ratlam City.
This dirty Nallah affects the Mohalla of New 105 Road, Shastri Colony, Volga Talkies and it is just in the heart of the city.
This is the very important road and is between the Railway Station and the main city.
In these mohallas, cultured and educated people are living.
The Nallah which flows in between the New Road and Shastri Colony the water is not flowing rapidly and on many places there are deep pits in which the dirty water is accumulated.
The Nallah is also not straight that is also the reason of accumulation of dirty water.
The Nallah is not managed properly by the non applicants.
It is unable to gush the rainy water and due to this the adjoining areas always suffer from over flowing of the water and it causes the obstruction to the pedestrians.
XX XX XX It is also proved by the evidence given by the applicants that from time to time the Power Alcohol factory which is situated outside the premises of the Municipal Council and it flows its dirty and filthy water into the said Nallah, due to this also the obnoxious smell is spreading throughout the New Road or so it is the bounden duty of the Municipal Council and the Town Improvement Trust to do the needful in this respect.
XX XX XX The dirty water which flows from the lavatories and urinals of the residential houses have no outlet and due to this reason there are many pits on the southern side of the New Road and all the pits are full of dirty and stinking water.
So it is quite necessary to construct an outlet for the dirty water in the said locality.
In this area many a places have no drainage system and if there is any drain it has no proper flow and water never passes through the drain properly.
That causes the accumulation of water and by the time it becomes dirty and stink and then it produces mosquitoes there.
The Magistrate held in the end: Thus after perusing the evidence I come to this conclusion and after perusing the applications submitted by the persons residing on the New Road area from time to time to draw the attention of the non applicants to remove the nuisance, the non applicants have taken no steps whatsoever to remove all these public nuisances.
He issued the following order which was wrongly found unjustified by the Sessions Court, but rightly upheld by the High Court: 106 Therefore, for the health and convenience of the people residing in that particular area of all the nuisance must be removed and for that the following order is hereby passed: (1) The Town Improvement Trust with the help of Municipal Council must prepare a permanent plan to make the proper flow in the said Nallah which is flowing in between Shastri Colony and New Road.
Both the non applicants must prepare the plan within six months and they must take proper action to give it a concrete form.
(2) According to para 13 a few places are described which are either having the same drains and the other area is having no drain and due to this the water stinks there; so the Municipal Council and the Town Improvement Trust must construct the proper drainage system and within their own premises where there is no drain it must be constructed immediately and all this work should be completed within six months.
(3) The Municipal Council should construct drains from the jail to the bridge behind the southern side of the houses so that the water flowing from the septic tanks and the other water flowing outside the residential houses may be channellised and it may stop stinking and it should have a proper flow so that the water may go easily towards the main Nallah.
All these drains should be constructed completely within six months by the Municipal Council.
(4) The places where the pits are in existence the same should be covered with mud so that the water may not accumulate in those pits and it may not breed mosquitoes.
The Municipal Council must complete this work within two months.
A notice under Section 141 of the Criminal Procedure Code (Old Code) may be issued to the non applicants Nos. 1 and 2 so that all the works may be carried out within the stipulated period.
Case is hereby finalised.
Now that we have a hang of the case we may discuss the merits, legal and factual.
If the factual findings are good and we do not re evaluate them in the Supreme Court except in exceptional cases one wonders whether our municipal bodies are functional irrelevances, banes rather than booms and 'lawless ' by long neglect, not leaders of the people in local self government.
It may be a cynical obiter of pervasive veracity that municipal bodies minus the people and plus the bureaucrats are the bathetic vogue no better than when the British were here: 107 We proceed on the footing, as we indicated even when leave to appeal was sought, that the malignant facts of municipal callousness to public health and sanitation, held proved by the Magistrate, are true.
What are the legal pleas to absolve the municipality from the court 's directive under section 133 Cr.
P.C. ? That provision reads: section 133(1) whenever a District Magistrate or a Sub Divisional Magistrate or any other Executive Magistrate specially empowered in this behalf by the State Government, on receiving the report of a police officer or other information and on taking such evidence (if any) as he thinks fit, considers (a) that any unlawful obstruction or nuisance should be removed from any public place or from any way, river or channel which is or may be lawfully used by the public; XX XX XX such Magistrate may make a conditional order requiring the person causing such obstruction or nuisance, or carrying on such trade or occupation, or keeping any such goods or merchandise, or owning, possessing or controlling such building, tent, structure, substance, tank, well or excavation or owning or possessing such animal or tree, within a time to be fixed in the order (i) to remove such obstruction or nuisance; or XX XX XX (iii) to prevent or stop the construction of such building, or to alter the disposal of such substance; or if he objects so to do, to appear before himself or some other Executive Magistrate subordinate to him at a time and place to be fixed by the order, and show cause, in the manner hereinafter provided.
why the order should not be made absolute.
So the guns of section 133 go into action wherever there is public nuisance.
The public power of the Magistrate under the Code is a public duty to the members of the public who are victims of the nuisance, and so he shall exercise it when the jurisdictional facts are present as here.
"All power is a trust that we are accountable for its exercise that, from the people, and for the people, all springs, and all must exist.
"(i) Discretion becomes a duty when the beneficiary brings home the circumstances for its benign exercise.
If the order is defied or ignored, section 188 I.P.C. comes into penal play: 108 188.
Whoever, knowing that, by an order promulgated by a public servant lawfully empowered to promulgate such order, he is directed to obtain from a certain act, or to take certain order with certain property in his possession or under his management, disobeys such direction and if such disobedience causes or tends to cause danger to human life health or safety, or causes or tends to cause a riot or affray, shall be punished with imprisonment of either description for a term which may extend to six months, or with fine which may extend to one thousand rupees, or with both.
There is no difficulty in locating who has the obligation to abate the public nuisance caused by absence of primary sanitary facilities.
Section 123, which is mandatory, (we repeat), reads: 123.
Duties of Council : (1) In addition to the duties imposed upon it by or under this Act or any other enactment for the time being in force, it shall be the duty of a Council to undertake and make reasonable and adequate provision for the following matters within the limits of the Municipality, namely: (a). . . (b) cleansing public streets, places and sewers, and all places not being private property, which are open to the enjoyment of the public whether such places are vested in the Council or not; removing noxious vegetation, and abating all public nuisances; (c) disposing of night soil and rubbish and preparation of compost manure from night soil and rubbish.
The statutory setting being thus plain, the municipality cannot extricate itself from its responsibility.
Its plea is not that the facts are wrong but that the law is not right because the municipal funds being insufficient it cannot carry out the duties under section 123 of the Act.
This 'alibi ' made us issue notice to the State which is now represented by counsel, Shri Gambhir, before us.
The plea of the municipality that notwithstanding the public nuisance financial inability validly exonerates it from statutory liability has no juridical basis.
The Criminal Procedure Code operates against statutory bodies and others regardless of the cash in their coffers, even as human rights under Part III of the Constitution have to be respected by the State regardless of budgetary provision.
Likewise, section 123 of the Act has no saving clause when the municipal council is penniless.
Otherwise, a profligate 109 statutory body or pachydermic governmental agency may legally defy duties under the law by urging in self defence a self created bankruptcy or perverted expenditure budget.
That cannot be.
Section 133 Cr.
P.C. is categoric, although reads discretionary.
Judicial discretion when facts for its exercise are present, has a mandatory import.
Therefore, when the sub Divisional Magistrate, Ratlam, has, before him, information and evidence, which disclose the existence of a public nuisance and, on the materials placed, he considers that such unlawful obstruction or nuisance should be removed from any public place which may be lawfully used by the public, he shall act.
Thus, his judicial power shall, passing through the procedural barrel, fire upon the obstruction or nuisance, triggered by the jurisdictional facts.
The Magistrate 's responsibility under section 133 Cr.
P.C. is to order removal of such nuisance within a time to be fixed in the order.
This is a public duty implicit in the public power to be exercised on behalf of the public and pursuant to a public proceeding.
Failure to comply with the direction will be visited with a punishment contemplated by section 188 I.P.C. Therefore, the Municipal Commissioner or other executive authority bound by the order under section 133 Cr.
P.C. shall obey the direction because disobedience, if it causes obstruction or annoyance or injury to any persons lawfully pursuing their employment, shall be punished with simple imprisonment or fine as prescribed in the Section.
The offence is aggravated if the disobedience tends to cause danger to human health or safety.
The imperative tone of section 133 Cr.
P.C. read with the punitive temper of section 188 I.P.C. make the prohibitory act a mandatory duty.
Although these two Codes are of ancient vintage, the new social justice orientation imparted to them by the Constitution of India makes it a remedial weapon of versatile use.
Social justice is due to the people and, therefore, the people must be able to trigger off the jurisdiction vested for their benefit in any public functionary like a Magistrate under section 133 Cr.
In the exercise of such power, the judiciary must be informed by the broader principle of access to justice necessitated by the conditions of developing countries and obligated by article 38 of the Constitution.
This brings Indian public law, in its processual branch, in line with the statement of Prof. Kojima :(1) "the urgent need is to focus on the ordinary man one might say the little man. " "Access to Justice" by Cappelletti and B. Garth summarises the new change thus:(2) 110 "The recognition of this urgent need reflects a fundamental change in the concept of "procedural justice".
The new attitude to procedural justice reflects what Professor Adolf Homburger has called "a radical change in the hierarchy of values served by civil procedure"; the paramount concern is increasingly with "social justice," i.e., with finding procedures which are conducive to the pursuit and protection of the rights of ordinary people.
While the implications of this change are dramatic for instance, insofar as the role of the adjudicator is concerned it is worth emphasizing at the outset that the core values of the more traditional procedural justice must be retained.
"Access to justice" must encompass both forms of procedural justice." Public nuisance, because of pollutants being discharged by big factories to the detriment of the poorer sections, is a challenge to the social justice component of the rule of law.
Likewise, the grievous failure of local authorities to provide the basic amenity of public conveniences drives the miserable slum dwellers to ease in the streets, on the sly for a time, and openly thereafter, because under Nature 's pressure, bashfulness becomes a luxury and dignity a difficult article A responsible municipal council constituted for the precise purpose of preserving public health and providing better finances cannot run away from its principal duty by pleading financial inability.
Decency and dignity are non negotiable facets of human rights and are a first charge on local self governing bodies.
Similarly, providing drainage systems not pompous and attractive, but in working condition and sufficient to meet the needs of the people cannot be evaded if the municipality is to justify its existence.
A bare study of the statutory provisions makes this position clear.
In this view, the Magistrate 's approach appears to be impeccable although in places he seems to have been influenced by the fact that "cultured and educated people" live in this area and "New Road, Ratlam" is a very important road and so many prosperous and educated persons are living on this road.
In India 'one man, one value ' is the democracy of remedies and rich or poor the law will call to order where people 's rights are violated.
What should also have been emphasised was the neglect of the Malaria Department of the State of Madhya Pradesh to eliminate mosquitoes, especially with open drains, heaps of dirt, public excretion by humans for want of lavatories and slums nearby, had created an intolerable situation for habitation.
An order to abate the nuisance by taking affirmative action on a time bound basis is justified in the circumstances.
The nature of the judicial process is not purely adjudicatory nor is it functionally that of an umpire only.
111 Affirmative action to make the remedy effective is of the essence of the right which otherwise becomes sterile.
Therefore, the court, armed with the provisions of the two Codes and justified by the obligation under section 123 of the Act, must adventure into positive directions as it has done in the present case.
Section 133 Cr.
P.C. authorises the prescription of a time limit for carrying out the order.
The same provision spells out the power to give specific directives.
We see no reason to disagree with the order of the Magistrate.
The High Court has taken a correct view and followed the observations of this Court in Govind Singh vs Shanti Sarup(1) where it has been observed: "We are of the opinion that in a matter of this nature where what is involved is not merely the right of a private individual but the health, safety and convenience of the public at large, the safer course would be to accept the view of the learned Magistrate, who saw for himself the hazard resulting from the working of the bakery.
" We agree with the High Court in rejecting the plea that the time specified in the order is unworkable.
The learned judges have rightly said.
"It is unfortunate that such contentions are raised in 1979 when these proceedings have been pending since 1972.
If in seven year 's time the Municipal Council intended to remedy such a small matter there would have been no difficulty at all.
Apart from it, so far as the directions are concerned, the learned Magistrate, it appears, was reasonable.
So far as direction No. 1 is concerned, the learned Magistrate only expected the Municipal Council and the Town Improvement Trust to evolve a plan and to start planning about it within six months: the learned Magistrate has rightly not fixed the time limit within which that plan will be completed.
Nothing more reasonable could be said about direction No. 1.
" A strange plea was put forward by the Municipal Council before the High Court which was justly repelled, viz., that the owners of houses had gone to that locality on their own choice with eyes open and, therefore, could not complain if human excreta was flowing, dirt was stinking, mosquitoes were multiplying and health was held hostage.
A public body constituted for the principal statutory duty of ensuring sanitation and health cannot outrage the court by such an ugly plea.
112 Luckily, no such contention was advanced before us.
The request for further time for implementation of the Magistrate 's order was turned down by the High Court since no specific time limit was accepted by the municipality for fulfillment of the directions.
A doleful statement about the financial difficulties of the municipality and the assurance that construction of drains would be taken up as soon as possible had no meaning.
The High Court observed: "Such assurances, it appears, are of no avail as unfortunately these proceedings for petty little things like clearing of dirty water, closing the pits and repairing of drains have taken more than seven years and if these seven years are not sufficient to do the needful, one could understand that by granting some more time it could not be done." The High Court was also right in rejecting the Additional Sessions Judge 's recommendation to quash the Magistrate 's order on the impression that section 133 Cr.
P.C. did not provide for enforcement of civic rights.
Wherever there is a public nuisance, the presence of section 133 Cr.
P.C. must be felt and any contrary opinion is contrary to the law.
In short, we have no hesitation in upholding the High Court 's view of the law and affirmation of the Magistrate 's order.
Before us the major endeavour of the municipal council was to persuade us to be pragmatic and not to force impracticable orders on it since it had no wherewithal to execute the order.
Of course, we agree that law is realistic and not idealistic and what cannot be performed under given circumstances cannot be prescribed as a norm to be carried out.
From that angle it may well be that while upholding the order of the Magistrate, we may be inclined to tailor the direction to make it workable.
But first things first and we cannot consent to a value judgment where people 's health is a low priority.
Nevertheless, we are willing to revise the order into a workable formula the implementation of which would be watch dogged by the court.
Three proposals have been put forward before us in regard to the estimated cost of the scheme as directed by the Magistrate.
The Magistrate had not adverted to the actual cost of the scheme nor the reasonable time that would be taken to execute it.
As stated earlier it is necessary to ascertain how far the scheme is feasible and how heavy the cost is likely to be.
The Court must go further to frame a scheme and then fix time limits and even oversee the actual execution of the scheme in compliance with the court 's order.
Three schemes placed before us, together with tentative estimates of the costs, have been looked into by us.
Judges are laymen and cannot put on expert airs.
That was why we allowed the municipality 113 and the respondents to produce before us schemes prepared by expert engineers so that we may modify the directions issued by the Magistrate suitably.
Scheme 'A ' is stated to cost an estimated amount of Rs. 1.016 crores.
The State Government has revised this proposal and brought down the cost.
In our view, what is important is to see that the worst aspects of the insanitary conditions are eliminated, not that a showy scheme beyond the means of the municipality must be undertaken and half done.
From that angle we approve scheme 'C ' which costs only around Rs. 6 lakhs.
We fix a time limit of one year for completing execution of the work according to that scheme.
We further direct that the work shall be begun within two months from to day and the Magistrate shall inspect the progress of the work every three months broadly to be satisfied that the order is being implemented bona fide.
Breaches will be visited with the penalty of section 188 I.P.C. We make the further supplementary directions which we specifically enjoin upon the municipal authority and the State Government to carry out.
We direct the Ratlam Municipal Council (R1) to take immediate action, within its statutory powers, to stop the effluents from the Alcohol Plant flowing into the street.
The State Government also shall take action to stop the pollution.
The Sub Divisional Magistrate will also use his power under section 133 I.P.C., to abate the nuisance so caused.
Industries cannot make profit at the expense of public health.
Why has the Magistrate not pursued this aspect ? 2.
The Municipal Council shall, within six months from to day, construct a sufficient number of public latrines for use by men and women separately, provide water supply and scavenging service morning and evening so as to ensure sanitation.
The Health Officer of the Municipality will furnish a report, at the end of the six monthly term, that the work has been completed.
We need hardly say that the local people will be trained in using and keeping these toilets in clean condition.
Conscious cooperation of the consumers is too important to be neglected by representative bodies.
The State Government will give special instructions to the Malaria Eradication Wing to stop mosquito breeding in Ward 12.
The Sub Divisional Magistrate will issue directions to the officer concerned to file a report before him to the effect that the work has been done in reasonable time.
The municipality will not merely construct the drains but also fill up cesspools and other pits of filth and use its sanitary 114 staff to keep the place free from accumulations of filth.
After all, what it lays out on prophylactic sanitation is a gain on its hospital budget.
We have no hesitation in holding that if these directions are not complied with the Sub Divisional Magistrate will prosecute the officers responsible.
Indeed, this court will also consider action to punish for contempt in case of report by the Sub Divisional Magistrate of willful breach by any officer.
We are sure that the State Government will make available by way of loans or grants sufficient financial aid to the Ratlam Municipality to enable it to fulfil its obligations under this order.
The State will realise that article 47 makes it a paramount principle of governance that steps are taken 'for the improvement of public health as amongst its primary duties '.
The municipality also will slim its budget on low priority items and elitist projects to use the savings on sanitation and public health.
It is not our intention that the ward which has woken up to its rights alone need be afforded these elementary facilities.
We expect all the wards to be benefited without litigation.
The pressure of the judicial process, expensive and dilatory, is neither necessary nor desirable if responsible bodies are responsive to duties.
Cappelletti holds good for India when he observes :(1) "Our judicial system has been aptly described as follows: Admirable though it may be, (it) is at once slow and costly.
It is a finished product of great beauty, but entails an immense sacrifice of time, money and talent.
This "beautiful" system is frequently a luxury; it tends to give a high quality of justice only when, for one reason or another, parties can surmount the substantial barriers which it erects to most people and to many types of claims.
" Why drive common people to public interest action ? Where Directive Principles have found statutory expression in Do 's and Dont 's the court will not sit idly by and allow municipal government to become a statutory mockery.
The law will relentlessly be enforced and the plea of poor finance will be poor alibi when people in misery cry for justice.
The dynamics of the judicial process has a new 'enforcement ' dimension not merely through some of the provisions of the Criminal Procedure Code (as here), but also through activated tort consciousness.
The officers in charge and even the elected representatives will have 115 to face the penalty of the law if what the Constitution and follow up legislation direct them to do are defied or denied wrongfully.
The wages of violation is punishment, corporate and personal.
We dismiss this petition subject to the earlier mentioned modifications.
N.V.K. Petition dismissed.
[/INST]The residents (respondents) of a prominent residential locality of the Municipality (petitioner) in their complaint under section 133 Criminal Procedure Code to the Sub Divisional Magistrate averred that the Municipality had failed despite several pleas, to meet its basic obligations, like provision of sanitary facilities on the roads, public conveniences for slum dwellers who were using the road for that purpose, and prevention of the discharge from the nearby Alcohol Plant of maladorous fluids into the public street, and that the Municipality was oblivious to the statutory obligation envisaged in section 123 M. P. Municipalities Act, 1961 The Municipal Council contested the petition on the ground that the owners of houses had gone to that locality on their own choice, fully aware of the insanitary conditions and therefore they could not complain.
It also pleaded financial difficulties in the construction of drains and provision of amenities.
The Magistrate found the facts proved, and ordered the municipality to provide the amenities and to abate the nuisance by constructing drain pipes with flow of water to wash the filth and stop the stench and that failure would entail prosecution under section 188 I.P.C.
The order of the Magistrate was found unjustified by the Sessions Court, but upheld by the High Court.
In the Special Leave Petition by the Municipality to this Court on the question whether a Court can by affirmative action compel a statutory body to carry out its duty to the community by constructing sanitation facilities at great cost and on a time bound basis.
^ HELD : 1.
Wherever there is a public nuisance, the presence of section 133 Criminal Procedure Code must be felt and any contrary opinion is contrary to the law.
[112D] 2.
The public power of the Magistrate under the Code is a public duty to the members of the public who are victims of the nuisance and so he shall exercise, it when the jurisdictional facts are present.
[107G] 98 3.
The Magistrate 's responsibility under section 133 Cr.
P.C. is to order removal of such nuisance within a time to be fixed in the order.
This is a public duty implicit in the public power to be exercised on behalf of the public and pursuant to a public proceeding.
Failure to comply with the direction will be visited with a punishment contemplated by section 188 I.P.C. [109C D] 4.
The Municipal Commissioner or other executive authority bound by the order under section 133 Criminal Procedure Code shall obey the direction because disobedience, if causes obstruction or annoyance or injury to any persons lawfully pursuing their employment, shall be punished with simple imprisonment or fine as prescribed in the section.
The offence is aggravated if the disobedience tends to cause danger to human health or safety.
[109E] 5.
Public nuisance, because of pollutants being discharged by big factories to the detriment of the poorer sections, is a challenge to the social justice component of the rule of law.
[110C] 6.
The imperative tone of section 133 Criminal Procedure Code read with the punitive temper of section 188 I.P.C. make the prohibitory act a mandatory duty.
[109E] 7.
The Criminal Procedure Code operates against statutory bodies and others regardless of the cash in their coffers, even as human rights under Part III of the Constitution have to be respected by the State regardless of budgetary provision.
[108H] 8.
Section 123 M. P. Municipalities Act 1961 has no saving clause when the municipal council is penniless.
[108H] 9.
Although the Cr.
P.C. and I.P.C. are of ancient vintage the new social justice orientation imparted to them by the Constitution of India makes them a remedial weapon of versatile use.
Social Justice is due to the people and, therefore, the people must be able to trigger off the jurisdiction vested for their benefit in any public functionary like a Magistrate under section 133 Criminal Procedure Code.
In the exercise of such power, the judiciary must be informed by the broader principle of access to justice necessitated by the conditions of developing countries and obligated by article 38 of the Constitution.
[109F G] 10.
A responsible municipal council constituted for the precise purpose of preserving public health and providing better finances cannot run away from its principal duty by pleading financial inability.
Decency and dignity are non negotiable facets of human rights and are a first charge on local self governing bodies.
Similarly, providing drainage systems not pompous and attractive, but in working condition and sufficient to meet the needs of the people cannot be evaded if the municipality is to justify its existence.
[110E] 11.
The Court, armed with the provisions of the two Codes and justified by the obligation under section 123 of the Act, must adventure into positive directions as it has done in the present case.
Section 133 Criminal Procedure Code authorises the prescription of a time limit for carrying out the order.
The same provision spells out the power to give specific directives.
[111A B] Govind Singh vs Shanti Sarup, ; , 279 referred to.
The state will realise that article 47 makes it a paramount principle of governance that steps are taken for the improvement of public health as amongst its primary duties.
The municipality also will slim its budget on 99 low priority items and elitist projects to use the savings on sanitation and public health.
[114C] 13.
Where Directive Principles have found statutory expression in Do 's and Don 'ts the court will not sit idly by and allow municipal government to become a statutory mockery.
The law will relentlessly be enforced and the plea of poor finance will be poor alibi when people in misery cry for justice.
The dynamics of the judicial process have a new `enforcement ' dimension not merely through some of the provisions of the Criminal Procedure Code (as here) but also through activated tort consciousness.
The officers in charge and even the elected representatives will have to face the penalty of the law if what the Constitution and follow up legislation direct them to do are defied or denied wrongfully.
The wages of violation is punishment, corporate and personal.
[114G 115A] [The Court approved a scheme of construction work to be undertaken by the Municipality for the elimination of the insanitary conditions and directed that the work be commenced within two months and that the Magistrate inspect the progress of the work every three months and see that it is implemented.
[113 D 114 B]
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<s>[INST] Summarize the judgementivil Appeal No. 5055 of 1989.
From the Judgment and Order dated 27.2.1989 of the Allahabad High Court in C.M.W.P. No. 12322 of 1984.
Satish Chandra, E.C. Agarwala, Atul Sharma, Ms. Purnima Bhatt and V.K. Pandita for the Appellants.
G.L. Sanghi, B.D. Agarwal, G. Ganesh, K.L. John and Ms. Shobha Dikshit for the Respondents.
531 The Judgment of the Court was delivered by SHARMA, J.
This case arises out of a proceeding under the Indian Stamp Act, 1899.
Special leave is granted.
A dispute between the appellants and the respondent No. 1, who are members of a family, was referred to an arbitrator, who made an award on 9.10.1973, and filed the same within a few days before the civil court for making it a rule of the court.
On objection by the present appellants, the prayer was rejected on 18.3.1976 and the order was confirmed by the High Court on 3.7.1981 in a regular first appeal.
An application for special leave was dismissed by this Court on 18.4.1983 and a prayer for review was also rejected.
It is stated on behalf of the appellants that in the meantime the respondent No.1 applied before the Collec tor for summoning the award and realising the duty and penalty.
A copy of the award was annexed to the application.
The respondent 's prayer was opposed by the appellants but was allowed by the Collector on 15.7.1983; and, on a request made to the civil court for sending the award, the civil court asked the office to do so.
The appellants moved the Chief Controlling Revenue Authority under section 56 of the Indian Stamp Act (hereinafter referred to as the Act) against the Collector 's order dated 15.7.1983.
The Authority in exercise of its revisional power set aside the impugned order of the Collector, inter alia, on the ground of lack of jurisdiction.
The respondent challenged this judgment before the High Court in a writ case which was allowed by the impugned judgment dated 27.2.1989.
The matter was remanded to the Collector to decide the case afresh in the light of the observations.
The High Court also doubted the power of the Chief Controlling Revenue Authority to entertain the appellants ' application under section 56 of the Act.
This judg ment is the subject matter of the present appeal.
Mr. Satish Chander, the learned counsel for the appellants, contended that there cannot be any doubt about the power of the Chief Controlling Authority to correct an erroneous order of the Collector.
Emphasis was laid on the language of section 56 suggesting its wide application.
The learned counsel was also right in arguing that the Authority is not only vested with jurisdiction but has the duty to quash an order passed by the Collector purporting to be under Chapters IV and V of the Act by exercising power beyond his jurisdiction.
To hold otherwise will lead to an absurd situation where a subordinate authority makes an order beyond its jurisdiction, which will have to be suf fered on account of its unassailability before a higher 532 authority.
This Court in Janardan Reddy and Others vs The State of Hyderabad and Others, ; , after refer ring to a number of decisions, observed that it is well settled that if a court acts without jurisdiction, its decision can be challenged in the same way as it would have been challenged if it had acted with jurisdiction, i.e., an appeal would lie to the court to which it would lie if its order was with jurisdiction.
We, therefore, agree with the appellants that the Chief Controlling Revenue Authority had full power to interfere with the Collector 's order, provided it was found to be erroneous.
Their difficulty, however, is that we do not find any defect in the Collector directing to take steps for the realisation of the stamp duty.
It was contended on behalf of the appellants that the respondent No. 1 had no locus standi to move the Collector for impounding the award and sub section (1) of section 33 of the Act had no application.
The learned counsel proceeded to say that in the circumstances it has to be assumed that the Collector acted suo motu under sub section (4) of the said section and since the proviso to sub section (5) directs that no action under sub section (4) shall be taken after a period of four years from the date of execution of the instrument, the Collector had no authority to pass the impugned order after about a decade.
In reply, Mr. G.L. Sanghi urged that the order for impounding the award was passed by the civil court itself on 18.3.1976, and the further orders of the Collector dated 22.7.1983 and of the civil court dated 27.8.1983 were passed merely by way of implementing the same.
The learned counsel is right in relying upon the concluding portion of the order of the civil court dated 18.3.1976 directing the impounding of the award and sending it to the Collector for necessary action.
It is true that further steps in pursuance of this judgment were not taken promptly and it was the respondent No. 1 who drew the attention to this aspect, but it cannot be legiti mately suggested that as the reminder for implementing the order came from the respondent, who was motivated by a desire to salvage the situation to his advantage, further steps could not be taken.
There is no question of limitation arising in this situation and it cannot be said that what had to be done promptly in 1976 would not be done later.
The orders of the Collector dated 15.7.1983 and 22.7.1983 must, therefore, in the circumstances, be held to have been passed as the follow up steps in pursuance of the civil court 's direction dated 18.3.1976, and no valid objection can be taken against them.
The Collector, therefore, shall have to proceed further for realisation of the escaped duty.
It was next contended that in any event the Collector did not 533 have the power to enquire into the correct valuation of the property which was the subject matter of the award.
Reliance was placed on the observations in Himalaya House Co. Ltd. Bombay vs Chief Controlling Revenue Authority, There is no merit in this point either.
The case comes from Uttar Pradesh where express provisions have been made by the insertion of section 47 A, authorising the Collector to examine the correctness of the valuation.
Lastly Mr. Satish Chandra argued that the respondent No. 1 is taking keen interest in the present proceeding in an attempt to illegally re open the question of making the award a rule of the court, which stood concluded by the impugned judgment of the High Court and the order of this Court dismissing the special leave petition therefrom and he can not be allowed to do so.
The reply of Mr. Sanghi has been that this aspect is not relevant in the present pro ceeding for realisation of the duty and need not be decided at this stage.
His stand is that an award which is not made rule of the court is not a useless piece of paper and can be of some use, say by way of defence in a suit.
He said that this question will have to be considered if and when the occasion arises.
Having regard to the limited scope of the present proceeding, we agree with Mr. Sanghi that we may not go into this aspect in the present case, but we would clari fy the position that on the strength of the present judgment it will not be open to the respondent to urge that the effect of the High Court decision dated 8.7.1981 and the orders of this Court dismissing the special leave petition therefrom and later the review application has disappeared or has got modified.
The appeal is disposed of in the above terms, but the parties are directed to bear their own costs of this Court.
G.N. Appeal disposed of.
[/INST]A decree on a mortgage was passed in a suit brought by the representatives in interest of a sub mortgagee in 1929 and a personal decree for recovery of the amount remaining due after the sale of the mortgaged properties was passed in 1935.
In 1936 the decree holder started execution of the personal decree and attached certain properties of the judgment debtor.
The decree holder filed a petition on January 30, 1937, praying that the execution case "may be struck off for non prosecution, keeping the attachment in force" in view of certain negotiations for amicable settle ment, and the court passed an order that the execution case "is dismissed for non prosecUtion, the attachment 573 already effected continuing".
On June 2, 1939, the decree holder filed a petition stating that the decree had been adjusted and attachment may be withdrawn.
The Bengal Money lenders Act came into force on September 1, 1940, and on January 2, 1941, the legal representatives of the judg ment debtor filed a suit under section 36 of the Act praying for re opening the transactions.
The question being whether any proceeding for execution was pending on or after January 1, 1939, within the meaning of the definition of "a suit to which this Act applies" contained in section 2 (22) of the Bengal Money lenders Act: Held, per KANIA C.J. and DAs J. That the order of January 30, 1937, was in form and in substance a final order of dismissal of the execution petition of 1936.
The attach ment continued not because there was a pending execution proceeding but because a special order for continuing the attachment was made under O. 21, r. 57 of the Civil Proce dure Code as amended by the Calcutta High Court, and not withstanding the fact that the attachment was continued there was no execution proceeding pending on January 1, 1939, and accordingly the decree sought to be reopened was not one passed in "a suit to which the Act applies" within the meaning of section 2 (22) of the Act and the Court had no power to re open the transactions under section 36 (2).
The petition of June 2, 1939, was also not a proceeding for execution but a mere certification by the decree holder of satisfaction of the decree.
PATANJALI SASTRI J.
The continuance of the attachment notwithstanding the dismissal of the execution petition, indicated that the proceeding which had resulted in the attachment was kept alive to be carried forward later on by sale of the attached property.
Attachment itself is "a proceeding in execution" and so long as it subsists, the proceeding in execution can well be regarded as pending.
In this view a proceeding in execution was pending on January 1, 1939, and the decree must be taken to have been passed in "a suit to which this Act applies ".
But inasmuch as the sub mortgage to the respondent 's predecessor in title was bona fide and he obtained by virtue of the sub mortgage the right to sue the original mortgagor for recovery of the mortgage debt, the decree holder was a bona fide assignee and his claim for the entire decree debt was protected by section 36 (5) of the Act.
Renula Bose v, Manmatha Nath Bose (L.R. 72 I.A. 156), Promode Kumar Roy vs Nikhil Bhusan Mukhopadhya (50 C.W.N. 407) and Prom ode Kumar Roy vs Nikhil Bhusan Mukhopadhya (L.R. 76 I.A. 74) referred to.
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<s>[INST] Summarize the judgementAppeal No. 1936 of 1967 From the Judgment and Decree dated the 14th October, 1966 of Andhra Pradesh High Court in Appeal No. 239 of 1961 and Memo of Cross Objections therein arising out of the judgment and decree dated 28th March 1958 of the Subordinate Judge, Srikakulam in Original Suit No. 101 of 1954.
M. Natesan, K. Jayaram and R. Chandrasekhar, for the appellant, P. Parmeshwara Rao and T. Satyanarayana, for the respondent.
The Judgment of D. G. PALEKAR, and R. section SARKARIA JJ.
was delivered by SARKARIA, J. V. R. KRISHNA IYER, J. gave a separate Opinion.
658 SARKARIA J.
This appeal by certificate, involves an examination of the, limits, of the respective.
jurisdictions of the Settlement Officer/Tribunal and the Civil Court in relation to an inquiry under section 9(1) of the Madras Estates (Abolition and Conversion into Ryotwari) Act, 1948 (for short, Abolition Act) and the effect of the Amending Acts .17 and 18 of 1957 and Act 20 of 1960 on cases regarding such an inquiry pending in or decided by the, Civil Courts.
It arises out of the following facts : The lands in dispute are situated in village Kadakalla, Taluk Palakonda.
On June 13, 1950, the then State Government issued and published a notification under the, Madras Estates (Reduction of Rent) Act, 1947 (for short, Rent Reduction Act) in respect of this village.
Subsequently, the Settlement Officer of Srikakulam suo motu made an enquiry as to whether this village was an "estate" or not within the contemplation of section 9(2) of the Madras Estates (Abolition and Conversion into Ryotwari) Act, 1948 (for short, called Abolition Act) and by an order, dated September 2, 1950, held that it was not an 'inam estate ' within the meaning of section 2(7) of the Abolition Act.
The Settlement Officer further recorded a finding that village Kadakalla became an estate by virtue of the Madras Estates Land (3rd Amendment) Act, 1936.
Against that order of the Settlement Officer, the appellants herein carried an appeal to the Estates Abolition Tribunal, Vizianagaram.
The 'Tribunal by its order, dated September 16, 1952 dismissed the appeal in limine, with the observation that the decision of the Settlement Officer being in their favour the appellants had no right of appeal, The appellants then instituted O.S. 47 of 1953 in the Court of the Subordinate Judge, Srikakulam against the State Government for a declaration that Kadakalla village was not an 'estate ' under section 3 (2) (d) of 1908 Act, and consequently,_the Rent Reduction Act and the Abolition Act were not applicable to it.
The trial court decreed the suit.
Aggrieved by the decree, the State preferred an appeal (A.S. 668 of 1954) to the High court of Andhra Pradesh.
During the pendency of the said appeal, the appellants instituted Original Suit No. 101 of 1954 (out of which the present appeal has arisen) in the Court of Subordinate Judge Srikakulam, against the respondents herein and others for the recovery of Rs. 15,681/19 as rent or damages for the year 1953 in respect of the lands cultivated by them in the area of village Kadakalla.
The suit was resisted by the respondents inter alia on the ground that the suit village was an 'estate ' as defined in section 3(2) (d) of the 1908 Act, and that it had been so held by the Settlement Officer as per his Order dated September 2, 1950.
It was further averred that the defendants not being parties to O.S. 47 of 1953, were not bound by the decision in that case.
It was added that the question as to whether this village was an estate or not, was pending in the High 'Court of Andhra Pradesh in appeal from the decision in O.S. 47 of 1953, and as such, was sub judice.
The jurisdiction of the Subordinate 659 Judge to try the suit (O.S. 101 of 1954) was also questioned.
The claim for rent or damages was also resisted.
On January 22, 1958, the respondents herein made an application for permission to file an additional written statement for adding the plea that the suit village is an 'inam estate.
On March 17, 1958, the trial court dismissed this application holding that the question %ought to be raised, was already covered by Issue No. 1.
The trial court framed as many as eleven issues, out of which Issues 1, 6 and 8 were as follows : (1) Whether the suit village is an estate within the meaning of Section 3 (2) (d) of the Madras Estates Land Act ? (6) Whether the plaintiffs are barred and estopped to claim rents in view of prior pattas and rent decrees that were previously obtained ? (8) Whether this Court has no jurisdiction to try the suit? On March 26, 1958, the Advocates for the parties filed a joint memo to the effect that "both parties agree to abide by the final decision whether in the High Court or in the Supreme Court, as the case may be, in the appeal or revision, arising out of O.S. No. 47 of 1953 on the file of this Court on the question whether the, suit village Kadakalla is not an estate under section 3(2)(d) of the Madras Estates Land Act, as amended upto date".
As a result of this compromise, it was held that the decision of Issues 1, 6 and 8 would follow the final decision in O.S. 47 of 1953.
The remaining Issues were tried and decided on merits.
On March 28, 1958, the trial court keeping in view the joint memo filed by the parties and its findings on the other Issues, passed a decree in these terms : "In case it is ultimately decided by the High Court or the Supreme Court, as the case may be, in the appeal or revision arising out of O.S. No. 47 of 1953 on the file of this Court that the suit village Kadakalla is not an estate within the meaning of section 3 (2) (d) of the Estates Land Act, the defendants to pay to the plaintiffs the sum of Rs. 3,000/ with in terest at 5 1/2 per cent per annum from 26 3 1958 with interest thereon and for costs, and that otherwise suit should stand dismissed with costs and that the decree should take effect from the date of the final decision of O.S. No. 47 of 1953 referred to above.
" The appeal (A.S. 668 of 1954) arising out of O.S. 47 of 1953 was decided by the High Court on February 12, 1959 whereby the decree of the, trial court declaring that village Kadakalla was not an estate, was confirmed.
The application of the State for issuance of a certificate of fitness for appeal to the Supreme Court was dismissed by the High Court.
The State did not prefer any Special Leave Peti 660 tion in this Court, with the result, that the High Court 's decision in that case became final and the decree, dated March 28, 1958, of the Subordinate Judge in O.S. 101 of 1954 also became effective.
After the disposal of its appeal (A.S. 668 of 1954), the Government issued G.O.R.T. No. 619 Rev. dated June 30, 1966, canceling the earlier notifications in respect of this village notwithstanding the fact that prior to such renotification, section 9 A had been inserted in the Abolition Act by the Amending Act 20 of 1960.
Appellants preferred an appeal (A.S. 239 of 1961) against the said decree, dated March 28, 1958, of the Subordinate Judge, to the High Court.
Though in the Memorandum of Appeal, it was said.
as usual, in general terms, that the "decision of the lower court is against law, weight of evidence and probabilities of the case", and that its decree was "worthless and did not conform to the requirements of section 2(2) of the Civil Procedure Code, yet, in substance, the appeal related only to the extent of the land in the possession of the respondents and the quantum of rent or damages.
The appellants ' claim was that the entire suit land, as alleged in the plaint, was under the cultivation of the respondents, and consequently.
the lower court was wrong in not decreeing the appellants ' claim for Rs. 15,681/19 as rent or damages, in toto.
On April 6. 1962.
the respondents filed cross objections contending that the question as to whether Kadakalla village is or is not an 'estate ' as defined in section 3(2)(d) of the 1908 Act, should have been gone into by the trial court and that the rent should have been decreed only in the sum of Rs. 551/29.
The High Court posted the appeal and the cross objections for hearing in July, 1965.
, At that stage, on July 19, 1965.
an application was made by the respondents praying that Exhts.
B 196 and B 197, being copies of the order, dated September 2, 1950, of the Settlement Officer and the order dated September 16, 1952, of the Estate Abolition Tribunal, respectively, be read as additional evidence.
It was contended that the Amending Act 20 of 1960 had added section 9A to the Abolition Act, as a result of which, the order of the Settlement Officer had acquired 'statutory validity '; and since the appellants did not file an appeal within two months from the commencement of the Amendment Act, the decision of the Settlement Officer became final and binding on all the parties including the appellants.
In spite of opposition by the, appellants, the High Court by its order, dated August 23, 1956, allowed this additional evidence and the setting up of the new plea.
The appeal and the cross objections were heard together in August.
The respondents raised a preliminary objection that the suit itself was incompetent as the Civil Court had no jurisdiction to decide whether the suit village is an estate, or not and, therefore, any decision given by the High Court in appeal (A.S. 668 of 1954) would not bind the parties and the decree in the present suit (O.S. 101 of 1954) on the, basis of the judgment and decree in A.S. 668 661 of 1954.
would be without jurisdiction rendering it null and void, .that the Settlement Officer was the competent authority to decide the tenure of the village and his decision had become final in view of the introduction of Section 9A by Act 20 of 1960.
The preliminary objection of the respondents was upheld, The contention of the appellants, that since section 9A was inserted by an amendment which came into force on June 23, 1960, it could not affect the compromise decree of the Court passed earlier on March 28.
1958 or the decree of the High Court whereby both the parties agreed to abide, by the decision of the High Court or the Supreme Court in appeal or revision arising out of O.S. 47 of 1953, was rejected in these terms "We see no force in this contention as Section 9A is designed to meet such of the decisions where it has been held that the village is not an inam estate as it stood after the 1936 Act and certainly the respondents can take advantage of change.
in statute,, if it is to their benefit and there could be no estoppel against a statute and the rights accrued under a statute.
It cannot reasonably be contended that the suit filed by the appellants and the decree obtained have reached any finality as an appeal is only the continuation of the proceedings instituted by the plaintiffs.
" In the result.
it dismissed the appeal holding that the Civil Court was not the forum for the suit as framed by the appellants and the questions raised in the suit including the claim ' for arrears of rent or damages.
were outside the Jurisdiction of the Civil Court.
Before dealing with the contentions canvassed, it will be useful to have a clear idea of the relevant statutory provisions, including the expressions "inam village", "inam estate" and "estate" as defined therein.
section 3(2)(d) of the Madras Estates Land Act.
1908, as it originally stood, defined "estate" as "any village of which the land revenue alone (i.e. melwaram alone) has been granted in inam to a person not owing the kudiwaram (rights in soil) thereof, provided the grant has been made, confirmed or recognised by the British Government or as separated part of such village.
" In this definition, it was not clear whether the inamdar had the melwaram alone or both melwaram and kudiwaram.
To remove this obscurity, the Madras Estates Land (Third Amendment) Act, (18 of 1936), substituted for the original sub clause (d) in section 3(2), this new clause "(d) any inam village of which the grant has been made, confirmed or recognised by the Government 'notwithstanding that subsequent to the grant, the village has been partitioned among the grantees or the successors in title of the grantee or grantees." ' Section 3(2)(d) was further amended by Madras Estates Land Amendment Act II of 1945 with retrospective effect from the date 662 on which the Third Amendment Act 18 of 1936 came into force.
It inserted (among others) Explanation 1, to this clause, which reads "Where a grant as an inam is expressed to be of a named village.
the area which forms the subject matter of the grant shall be deemed to be an estate notwithstanding that it did not include certain lands in the village of that name would have already been granted on service or other tenure or been reserved for communal purposes." Explanation I makes it clear that (apart from being made, confirmed, or recognised by the Government), an inam grant in order to come within the purview of "estate" under section 3(2) (d) has to be a grant expressly made of a named village or whole Village, and not only of a part of the village or of some defined area in a village.
However, it remains and is 'deemed to be a grant of a whole village notwithstanding the exclusion of certain lands already granted on service ,or other tenure or reserved for communal purposes; nor does it cease to be a grant of an entire village merely because the village has been subsequently ' partitioned amongst the grantees or their successors.
The interpretation of "estate" has behind it the authority of a bedroll of decisions, including that of this Court in District Board, Tanjore, vs Noor Mohammed(1) Next, in chronological order, is the Madras Estates (Abolition and Conversion into Ryotwari).
Act, (XXVI of 1948).
Section 1(3) thereof provided that "it applies to all estates as defined in section 3, clause (2) of the Madras Estates Land Act.
1908 (except inam villages which became estates by virtue of the Madras Estates Land (Third Amendment) Act, 1936.
The material part of section 2 of this Act says (3) "Estate" means a zamindari or an under tenure or an under tenure of an inam estate.
(7) "Inam Estate" means an estate within the meaning of section 3.
clause (2) (d), of the Estates Land Act, but does not include an inam village which became an estate by virtue of the Madras Estates Land (Third Amendment) Act, 1936".
Thus, to begin with, this Act did not take in its fold post 1936 inam estates.
Its operation remained confined to pre 1936 inam estates till the commencement of Act 18 of 1957, which we shall presently notice.
Section 9 of the Abolition Act indicates the authorities empowered to determine Inam estate.
It says "(1) As soon as may be after the passing of this Act, the Settlement Officer may suo motu and shall, on application enquire and determine whether an inam village in his jurisdiction is an inam estate or not.
(1) (1952) 2 M. J 586 (section C.) 663 (2) Before holding the inquiry, the Settlement Officer shall cause to be published in the village in the prescribed manner, a notice requiring all persons claiming an in terest in any land in the village to file before, him statements bearing on the question whether the village is an inam estate or not.
(3) The Settlement Officer shall then hear the parties and afford to them a reasonable opportunity of adducing all such evidence either oral or documentary as they may desire to examine all such documents as he has reason to believe are in the possession of the Government and have a bearing on the question before him and give him decision in writing.
(4) (a) Any person deeming himself aggrieved by a decision of the Settlement Officer under sub section (3) may within two months from the date of the decision or such further time as the Tribunal may in its discretion allow, appeal to the Tribunal.
(b) Where any such appeal is preferred, the Tribunal shall cause to.
be Publisher in the village in the prescribed manner a notice requiring all persons who have applied to the Settlement Officer under sub section (1) or filed before him before it, and after giving them a reasonable opportunity of being heard, give its decision.
(c) The decision of the Tribunal under this sub section shall be final and not be liable to be questioned in any court of law.
(5) No decision of the Settlement Officer under sub section (3) or of the Tribunal under sub section (4) shall be invalid by reason of any defect in the form of the notice referred to in sub section (2) or sub section (4) as the case may be, or the manner of its publication.
(6) Every decision of the Tribunal and subject to such decision, every decision of the Settlement Officer under this section shall be binding on all persons claiming an interest in any law in the village.
notwithstanding that any such person has not preferred any application or filed any statement or adduced any evidence or appeared or participated in the proceedings before the Settlement Officer or the Tribunal as the case may be.
(7) In the absence of evidence to the contrary the Settlement Officer and the Tribunal may Presume that an inam village is an inam estate".
Madras Amendment Act 17 of 1951, introduced section 64 A, which runs thus: "64 A.(1) The decision of a Tribunal or Special Tribunal in any proceeding under this Act, or of a Judge of the 664 High Court hearing a case under Section 51 (2), on any matter falling within its or his Jurisdiction shall be binding on the parties thereto, ' and persons claiming under them, in any suit of.
proceeding in a Civil Court in so far as such matter is in issue between the parties or persons aforesaid in such suit or proceeding.
(2) The decision of a Civil Court (not being ;he Court of Small Causes) on any matter within its jurisdiction shall be binding on the parties thereto and persons claiming under them in any proceeding under this Act before a Tribunal or Special Tribunal, or a Judge of the High Court under section 5 1 (2) in so far as such matter is in issue between the parties or persons aforesaid in such proceeding.
" In 1957, two Amending Acts both of which came into force on December 23, 1957, were passed.
One was Andhra Pradesh Act 17 of 1957, which substituted the following clause for clause (a) in subsection (4) of section 9 of the Abolition Act, 1948 : (a) (i) Against a decision of the Settlement Officer under subsection (3), the Government may, within one year from the date of the decision or if such decision was given before the commencement of the Madras Estates (Abolition and Conversion into Ryotwari) (Andhra Pradesh Amendment) Act, 1957, within one year from such commencement and any persons aggrieved by such decision may within two months from the date of the decision or such further time as the Tribunal may in its discretion allow, appeal to the Tribunal.
(ii) If,, before the commencement of the Madras Estates (Abolition and Conversion into Ryotwari) (Andhra Pradesh Amendment) Act, 1957, any order has been passed by the Government against a decision of the Settlement Officer on the ground that the Government were not competent to file an appeal under this clause or that such appeal was time barred, the Tribunal shall on an application filed by the Government within one year from the commencement of the Amendment Act aforesaid, vacate the order already passed by it and pass a fresh order on merits.
" In clause (b) of s.9(4) of the Abolition Act, after the words where such appeal is preferred", the words "by an aggrieved person, the Tribunal shall give notice to the Government and in the case of all appeals whether by the ;Government or by an aggrieved person" were inserted.
The second Amending Act was Andhra Pradesh Act 18 of 1957, section 2 of which substituted the following section for sub section (3) of section 1 of the Abolition Act 665 "It applies to all estates as defined in section 3, clause (2), of the Madras Estates Land Act, 1908, (Madras Act 1 of 1908).
" This Act further substituted the following clause for clause (7) of s.2 of the principal Act: "In an estate" means an estate within the meaning of section 3, clause (2) (d) of the Madras Estates Land Act, 1908 (Madras Act 1 of 1908)".
In s.9 of the principal Act, after the words "Inam village" or "the village", wherever they occurred the words "or hamlet or khandriga granted as inam" were inserted.
It will be seen that Act 18 of 1957, made the Abolition Act applicable even to villages that became estates under the 1936 Amendment of the 1908 Act.
For the purpose of the Abolition Act that distinction between pre 1936 and post 1936 inam grants disappeared, and this Act became applicable to all estates falling under the definition ill section 3 (2) of the 1908 Act.
Andhra Pradesh Act No. 20 of 1960, which came into force on the 23rd of June, 1960 inserted in the Abolition Act, s.9 A, which, provides : " Inquiry under section 9 not necessary in certain cases If before the commencement of the Madras Estates (Abolition and Conversion into Ryotwari) (Andhra Pradesh Second Amendment) Act, 1957 (Andhra Pradesh Act XVIII of 1957) (any decision was given under section 9 in respect of any village that it was not an inam estate as it stood defined before such commencement, and that decision was based on the finding that the inam village became an estate by virtue of the Madras Estates Land ( 'third Amendment) Act, 1936 (Madras Act XVIII of 1936) then: (a) if the decision based on the finding aforesaid was given by the Tribunal under sub section(4) of section 9, no fresh inquiry under that section shall be necessary for taking any, proceedings tinder this Act on the basis of that finding; and (b) if the decision based on the finding aforesaid was given by the Settlement Officer, and no appeal was filed to the Tribunal, the Government or any person aggrieved, may appeal to the Tribunal against the decision and finding within two months from the com mencement of the Madras Estates (Abolition and ment).
Act, 1960 and if no such appeal is filed, the finding of the Settlement Officer shall be final and no fresh inquiry shall be necessary for taking any proceedings under this Act on the basis of that finding.
" 666 The same Act 20 of 1960 introduced this section in the present Act : "12(1) No notification issued under sub section (4) of section 1 of the principal Act during the period between the 23rd December, 1957, and the commencement of this Act, on the basis of finding recorded in any decision given before the said date by the Settlement Officer, or the Tribunal under section 9 of the principal Act (such finding being to the effect that the inam village become an estate by virtue of the Madras Estates Land (Third Amendment) Act, 1936 (Madras Act XVIII of 1936), shall be deemed to be invalid or ever .to have been invalid merely on the ground (a) that before issuing the notification no fresh inquiry was made by the Settlement Officer under the said section 9 after the said date; or (b) that the landholder or other person aggrieved had No. occasion to appeal to the Tribunal against the decision and finding of the Settlement Officer; and all such notifications issued and actions taken in pursuance thereof during the period aforesaid shall be deemed always to have been validly issued and taken in accordance with law.
(2) No suit or other proceeding challenging the validity of any such notification or action or for any relief on the ground that such notification or action was not validly issued or taken shall be maintained or conti nued in any court, and no court shall enforce any decree or other holding any such notification or action to be invalid or grant any relief to any person.
" The first question that falls for decision is : To what extent and in what circumstances the Civil Court is competent in a suit to go into the question whether a particular village is an "estate"? By virtue of section 9 of the Code of Civil Procedure, the Civil Courts 'have jurisdiction to decide all suits of a civil nature excepting those of which their cognizance,, is either expressly or impliedly barred.
The exclusion of the civil court 's jurisdiction, therefore, is not to be readily assumed unless the relevant statute expressly or by inevitable implication does so.
The question thus further resolves itself into the :issue : How far s.9(1) of the Abolition Act confers exclusive jurisdiction on the Settlement Officer to determine inam estates? This matter is not res Integra.
In Addenki Tiruvenkata Thata Desika Charyulu vs State of Andhra Pradesh, (1) this Court held that there is an express bar to the jurisdiction of the civil court to adjudicate upon the question, whether "any inam village" is an "inam 1.
A.I.R. 1964 section C. 807 667 estate" or not, and that ,to the extent of the question stated in section 9(1), the jurisdiction of the Settlement Officer and of the Tribunal are exclusive ".
It was pertinently added that this exclusion of the jurisdiction of the civil court would be subject to two limitations.
First, the civil courts have jurisdiction to examine into cases where the provisions of the Act have not been complied with or the statutory tribunal has not acted in conformity with the fundamental principles of judicial procedure.
The second is as regards the exact extent to which, the, powers of statutory tribunals are exclusive.
The question as to whether any particular case falls under the first or the second of the above categories would depend on the purpose of the statute.
and its general scheme, taken in conjunction with the scope of the enquiry entrusted to the tribunal set up and other relevant factors.
Applying the above principles, the Court clarified the limits of the respective jurisdictions of the Settlement Officer/Tribunal and the civil.
court, thus : the object of the Act is to abolish only "inam estates".
This determination involves two distinct matters in view of the circumstances that every "inam village" is not necessarily "an inam estate" viz., (1) whether a particular property is or is not an "inam village" and (2) whether such a village is "an inam estate" within the definition of section 2(7).
The first of these questions whether the grant is of an "inam village" is referred to in section 9(1) itself as some extrinsic fact which must preexist before the Settlement Officer can embark on the enquiry contemplated by that provision and the Abolition Act as it stood at the date relevant to this appeal, makes no provision for this being the subject of enquiry by the Settlement Officer .
Where therefore persons appearing in opposition to the proceedings initiated before the Settlement Officer under section 9 question the character of the property as not falling within the description of an "inam village", he has of necessity to decide the Issue, for until he holds that this condition is satisfied he cannot enter on the further enquiry which is the one which by section 9(1) of the Act he is directed to conduct.
On the terms of section 9 (1), the property in question being an "inam village" is assumed as a fact on the existence of which the competency of the Settlement Officer to determine the matter within his jurisdiction rests and as there are no words in the statute empowering him to decide finally the former be cannot confer jurisdiction on himself by a wrong decision on this preliminary condition to his jurisdiction.
Any determination by him of this question, therefore, is (subject to the result of an appeal to the Tribunal) binding on the parties only for the purposes of the proceedings under the Act, but no further.
The correctness of that finding may be questioned in any subsequent legal proceeding in the ordinary courts of the land where the question might arise for decision.
" 668 Now let us approach the problem in hand in the light of the principles enunciated in Desika Charyulu 's case (supra).
Mr. Natesan, learned Counsel for the appellants, contends that in the instant case, the decision, dated September 2, 1950, of the Settlement Officer fell within the second category of cases pointed out in Desika Charyulu 's case (supra) which could be challenged in the civil court, because, firstly, Kadakalla village was not an "inam village" as the, ,grant was not of the whole village, and the Settlement Officer had grievously erred in assuming it to be so; secondly, as soon as the Settlement Officer reached the finding that the village was not an "inam estate" within the then extant definition in section 2(7) of the Abolition Act, he became functus officio and had no further jurisdiction under section 9(1) to proceed with the enquiry and hold that it was an estate" under section 3(2)(d) of the Estates Land Act, 1908.
In reply, Mr. P. Rameshwara Rao, learned Counsel for the respondents, maintains that under section 9(1), the Settlement Officer had the jurisdiction to determine all the three facts, namely : (1) whether Kadakalla was an 'inam village '; (2) if so, whether it was a pre 1936 'inam estate ' falling under the definition in section 2(7) of the Abolition Act, or (3) a post 1936 'inam estate ' under section 3(2)(d), of the 1908 Act.
The decision of the Settlement Officer, according to the learned Counsel, as to fact No. (1) was conclusive and operated as res judicata under section 64 A, of the Abolition Act, between the parties, be,cause before the Settlement Officer, it was no body 's case that Kadakalla was not an "inam village".
In these circumstances, the decision of the Settlement Officer not being in excess of his jurisdiction, could not be questioned in a civil court.
The argument, though seemingly attractive, does not stand a close examination and we are unable to accept it.
On the other hand, we find force in what has been contended from the appellants ' side.
Under the Abolition Act, as it stood at the material date, the enquiry by the Settlement Officer could legitimately be confined to the ascertainment of only two issues of fact, viz.(1) Was Kadakalla an "inam village" ? (2) if so, was it an 'inam estate ' as defined in section 2 (7) of the Abolition Act? Once issue (2) was determined, the enquiry would be complete and the limits of his exclusive jurisdiction ,circumscribed by section 9(1) reached; and, if he went beyond those limits to investigate and determine further something which was unnecessary or merely incidental or remotely related to issue (2), then such incidental or unnecessary determination, could be questioned in the civil court.
Again, any finding recorded by the Settlement Officer regarding the property in question being an 'inam village ' or not, is not final or conclusive it being a finding of a jurisdictional fact, only, the preexistence of which is a sine qua non to the exercise of his exclusive jurisdiction by the Settlement Officer.
Investigation as to the existence or otherwise of this preliminary fact is done by the Settlement Officer to ascertain whether or not he has jurisdiction to determine that the particular property is an 'inam estate '.
If upon such investigation, he 669 finds that the property is 'an 'inam village ', the foundation for the exercise of his exclusive jurisdiction is laid, and he can then, and then only, embark upon the enquiry envisaged by the statute.
If such investigation reveals that the property is not an 'inam village ', the con dition precedent to the exercise of such jurisdiction by him, would be lacking.
The Legislature must have visualised that under the cloak of an erroneous finding as to the existence or nonexistence of this prerequisite, the Settlement Officer may illegally clutch at jurisdiction not conferred on him, or, refuse to exercise jurisdiction vesting in him.
Perhaps, that is why the statute does not leave the final determination of this preliminary fact to the Settlement Officer/Tribunal and his erroneous finding on that fact is liable to be question in civil court.
The contention of Mr. Rao that before the Settlement Officer the fact of Kadakalla village being an "inam village" was not disputed, does not appear to be home out by the record.
A perusal of the.
Settlement Officer 's order dated September 2, 1950, would show that it was contended before him on behalf of the Inamdars "that there was no village at all at the time of grant" and "that there were more than one grant as Inam in the village".
Assuming for the sake of argument that the appellants had failed to contest or adduce proof before the Settlement Officer that Kadakalla was not an 'inam village ', then also, we fail to appreciate how, on Principle that would make the case any different so as to preclude the appellants from reagitating that matter in the civil court.
Once it is held that determination of this fact is not a matter of the exclusive jurisdiction of the Settlement Officer, the appellants cannot be debarred on the basis of any doctrine, of res judicata from getting the matter fully and finally adjudicated by a court of competent jurisdiction.
In view of the above discussion, it is clear that under the law in force at the material time, a suit for a declaration that the decision of the Settlement Officer/Tribunal holding certain properties to be an 'estate ' under section 3 (2) (a) of the, 1908 Act was void, was maintainable on the ground that the suit property was not an 'inam village '.
There can be no dispute that Suit No. 47 of 1953 is of that category and falls well nigh within the ratio of Gosukonda Venkata.
Narasayya vs State of Madras,(1) which was approved by this Court in Desika Charyulu 's case (supra).
The main contention of the appellants in this suit was that the village Kadakalla was not in 'inam village ' as the grant did not comprise the whole village and consequently, it is not an 'estate ' within the definition in s.3 (2) (d) of the 1908 Act.
The trial court accepted this contention and decreed the suit.
The High Court confirmed that decision, holding that when the grant was made (in 1774), it was neither of the whole village nor of a named village within the meaning of Explanation 1 to s.3 (2) (d) of the 1908 Act.
In Original Suit 101 of 1954, also, the relief of rent or damages (1) A. I. R. 670 is conditional and dependent upon and linked up (by an agreement between the parties) with the determination of the main question involved in the former suit.
We have, therefore, no hesitation in coming to the conclusion that the common question in both these suits regarding Kadakalla being an estate or not, on the ground that it was not an inam village, was within the competence of the civil court.
Further point to be considered is : whether the jurisdiction of the civil courts to proceed with and determine the aforesaid suits 'was, in any way, affected by the enactment of Amending Acts 17 and 18 of 1957.
For reasons that follow, the answer to this question, in our opinion, must be in the negative.
It is well settled that ordinarily, when the substantive law is altered during the pendency of an action, rights of the parties are decided according to law, as it existed when the action was begun unless the new statute shows a clear intention to vary such rights (Maxwell on Interpretation, 12th Edn. 220).
That is to say, in the absence of anything in the Act, to say that it is to have retrospective operation, it cannot be so construed as to have the effect of altering the law applicable to a claim in litigation at the time when the Act is passed.
Let us, therefore, see whether there is anything in the Amending Acts 17 and 18 of 1957 which in clear language gives them a retrospective effect.
A plain reading of these Amending Acts would show that there is nothing of this kind in them, which, expressly or by necessary intendment, affects pending actions.
The only major change introduced by Act 17 of 1957 was that it gave to the Government a right to file an appeal to the Tribunal, if it felt aggrieved against the decision of Settlement Officer under sub section
(3) of s.9 of the Abolition Act, within one year from the date of the decision, or, if such decision was rendered before December 23, 1957 i.e. the commencement of Act 17 of 1957, within one year from such date.
It further entitled the Government to get its appeal, if any, dismissed, as incompetent, by the Tribunal restored within one year of the commencement of the Amending Act.
Likewise, the only effect of the Amending Act 18 of 1957 was that it enlarged the definition of 'inam estate ' for the purpose of Abolition Act by taking in post 1936 Inams.
There is no non obstante clause in.
these Amending Acts of 1957 with reference to pending or closed civil actions.
Nor is there anything in the scheme, setting or provisions of these Amending Acts which fundamentally alters the conditions on which such actions were founded.
No back date or dates of their commencement have been specified in the body of these statutes as was done in Madras Estates Land Amendment Act 11 of 1945 which was expressly enforced with effect from the date of the commencement of Act 18 of 1936.
These Amending Acts were published in the Government Gazette on December 23, 1957, and will therefore be deemed to have come into force 671 from that date only.
The provisions, of these Amending Statutes are not merely Procedural but affect substantive rights,, and impose.
new obligation ' and disabilities.
In them, the Legislature has not spoken in clear language that they would unsettle, settled claims or take away or abridge rights already accrued, or cause abatement of pending actions.
These Amending Acts, 'therefore, can be construed as having a prospective operation only.
They cannot be interpreted as taking away the rights of the litigants in Suits O.S. 47 of 1953 and O.S. 101 of 1954 (which were at the commencement of these Amendments pending at the appellate or original stage) to have their respective claims determined in, accordance with the law in force at the time of the institution of the actions.
Before we come to the Amending Act 20 of 1960, it is necessary to examine whether the decrees in O.S. 47 of 1953 and O.S. 101 of 1954 had attained finality.
And, if so, when and to what extent ? So far as the decree of the High Court (in A.S. 668 of 1954 arising out of O.S. 47 of 1953) is concerned, there is no dispute that it had become final and conclusive between the parti es to that action, namely, the State Government and the present appellants on February 12, 1954.
Learned Counsel are, however, not agreed as to whether the decree, dated March 28, 1958, passed by the civil court in Suit No. 101 of 1954 had also assumed such a character.
Mr. Natesan.
vehemently contended that this decree in so far as it, pursuant to the agreement between the parties, incorporated in it, the final determination of the High Court in A.S. 668 of 1954 that Kadakalla was not an estate was a consent decree, and as such, was final and non appealable in view of section 96(3) of the Code of Civil Pro cedure.
On the respondents ' side Mr. Rao argued that no part of this decree was final and conclusive between the parties on the ground of estoppel or otherwise, because (a) the appellants had in grounds 1 and 2 of the Memo of Appeal presented in the High Court, challenged the decree in its entirety; (b) the joint memo filed by the Advocates, concerned legal issues, including that of jurisdiction.
and as such the agreement was not lawful that would bind the parties; (c) the respondents were not a party to the proceedings in A. section 668 of 1954 and (d) the arrangement arrived at by the Advocates, being dependent on the happening of a future event, did not amount to a lawful adjustment of the claim, and the decree based on it, was inchoate.
None of the points urged by Mr. Rao appears to hold water.
The allegations in grounds 1 and 2 of the Memo of Appeal (which have been referred to in a foregoing part of this judgment) are too vague and general to amount to an averment.
They appear to have been introduced just as a matter of form and habit by the draftsman.
From the Memo of Appeal, read as a whole, it is clear that, in substance and truth,, the challenge was directed only against that part of 3 L748SCI/74 672 the decree which fixed the quantum of rent and damages.
In fact, before the, High Court it was vigorously contended on behalf of the ,appellants that , part of the decree, which, in effect, declared that the village is not an estate ' under section 3 (2) (d), having been imported with the consent of the parties, was not appealable under section 96(3), Code of Civil Proce dure, and, in reality, had not been appealed against.
In support of this contention, reliance was placed on the, Division Bench ,decision in Srinivasa vs Tathachariar(1).
The High Court did not discuss or distinguish this decision.
Nor did it say in so many words that the whole of the decree including the part based on compromise, was under challenge in the appeal.
It rejeited the contention with the remark that it had already "observed that the appeal is but a continuation of the, suit and there could be no estoppel against a statute".
Perhaps, it was assumed that in the Memo of Appeal, every bit of the decree was being challenged by the appellants.
We think, with all respect, that such an assumption was contrary to the well established principle that in construing a pleading or a like petition, in this ,country, the court should not look merely to its form, or pick out from it isolated words or sentences; it must read the petition as a whole, gather the real intention of the party and reach at the substance of the matter.
Thus construed, the Memo of Appeal in this, case could not be said to contain a challenge to that part of the decree which was in terms of the compromise agreement between the parties.
Order 23, Rule 3, Code of Civil Procedure, not only permits a partial compromise and adjustment of a suit by a lawful agreement, but further gives a mandate to the court to record it and pass a decree, in terms of such compromise or adjustment in so far as it relates to the suit.
If the compromise agreement was lawful and, as we shall presently discuss, it was so the decree to the extent it was a consent decree, was not appealable,because of the express bar in section 96,(3) of the Code.
Next point is, whether this agreement was lawful ? We have already discussed that the Amending Acts of 1957 did not affect pending actions in which a declaration is sought that a particular property is not an estate, on the ground that it is not an 'inam village '.
This issue which was intertwined with that of jurisdiction, was very largely a question of fact.
It follows therefrom that in any such suit, the parties in order to avoid unnecessary expense and botheration, could legitimately make an agreement to abide by a determination on the same point in issue in another pending action in an advanced stage.
There was nothing unlawful and improper in such an arrangement particularly when the interests at the respondents were sufficiently safeguarded by the State which was hotly controverting the decree of the trial court regarding Kadakalla being an estate.
By no stretch of reasoning it could be said that this agreement was collusive or was an attempt to contract out of the statute.
There can be no doubt that as soon as the Court accepted the compromise agreement between the parties, and, acting on it, passed a (1) A. I. R. 673 decree in terms thereof, the compromise, to the extent of the matter covered by it, was complete.
Nothing further remained to be done by the parties in pursuance of that agreement.
The decree had become absolute and immediately executable on February 12, 1959 when the High Court in A.S. 668 of 1954 finally decided that Kadakalla was not an estate.
Be that as it may,, the bar to an appeal against a consent decree, in sub section
(3) of section 96 of the Code is based on the broad principle of estoppel.
It presupposes that the parties to an action can, expressly or by implication, waive or forego their right of appeal by any lawful ,agreement or compromise, or even by conduct.
Therefore, as soon as the parties made the agreement to abide by the determination in the ,appeal (A.S. 668) and induced the court to pass a decree in terms of that agreement, the principle of estoppel underlying 196(3) became operative and the decree to the extent it was in terms of that agreement, became final and binding between the parties.
And it was as effective in creating an estoppel between the parties as a judgment on ,contest.
Thus, the determination in A.S. 668 that Kadakalla was not an 'estate ' became as much binding on the respondents, as on the parties in that appeal.
In the view we take, we can derive support from the ratio of this Court 's decision in Raja Sri Sailendra Narayan Bhanja Deo vs State of Orissa(1).
In that case, there was a compromise decree between the predecessors in title of the appellant therein on the one hand, and the Secretary of State on the other, that Kanika Raj was an 'estate ' as defined by Orissa Estates Abolition Act of 1951.
This Court held that the appellant was estopped by the compromise decree from denying that the Raj was not such an 'estate '.
In the light of the above discussion, we would hold that part of the decree in Suit No. 101 of 1954 which was in terms of the compromise agreement had become, final between the parties, and, the appeal from that decree could not be said to be a continuation of that part of the claim which had been settled by agreement.
The combined effect of the two integrated decrees in Suit No. 47 and Suit No. 101, in so far as they, declared that Kadakalla, not being an. 'inam village, was not an estate under section 3(2)(d) of the 1908 Act, was to completely vacate and render non est the decision dated September 2, 1950 of the Settlement Officer.
Against the above background, we have to consider whether the Amending Act 20 of 1960 operates retrospectively to nullify final decrees of civil courts which had before its commencement, declared such decisions of Settlement Officer totally void and nonexistent ? Does the 'Act expressly or by necessary intendment bring into life again all such dead decisions of the Settlement Officer ? In approaching these questions, two fundamental principles of interpretation have to be kept in view.
The first is, that if the Legislature, (1) ; 674 acting within its legislative competence, wants to neutralise or reopen a court 's decision, "it is not sufficient" to use the words of Hidaytullah C.J. in Shri Prithvi Cotton Mills Ltd. vs Broach Borough Municipality(1) "to declare merely that the decision of the Court shall not bind, for that is tantamount to reversing the decision in exercise of judicial power which the Legislature does not possess or exercise.
A court 's decision must always bind unless the conditions on which it is based are so fundamentally altered that the decision could not have been given in the altered circumstances.
" Thus, the first test to be applied is, whether the Amending Act 20 of 1960 has so radically altered the conditions on which the said decrees proceed, that they would not have been passed in the altered circumstances ? The point is that the law which was the basis of the decision must be altered and then, the foundation failing, the binding value of the decision fails when the non obstante clause is superadded.
As shall be presently seen, by this test, the answer to this question must be in the negative.
The second principle to recall the words of Bowen L.J. in Reid vs Reid(2) is, that in construing a statute or "a section in a statute which is to a certain extent retrospective, we ought nevertheless to bear in mind the maxim (that is, except in special cases, the new law ought to be construed so as to interfere as little as possible with vested eights as applicable whenever we reach the line at which the words of the section cease to be plain.
That is a necessary and logical corollary of the, general proposition that you ought not to give a larger retrospective power to a section, even in an Act which is to some extent intended to be retrospective, than you can plainly see the Legislature meant.
" With the above principle in mind, let us now examine the provisions of the Amending Act 20 of 1960.
In this Act, also no back date for its commencement has been mentioned.
It will, therefore, be deemed to have commenced on June 23, 1960, which is the date on which it was published in the Govt.
Gazette.
It does not say (excepting in section 12 inserted by it which obviously does not apply to the facts of this case) that the amendment would have effect and would be deemed always to have had effect from the inception of the parent Act, nor does it use any equivalent expressions or similar words which are usually found in Amending Acts intended to have retrospective operation without any limit. ' Section 9 A inserted by this Amending Act in the parent Act, does not begin with any non obstante cause, whatever having reference to decrees or orders of civil courts.
In terms, it concern,s itself only with a certain category of decisions given before the commencement of Act 18 of 1957 by the Settlement Officer/Tribunal, under section 9 of the Abolition Act.
Such decisions are those which were based on the finding that a particular Inam village had become estateby virtue of the.
Madras Estates Land (Third Amendment) Act, 1936.
The Order, dated September 2, 1950, of the Settlement Officer in the instant case, was a decision of this category, inasmuch as he held that.
Kadakalla was not an 'inam estate ' because it was a post 1936 (1) L19701 1 S.C.R. 388.
(2) at 408.
675 inam, and as such, was not covered by the definition in section 2 (7) of the Abolition Act.
But, before the commencement of the Amending Act, 1960, this decision as a result of the High Court 's decree, stood finally vacated.
It is not at all clear from the language of this Amending Act, that the intention was to revive even such legally non existent decisions of the Settlement Officer.
On The contrary, definite indications ire available that the section was not intended to have unlimited retrospective operation.
The first of such indications is available from the marginal heading of section 9 A, itself " which is to the effect : "Inquiry under section 9.
not necessary in certain cases", The heading discloses the purpose as well as the extent of the new provision.
it envisages only such cases in which the decision of the Settlement Officer was not successfully challenged in the civil court on the ground that the parti cular property was not an inam village; for, it would be pointless, only in such cases, to hold a further inquiry into the matter.
The second hint of legislative intent is available in section 64 A (2) which has not been touched by the Amending Act.
Section 64 A(2) provides that the decision of the civil court on any matter within its jurisdiction shall be binding on the parties thereto and persons claiming under them in any proceeding under the Abolition Act before the Tribunal or the Special Tribunal.
If the intention was to exclude the Jurisdiction of the civil court altogether, s.64 A(2) would either have been deleted or drastically amended so as to alter the basic conditions with effect from the very inception of the parent Act, that in the altered Conditions those decisions could not have been rendered by the civil courts.
For instance, it could say that the decision of the Settlement Officer on the question whether a particular property is an 'inam village ' or not, would be conclusive and final and would always be deemed to have been so." In view, of what has been said above, we are of the opinion that s.9 A takes in its retrospective sweep only those decisions of the settlement Officer or the Tribunal which at the commencement of the Amending Act 20 of 1960 were subsisting and had not been totally vacated or rendered non est by a decree of a competent court.
The decision dated September 2, 1950 of the Settlement Officer in the instant case, was not such a decision.
It had ceased to exist as 'a result of the inter linked decree in O.S. 47 of 1953 and O.S. 101 of 1954, passed before the enactment of this Amending Act.
The Amending Act of 1960, therefore, does not in any way, affect the finality or the binding effect.
of those decrees.
Quite, a number of authorities were cited by the learned Counsel on both sides, but it is not necessary to notice all of them because in lost of them the facts were materially different.
Only one of those cases in which the interpretation of sections 9 A and 64 A was involved reserves to be noticed.
It is reported in Yeliseth Satyanarayana vs Aditha agannadharab and ors.(1) (1) [1966] I.L.R. A.P. 729.
676 The writ petitioners in that case had challenged the order of the Estates Abolition Tribunal which had held (1) that the previous order of the Civil Court holding the suit lands to be an estate, by virtue of the Amending Act XVIII of 1936 to the Madras Estates Land Act, 1908, was not res judicata under section 64 A of the Abolition Act and (2) that the land holder had a right of appeal under section 9 A of the said Act, and that the inam was not of the whole village and, conse quently, was not an 'estate '.
The first question for consideration by the High Court was, whether the appeal filed by the land holder before the Estates Abolition Tribunal was maintainable, notwithstanding the fact that such an appeal was not entertained earlier by the Tribunal on the ground of its being incompetent.
On the construction of section 9 A(b), this question was answered in the affirmative.
The second question before the High Court was, whether the previous judgments of the Civil Court were res judicata under section 64 A.
The Bench analysed and explained the circumstances in which the first or the second sub s of section 64 A operates.
It will be useful to extract those observations here "The bar under section 64 A is applicable in two sets of circumstances; one, where the decision was of a Tribunal or Special Tribunal or of a Judge of the High Court hearing a case under section 51; (2) the other, where it is a decision of a Civil Court on any matter falling within its jurisdiction.
The decisions mentioned in the first category are binding on the Civil Courts and the decisions mentioned in the second category are binding on the Tribunal or Special Tribunal or a Judge of the High Court when he hears a case under section 51 (2).
In so far as the facts of this case are concerned, it is sub section (2) of section 64 A that is applicable." On the second question, the learned Judges held that the previous decisions of the Civil Court could not operate as res judicata because the issue as to whether the suit property was an estate under the Amending Act of 1957, was not under contest.
Both the parties as a matter of concession, had conceded that fact and the Government.
was not a party to the proceeding.
In these peculiar circum stances, it was held that the 'concession or assumption made in the previous proceedings, was not a 'decision ' within the meaning of section 64 A(2).
In the case before us, as already observed, the State had contested this issue regarding Kadakalla being an estate or not, right upto the High Court.
It would, therefore, operate as res judicata between the State and the land owners.
The same binding effect is produced by estoppel raised by the consent decree in the suit out of which the present appeal has arisen.
Thus, this ruling does not, advance the case of the respondents.
For all the foregoing reasons, we allow this appeal, reverse the judgment of the High Court and send the case back to it for decision 677 on the remaining issues in accordance with law.
We make no orders as to the costs of this Court.
KRISHNA IYER, J.
The judgment just delivered has my concurrence.
But a certain juristic thought expressed therein and consecrated in an authoritative passage which has fallen from Bowen, L.J., in Reid vs Reid(1) persuades me to break my silence not so much in dissent but in explanatory divagation.
The proposition there expressed and here followed relates to the presumption against vested rights being affected by subsequent legislation.
Certainly this legal creed of Anglo Indian vintage has the support of learned pronouncements, English and Indian.
But when we apply it in all its sternness and sweep, we err.
Precedents should not be petrified nor judicial dicta divorced from the socioeconomic mores of the age.
Judges are not prophets and only interpret laws in the light of the contemporary ethos.
To regard them otherwise is unscientific.
My thesis is that while applying the policy of statutory construction we should not forget the conditions and concepts which moved the judges whose rulings are cited, nor be obsessed by respect at the expense of reason.
Justice Gardozo(2) has in felicitous words made the same point : "There should be greater readiness to abandon an untenable position . when in its origin it was the product of institutions or conditions which have gained a new signifi cance or development with the progress of the years.
In such circumstances, the words of Wheeler, J., in Dwy vs Connecticut Co., , 99,.
express the tone and temper in which problems should be met : "That court best serves the law which recognizes that the rules of law which grew up in a remote generation may, in the fullness of experience, be found to serve another generation badly, and which discards the old rule when it finds that another rule of law represents what should be according to the established and settled judgment of society, Ind no considerable property rights have be come vested in reliance upon the old rule.
It is thus great writers upon the common law have discovered the source and method of its growth, and in its growth found its health and life.
It is not and it should not be stationary, Change of this character should not be left to the,, legislature.
" If judges have woefully misinterpreted the mores of their day, or if the mores of their day are no longer those of ours, they ought not to tie , in helpless submission, the hands of their successors.
" The Indian Constitution, adopting the fighting faith of equal_protection of the laws to all citizens, necessarily contemplates a new jurisprudence where vested rights may be, and often times are, extensively interfered with for achieving the founding fathers ' social goals.
(1) [1886] 31 Ch.
D.402;408.
(2) Cardozo The Nature of Judicial Process; PP.
151 52.
678 Legislative exercises directed towards distributive justice, as in the present case, cannot be considered in the light of a dated value system, though sanctified by bygone decisions of Courts.
However, in the present case, let me hasten to repeat, the Act in question is clear about its intent and its application gives little difficulty.
I have said these words only to enter a mild caveat, on the lines indicated, so as to obviate future misapprehensions about the,rule,of interpretation not to add a new element of judicial sub jectvism.
Speaking generally, courts have to be anchored to well known canons of statutory construction and if they are out of time with the law makers ' meaning and purpose the legitimate means of setting things right is to enact a new Interpretation Act.
P.B.R. Appeal allowed.
[/INST]The appellant took a lease of shop premises from the respondent.
From the time of letting, a chemist 's business was carried on in the shop by S with the occasional help of the appellant.
S and the appellant were living as husband and wife to the knowledge of the respondent.
The respondent applied under section 14 of the Delhi Rent Control Act, 1958, for eviction of the appellant on the ground that she had sublet the premises toS.
The Rent Controller and the Tribunal on appeal held that the appellant and section were living together as husband and wife, and that therefore there wasno question of any subletting by the appellant.
In second appeal, holding that two substantial questions of law were involved namely, one relatingto the status of the appellant as the wife of S, and the other, whether sub lettingwas established, the High Court concluded that there was subletting in favour oOf section Allowing the appeal to this Court, HELD : (1) Under section 39 (2) of the Act the High.
Court could interfere in second appeal only if there was a substantial question of law.
On the question whether the appellant was legally married no finding was necessary in the eviction suit.
It was sufficient for the rent court to proceed on the finding that the appellant and S were living together as husband and wife, whether they were legally married or not.
[528C D, E F] (2)The question whether there was subletting is not a mixed question of law and fact.
In a mixed question of law and fact the ultimate conclusion has to be drawn by applying principles of law to basic findings, but in the determination of a question of fact no application of any principle of law is required in finding either the basic facts or in arriving at the ultimate conclusion.
The question to be determined in the circumstances of this case was whether it was likely that the appellant had sublet the premises to section The negative answer given by the rent court is merely the factual common sense inference which did not call for the application of any principle of law.
[528F G; 529A B] Meenakshi Mills, Madurai vs The Commissioner of Income tax, Madras, ; , followed.
(3)When eviction is sought on the ground of subletting the onus of proving subletting is on the landlord.
If the landlord prima facie shows that the occupant was in the exclusive possession of the premises let out for valuable consideration, it would then be for the tenant to rebut the evidence.
But in the present case the respondent produced no evidence to show subletting in spite of the appellant 's denial in the written statement.
[527C D] Associated Hotels of India Ltd. Delhi vs section B. Sardar Ranjit Singh, ; , followed.
(4)Under section 14 (4) premises could be deemed to have been sub let by the tenant only when the Controller is satisfied that some person is let into possession ostensibly as a partner in business but really for the purposes of subletting.
This provision has no application to the facts and circumstances of the present case.
[526G H]
</s>
|
<s>[INST] Summarize the judgementCivil Appeal No. 722 of 1968.
Appeal by Special Leave from the Judgment and order dated the 17th July, 1967 of the Mysore High Court in Writ Petition No. 989 of 1965.
Narayan Nettar and K. R. Nagaraja for the Appellant.
Mrs. Shyamla Pappu and Vineet Kumar for the Respondent.
The Judgment of the Court was delivered by SARKARIA, J.
The circumstances leading to this appeal, directed against a judgment of the High Court of Mysore, are as follows: The respondent herein entered the service of the Princely State of Mysore in 1935 as Instructor of Tailoring in the Department of Public Instructions.
In 1949, three occupational Institutes (Polytechnics) at Hassan, Devangere and Chintamani were started in the State.
The respondent was sent on deputation to serve in the Polytechnic at Devangere as Instructor in Tailoring and he joined the new post on November 28, 1949.
One Shri K. Narayanaswamy Chetty who was also an Instructor in Tailoring in the Department of Public instruction was also deputed to the occupational Institute at Hassan and joined duty there on December 1, 1949.
This K. N. Chetty was .
far junior to the respondent in service.
Special officer in Charge of the three occupational Institutes considered the names of the respondent and K. N. Chetty for absorption as Instructors in Tailoring and recommended for their absorption with effect from the respective dates of their joining duty, after deputation, in the Institutes.
Accordingly K. N. Chetty was absorbed with effect from December 1, 1949, but no order was passed in the case of the respondent despite repeated representations made by the latter.
In 1953, the then State of Mysore set up the Department of Technical Education and the Polytechnic at Devangere became part of that Department.
The respondent continued tp serve on deputation in that Department.
In 1955, for no fault of the respondent, the Government passed orders reverting him to his parent Department.
On June 11, 1956, the respondent was again posted on deputation as Instructor in Tailoring in the Polytechnic at Bellary "on provisional basis".
The intervening period between his reversion and reposting to the Polytechnic was treated as leave.
On the re organization of States with effect from November 1, 1956, his services were allotted to the new State of Mysore.
The respondent continued to make representations to the effect that like other employees who were taken on deputation from other Departments, he should also be absorbed in the Department of Technical Education with effect from November 28, 1949, which was the date on which he initially came on deputation.
257 His specific grievance was that in any case, he could not be discriminated against and treated differently from K. N. Chetty who was junior to him in the parent Department and came on deputation to the Polytechnic establishment subsequently.
The State Government referred the respondent 's case to the Public Service Commission who examined it and by a communication, dated February 2, 1960, made these recommendations in favour of the respondent: "It is stated in the Government letter dated 26 10 1959 that the Director who was the Unit officer for both the departments ordered the transfer of Sri Srinivasa Murthy who was fully qualified as Tailoring Instructor in the Technical Education Department and there was no need to classify the vacancy post to which he was transferred under the then existing rules.
Along with him Sri K. Narayanaswamy C: Chetty who was his junior and possessing similar qualifications was transferred as Tailoring Instructor in the Technical Education Department and was absorbed in the same department by Government in consultation with the Public Service Commission.
The case of Sri Srinivasamurthy is on all fours with that of Sri Narayanaswamy Chetty and he is deserving of similar treatment.
D ' In view of the above, and since Sri Srinivasa Murthy, who was fully qualified was transferred in 1949 by the Director and appointed as Tailoring Instructor under the rules then in force, and as his reversion at this distance of time for no fault of his would cause a great hardship to him, the Commission are of the opinion that he may be absorbed as Tailoring Instructor from the date of his appointment as such as has been ordered in the case of Sri K. Narayanaswamy Chetty." In the opinion of the Commission, the temporary reversion of the respondent to his parent department in 1955 56, was not justified.
Ultimately, the Government by order, dated February 19, 1964, ordered the absorption of the respondent in the Department of Technical Education in the grade of Rs. 150 with effect from the date of the order, in the vacancy in which he was working, subject to these conditions.
(a) that he would not be entitled to the benefit of revision of scales of pay that had been effected in 1957 & 1961 by way of increments or weightage benefit accruing .
thereunder, (b) that he would not be given any more financial benefit or revision of pay or additional increments for his previous service.
Against this order the respondent made representations to the Government praying that his absorption should be related back to 1949 and he be given the benefit of the revisions of pay scale, including weightage benefit.
The Government did not accept the representation.
258 On April 21, 1965, the respondent filed a writ petition under Article 226 of the Constitution in the High Court, for the issue of a writ of mandamus directing his absorption in the Department of Technical Education from the date of his initial appointment therein, namely, November 28, 1949, and to give him benefits of the revisions of pay scales effected in 1957 and 1961 and weightage benefits thereunder.
The order dated February 19, 1964, was impugned on the ground that he had been invidiously discriminated against in the matter of absorption and appointment, while his junior K. Narayanaswamy Chetty, whose case was identical in all respects, and six other officers who were similarly situated, were absorbed in the Department of Technical Education with effect from the initial date of joining duty on deputation.
It was contended that in making the impugned order, contrary to the recommendations of the State Public Service Commission, the State Government had acted arbitrarily and in violation of Articles 14 and 16 of the Constitution.
The petition was opposed by the appellant, who in its counter affidavit.
contended that the respondent had no legal right to be absorbed in the service of the Department of Technical Education from a particular anterior date, or to be given the revised pay scales applicable to those borne permanently in the service of that Department.
It was further contended that the case of the respondent did not stand on the same footing as that of Narayanaswamy Chetty because the order of Chetty 's absorption was passed in 1951 and that of the respondent 's absorption in 1964, and there was a break in the service of the respondent in the Department of Technical Education, in 1955 56.
It was stated that the absorption of the employees which came on : deputation from a particular date, was a concession which could not be claimed as of right, and consequently, a writ of mandamus, as prayed for by the respondent, should not be issued.
The High Court allowed the writ petition and issued a direction that the absorption of the respondent in the Department of Technical Education, be given effect from November 28, 1949 when he initially resumed duty on deputation to the Polytechnic at Devangere.
The High Court further declared that he will be entitled to all consequential benefits from such absorption including the benefit of revision of pay scales in the years 1957 and 1961 and also weightage benefits.
Hence this appeal by the State.
Mr. Nettar appearing for the appellant contends that this case is fully covered by this Court 's decision in K. V. Rajalakshmiah Setty and Anr.
vs State of Mysore and Anr.
The point canvassed by the Counsel is, that the absorption of K. N. Chetty and five others, with effect from particular anterior dates, was not made in pursuance of any principle of policy or statutory rule, but was done as a matter of concession.
It is urged that Articles 14 and 16 of the Constitution cannot be invoked to enforce a mere concession.
Counsel has further made an attempt to show that the respondent and K. N. Chetty were not similarly situated because there was a break in the respondent 's service with the Department of Technical Education.
(1) ; 259 As against this, Mrs. Shyamla Pappu submits that in Rajalakshmiah Setty 's case (supra), the facts were entirely different.
It is emphasised that in the present case, seven employees had come on deputation from other Departments to the Polytechnics and all of them, excepting the respondent, were absorbed permanently in the Department of Technical Education with effect from the dates on which they came on deputation.
Even Narayanaswamy Chetty, who was admittedly junior to the respondent, and was identically situated, was accorded the same treatment.
It is urged that this principle of policy r was ignored in the case of the respondent, and he was without reason singled out for unfair discriminatory treatment.
It is pointed out that his so called "reversion" to the parent Department in 1958 for a short period, was a misnomer.
It was not a reduction in rank, nor a break in the continuity of his service.
Moreover, it was, as the Public Service Commission found, undeserved and could not, by any stretch of reasoning, be considered a ground for meting out discriminatory treatment to the respondent.
We find a good deal of force in the arguments of the learned Counsel for the respondent.
Rajalakshmiah Setty vs State of Mysore (supra) is clearly distinguishable from the facts of the present case.
In that case, the Government of the then State of Mysore, by a notification dated December 12, 1949, directed that the promotions of 63 petitioners therein, from the post of Surveyors as Assistant Engineers were to take effect from that date irrespective of the dates on which they were put in charge of sub divisions.
But by a notification dated May 17, 1950, the Government showed a concession to a different batch of 41 Surveyors, who had been placed in charge of different sub divisions between March 1944 and January 1946, by promoting them as Assistant Engineers, with effect from the dates of occurrence of vacancies, according to seniority.
In November 1958, another batch of 107 persons were similarly promoted as Assistant Engineers with retrospective effect from 1st November 1956, when the new State of Mysore emerged under the States Reorganization Act.
The petitioners therein filed a writ petition praying for the issue of mandamus directing the State to fix their seniority, also, on the basis that they had become Assistant Engineers from the dates on which the vacancies to which they had been posted had occurred. ' The High Court dismissed petition.
On appeal, this Court ; held that the concession shown to the batch of 41 persons who had been appointed before the petitioners and to the batch of 107 persons who had been appointed thereafter, were mere ad hoc concessions and not something which they could.
claim as of right.
It was observed that there was no service rule which the State Government had transgressed, nor the State had evolved any principle to be followed in respect of persons who were promoted to the rank of Assistant Engineers from surveyors.
It may be noted that the grant of the relief prayed for by the 63 petitioners, would have unsettled and caused wholesale alterations of 260 the seniority list with regard to the entire cadre of Engineers thus affecting persons who were not before the Court and who would have been r condemned unheard.
Further, acceptance of the petitioners ' contentions would have unsettled pre Constitution matters, and it would have been directly productive of results going against section 115(7) of the States Re organization Act.
Furthermore, the petitioners in that case .
claimed to be promoted with ' effect from past dates.
There was no , principle of policy or service rule on the basis of which they could ` claim such promotions as of right. ' Lastly, the petitioners in that case were found guilty of serious laches.
Such impediments in the way of the relief claimed by the respondent, do not exist in the present case.
It appears to us that the acceptance of the respondent 's contentions in the present case cannot lead to any untoward results such as were apprehended in Rajalakshmiah 's case (supra).
Indeed, it has not been shown that the absorption of the respondent with effect from November, 1949, would adversely affect even Narayanaswamy Chetty, who was admittedly junior to him in the parent Department.
On the` other hand, it is an undisputed fact that sit other employees, who were similarly situated, were absorbed from the dates on which they initially joined duty, after deputation to the Polytechnics.
It is not the case of the appellant that this principle whereby the absorption in the Department of Technical Education was related back to the date on which a person initially came on deputation, was ever departed from, excepting in the case of the respondent.
This being the case, the High Court was right in holding that the State Government had evolved a principle "that if a person was deputed to the Department of Technical Education from another department and he stayed on in that other department for a reasonable long time his absorption in that department should be made to relate back to the date on which he was initially sent".
There was no justification whatever to depart from this principle of policy in the case of the respondent, who was, in all material respects, in the same situation as K. N. Chetty.
very rightly, the High Court has held that his "impermissible reversion" for a short while in 1955 to the parent department was no ground to hold that he was not similarly situated as K. Nariayanaswamy Chetty.
This so called reversion to the parent Department for a short period in 1955 56, could not by any reckoning, be treated as a break in his service, this period having been treated as leave.
Nor did it amount u ' to reduction in rank.
In any case, this 'reversion ' was not ordered owing to any fault of the respondent.
It is not the appellant 's case " that the respondent 's work in the Department of Technical Education 261 was found unsatisfactory or that he was not otherwise suitable or qualified to hold the post of Tailoring Instructor in that Department.
That he was suitable to be absorbed in that post, is manifest from the recommendation of the Public Service Commission and is implicit in the impugned order, itself.
For the reasons aforesaid, we are of opinion that in the special circumstances of this case, the High Court was fully justified in granting the relief, it did, to the respondent.
The appeal fails and is dismissed with costs.
P.H.P. Appeal dismissed.
[/INST]The respondents are dealers under the Tamil Nadu Sales Tax Act.
Section 14 of the Central Sales Tax Act declares certain goods enumerated therein of ` ' special importance in inter state trade or commerce.
The list of goods given at serial No. IV reads as under: (IV) Iron and Steel, that is to say (a) pig iron and iron scrap .
(b) iron plates sold in the same form in which they are directly produced by the rolling mill; (c) steel scrap, steel ingots, steel billets, steel bars and rods, (d) (i) steel plates (ii) steel sheets, (iii) sheet bars and tin bars, (iv) rolled steel sections, I mill.
(v) tool alloy steel, J sole in the same from in which they are directly produced by the rolling mill.
The said clause IV was amended by the Central Sales Tax Amendment Act, Act 61 of 1972 by which certain more entries were added.
Section 15 of the Central Sales Tax Act provides that the tax payable under a State Law on sale or purchase of declared goods shall not be levied at more than one stage.
Respondents used to purchase iron scrap and thereafter used to convert them into steel rounds, flats, plates etc.
The scrap was already subject to tax once.
The respondents contended that the entry Iron & Steel was wide enough to include scrap as well as the steel rounds, flats, plates, etc.
made out of the scrap which was subject to tax once and that, therefore, the sale of the steel rounds, flats, plates, etc., cannot be subjected to tax again under the Tamil Nadu Sales Tax Act.
The High Court accepted the contention of the respondents.
Allowing an appeal by certificate, ^ HELD: 1.
The intention was to consider each sub item in clause IV as a separate taxable commodity for purposes of sales tax.
The object was not to lay down that all the categories or sub items of goods specified separately were to be viewed as a single saleable commodity called iron and steel for purposes j of determining a starting point for a series of sales.
The note against sub division of Clause IV makes it clear that even each sub category of a sub item retains its identity as a commercially separate item for purposes of sales tax so long as it retains the sub division.
[171Gm, 172B C] 2.
The expression 'that is to say ' is employed to make it clear and fix the meaning of words to be explained or defined.
Such words are not used, as a rule, to amplify a meaning while removing a possible doubt for which purpose the word 'includes ' is generally employed.
The precise meaning of the words 169 that is to say ' must vary with the context.
The purpose of the expression in a sales A lax law would be to indicate the types of goods each of which would constitute separate class for a series of sales.
[172F H, 173B] 3.
The chemical composition of iron and steel cannot afford a clue to the meaning of iron and steel.
Sales Tax Law taxes sales of goods and is not a taxation on sales of substance out of which goods are made.
We prefer to follow the more natural and normal interpretation which follows plainly from the fact of separate specification numbering of each item.
State of Madhya Pradesh vs Hira Lal; (1966) 17 STC 313 315 distinguished.
The case cf Devidas applied.
[173C. E F] 4.
It has not been shown to, us that any provision of the Tamilnadu Sales Tax Act violates section 15 of the Central Sales Tax Act enacted in accordance with Article 286(3) of the Constitution.
Section 2(j) of the Tamil Nadu Act defines goods and section 4 imposes charge in respect of tax on declared goods.
The Tamilnadu Act borrows clause (IV) of section 14 of the Central Sales Tax Act.
[176 C H] C
</s>
|
<s>[INST] Summarize the judgementAppeals Nos.
50 of 1968 and 1201 of 1970.
From the judgment and Order dated the 20th January 1966, and ' 26th November 1968 of the Madras High Court in Writ Appeals Nos. 1124 of 1963 and 153 of 1966.
K.S. Ramamurthy and section Gopalakrishnan, for the appellant (in both the appeals).
S.V. Gupte and A.S. Nambiar, for respondent Nos. 1 3 (in both ., the appeals).
section Govindaswaminathan, A.V. Rangam, N.S. Sivam and A. Subshashini, for respondent No. 5 (in both the appeals).
B.R. Agrawala, for intervener (in C.A. 50/68).
The Judgment of A.N. Ray, C.J., H.R. Khanna and A. Alagiri swami, JJ. was delivered by Alagiriswami, J.
The dissenting Opinion of ' K.K. Mathew and P.N. Bhagwati JJ.
was delivered by Bhagwati, J. ALAGIRISWAMI, J.
The appellants are the tenants of a property bearing door Nos. 16 and 17 on the Poonamallee High Road in the city of Madras.
They became tenants of this building in May 1929, when the property was with one of the predecessors in title of the present landlords, who are the respondents in these appeals.
Though, the appellants became tenants in 1929 a registered lease deed came into existence only in 1935 under which the lease was to run upto 1 5 1969.
The lessee was entitled to renewal on the same terms, and conditions for another period of fifteen years.
The monthly rent agreed upon was Rs. 225/ and a sum of Rs. 225/ was payable as an annual contribution towards repairs and Rs. 220/ towards public charges and taxes.
In 1949 the parties mutually agreed that the tenants were to pay a 25 per cent increase in rent and also certain other amounts, The present landlords purchased the property in 1962 and soon after filed an application under Section 4 of the Madras (now Tamil Nadu) Buildings (Lease and Rent Control) Act, 1960 for fixation of fair rent.
Thereupon the tenants filed writ Petition No. 1124 of 1963 seeking, to restrain the landlords from proceeding with that petition.
The learned Single Judge who heard the petition felt that in view of a long, series of decisions of Madras High Court under the various Rent Control Acts in force in Madras that they applied also to contractual 632 tenancies in the matter of payment of rent as well as eviction, the matter should be considered by a Full Bench in view of the decisions of this Court in Rent Control cases from certain other States.
The Full Bench after an elaborate consideration came to the conclusion that the Act controls both contractual as well as statutory tenancies, that it is a complete Code, and enables both landlords and tenants to seek the benefit of fixation of fair rent, whether a contractual tenancy prevails or it has been determined.
Thereafter the matter again came up before the same learned Single Judge who, applying the provisions of the Act to the facts of the case held that the Act did not apply to the premises in question.
On appeal by the landlords a Division Bench of the High Court held that the premises were not exempted from the provisions of the Act and the Rent Controller has therefore jurisdiction to entertain and dispose of on merits the application for fixation of fair rent filed by the landlords.
These two appeals ;are against the judgments of the Full Bench (reported in and the Division Bench respectively.
Before we go further into a discussion of the questions that arise :it is necessary to look into certain relevant provisions of the Act.
Clause (6) of section 2 of the Act defines landlord thus : "Landlord" includes the person who is receiving or is entitled to receive the rent of a building, whether on his own account .or on behalf of another or on behalf of himself and others or as an agent, trustee, executor, administrator, receiver or ' .,guardian or who would so receive the rent or be entitled to receive the rent, if the building were let to a tenant;" Clause 8, in so far as it is relevant, defines tenant as follows "tenant" means any person by whom or on whose account rent is payable for a building and includes the surviving spouse, or any son, or daughter, or the legal representative of a deceased tenant who had been living with the tenant in the building as a member of the tenant 's family up to the death of the tenant and a person continuing in possession after the termination of the tenancy in his favour.
Section 4 provides for an application for fixation of a fair rent by the tenant as well as the landlord.
The fair rent for any residential building is to be six per cent gross return per annum on the total cost of the building if it is residential and nine percent if it is nonresidential.
The total cost has to be calculated by taking the cost of const ruction at prescribed rates less depreciation at prescribed rates as well as the market value of the site on which the building stands.
It is to include allowances for such considerations as locality, features of architectural interest, accessibility to market, dispensary or hospital, nearness to the railway station or educational institution and such ,other amenities as may be prescribed.
633 Section 5 provides that when the fair rent of a building has been fixed no further increase shall be permissible except in cases where some addition, improvement or alteration has been carried out at the landlord 's expense and at the tenant 's request.
Similarly,.
if there is a decrease or diminution in the accommodation or amenities provided,, the tenant may claim a reduction in the fair rent.
Section 6 provides for payment of additional sums in cases where the taxes and cesses payable to local authorities are increased.
Section 7 prohibits the landlord from claiming or receiving or stipulating for the payment of any premium or anything in excess of ' fair rent.
It also provides that where a fair rent has not been fixed the landlord shall not claim anything in excess of the agreed rent.
Section 10 deals with the eviction of tenants and lays down the conditions under which an eviction could be asked for.
One of those conditions mentioned in sub section (3) is when the Landlord requires.
a residential building for his own occupation or a non residential building for the purpose of his business.
Clause (d) of sub section (3) provides that where the tenancy is for a specified period agreed upon between the landlord and the tenant, the landlord shall not be entitled to apply under that sub section before the expiry of such period.
Sections 12 and 14 provide for recovery of possession by landlord for repairs or for reconstruction.
Section 17 provides that the landlord is not to interfere with the amenities enjoyed by the tenant.
Section 30 exempts from the provisions of the Act (1) any building the construction of which was completed after the commencement of the Act, and (2) any residential building in respect of which the monthly rent payable exceeds two hundred and, fifty rupees.
We shall refer to other details as and when they become relevant.
The above short analysis of the Act would show that the Act provides for every contingency that is likely to arise in the relationship ,of landlord and tenant.
On behalf of the appellants reliance is placed upon two decisions of this Court, Bhaiya Punjalal Bhagwanddin vs Dave Bhagwat prasad Prabhuprasad ; and Manujendra vs Purendu Prasad ; They are cases dealing with eviction.
In those two cases it was held, broadly speaking, that the provisions of the Acts there under consideration were in addition to and not in derogation of the provisions of the Transfer of Property Act.
There are certain general observations in those two decisions upon which reliance was placed to contend that they apply to cases of fixation of rent also.
The argument was that as it was held in those cases that the Acts did not provide the landlord with additional rights which he did not possess under his contract of tenancy, similarly where there was a subsisting 634 contract of tenancy it is not open .
to the landlord to take advantage of the provisions of the Act to apply for fixation of a fair rent at a figure higher than the contract rent.
We are not called upon in this case to consider whether those two cases were correctly decided.
But we must point out that the general observations therein should be confined to the facts of those cases.
Any general observation ,cannot apply in interpreting the provisions of an Act unless this Court has applied its mind to and analysed the provisions of that particular Act.
We may also point out that in both those cases the contract of 'tenancy was not subsisting.
In a sense, therefore, the observations therein were not really necessary for deciding those cases.
We may also point out that in Rai Brii Raj Krishna vs S.K. Shaw Bros. ; dealing with the Bihar Buildings (Lease, Rent and Eviction) Control Act, 1947 and interpreting section 11 of that Act this Court observed as follows : '. 'Section 11 begins with the words 'Notwithstanding anything contained in any agreement or law to the,contrary ', and hence any attempt to import the provisions relating to the law of transfer of property for the interpretation of the section would seem to be out of place.
Section II is a self contained section, and it is wholly unnecessary to go outside the Act for determining whether a tenant is liable to be evicted or not, and under what conditions he can be evicted.
It clearly provides that a tenant is not liable to be evicted except on certain conditions, and one of the conditions laid down for the eviction of a month to month tenant is non payment of rent." 'Similarly in Shri Hem Chand vs Shrimati Sham Devi (ILR 1955 Punj 36) which dealt with the Delhi and Ajmer Merwara Rent Control Act, section 13(i) of which provided that no decree or order for the recovery of possession of any premises shall be passed by any court in favour of the landlord against a tenant, notwithstanding anything to the contrary contained in any other law or any contract, it was h.
Id that the Act provided the procedure for obtaining the relief of ejectment and that being so the provisions of section 106 of the Transfer or Property Act had no relevance.
Both these cases were referred to in the decision in Bhaiya Punjalal Bhagwanddin vs Dave Bhagwatprasad Prabhuprasad.
Therefore, the following observations in Manujendra ,vs Purendu Prosad that "Rent Acts are not ordinarily intended to interfere with contractual leases and are Acts for the protection of tenants and are consequently restrictive and not enabling, conferring no new rights of action but restricting the existing rights either under the contract or under the general law." should not be held to apply to all Rent Acts irrespective of the scheme of those Acts and their provisions.
The decision of the Madras High 'Court in R. Krishnamurthy vs Parthasarathy (AIR 1949 Mad. 780 1 949 where it was held that section 7 of the Madras Buildings (Lease and Rent Control) Act of 1946 had its own scheme 635 of procedure and therefore there was no question of an attempt to reconcile that Act with the Transfer of Property Act and that an application for eviction could be made to the Rent Controller even before the contractual tenancy was terminated by a notice to quit, should not have been summarily dismissed on the grounds that it was contrary to the decisions of this Court in Abbasbhai 's Case ; and Mangilal 's Case ; and therefore was not a correct law, without examining the provisions of that Act.
Be that as it may, we are now concerned with the question of fixation of a fair rent.
The legislation regarding control of rents started during the Second World War.
In Madras first two orders under the Defence of India Rules were issued as the Madras House Rent Control Orders, 1941 and the Madras Godown Rent Control Order, 1942.
In1945 these orders were reissued with slight changes, as the Madras House Rent Control Order, 1945 and the Madras Non Residential Buildings Rent Control Order, 1945.
These were replaced by the Madras Buildings (Lease and Rent Control) Act, 1946.
Under that Act for the first time both the tenant as well as the landlord were given the right to apply for fixation of a fair rent.
This Act was later replaced by the Madras Buildings (Lease and Rent Control) Act, 1949, which again had a similar provision.
But the important thing to note about the fixation of a fair rent under both these Acts is that the fair rent was related to the rents prevailing in April 1940 and only a fixed percentage of increase from 8 11/3 to 50 per cent depending upon the rent payable was allowed.
The 1960 Act which replaced the 1949 Act adopted a completely new scheme of its own.
It provided for the fixation of a fair rent on the basis of the cost of construction and the cost of land and after allowing for depreciation provided for a return of 6 per cent in the case of residential buildings and 9 per cent in the case of non residential buildings.
It also provided for increase in rent for such factors as locality, nearness to railway station, market, hospital, school etc.
Another significant fact is that all new buildings constructed after 1960 were exempt from the scope of the Act.
Still another departure was that the Act applies, in the case of residential buildings, only if the monthly rent does not exceed Rs. 250.
The Act also provides for fixation of fair rent under the new provisions even though fair rent for the building might have been fixed under the earlier repealed enactments.
All these show that the Madras Legislature had applied its mind to the problem of housing and control of rents and provided a scheme of its own.
It did not proceed on the basis that the legislation regarding rent control was only for the benefit of the tenants.
It wanted it to be fair both to the landlord as well as the tenant.
Apparently it realised that the pegging of the rents at the 1940 rates had discouraged building construction activity which ultimately is likely to affect every body and therefore in order to encourage new constructions exempted them altogether from the provisions of the Act.
It did not proceed on the basis that all tenants belonged to the weaker section of the community and needed protection and that all landlords 636 belonged to the better off classes.
It confined the protection of the Act to the weaker section paying rents below Rs. 250.
It is.
clear, therefore, that the Madras Legislature deliberately proceeded on the basis that fair rent was to be fixed which was to be fair both to the landlords as well as to the tenants and that only the poorer classes of tenants needed protection.
The facile assumption on the basis of which an argument was advanced before this Court that all Rent Acts are intended for the protection of tenants and, therefore, this Act also should be held to be intended only for the protection of tenants breaks down when the provisions of the Act are examined in detail.
The provision that both the tenant as well as the landlord can apply for fixation of a fair rent would become meaningless if fixation of fair rent can only be downwards from the contracted rent and the contract rent was not to be increased.
Of course, it has happened over the last few years that rents have increased enormously and that is why it is argued on behalf of the tenants that the contract rents should not be changed.
If we could contemplate a situation where rents and prices are coming down this argument will break down.
It is a realisation of the fact that prices and rents have enormously increased and there fore if the rents are pegged at 1940 rates there would be no new construction and the community as a whole would suffer that led the Madras Legislature to exempt new buildings from the scope of the Act, it realised apparently how dangerous was the feeling that only "fools build houses for wise men to live in".
At the time the 1960 Act was passed the Madras Legislature had before it the precedent of the Madras Cultivating Tenants (Payment of Fair Rent) Act, 1956.
That Act provides for fixation of fair rent.
It also provides that the contract rent, if lower, will be payable during the contract period.
Even if the contract rent is higher only the fair rent will be payable.
After the contract period is over only the fair rent is payable.
The Madras Legislature having this Act in mind still made only the fair rent payable and not the contract rent if it happens to be lower.
It is clear, therefore, that the fair rent under the present Act is payable during the contract period as well as after the expiry of the contract period.
It was argued that the basis of the decisions in Rai Brij Raj Krishan 's Case and Shri Hem Chand 's Case was the non obstante clause in those two Acts.
But it is well settled that the intention that a legislation should, take effect notwithstanding any earlier legislation on the subject can be both explicit and implicit and that is the Position in the present case.
We do not also feel called upon to refer to the decisions in Glossop vs Ashley , a Newell vs Crayford Cottage Society , and Kerr vs Bryde , nor to the various statements regarding the law in Megarry 's work on the Rent Acts relied upon by Sri K. section Ramamurthy on behalf of the appellants.
They are based on the relevant provisions of the Act,in force in England particularly section 3(1) of the Increase of Rent & Mortgage Interest (Restrictions) Act, 1920 which reads.
637 "Nothing in this Act shall be taken to authorise any increase of rent except in respect of a period during which but for this Act the landlord would be entitled to obtain possession.
" The provisions of the Act under considerations show that the are to take effect notwithstanding any contract even during the subsistence of the contract.
We have already referred to the definition of the terms 'landlord ' and 'tenant ' which applies both to subsisting tenancies as well as tenancies which might have come to an end.
We may also refer to the provision in section 7(2) which lays down that where the fair rent of a building has not been fixed the landlord shall not claim anything in addition to the agreed rent, thus showing that the fair rent can be fixed even where there is an agreed rent.
That is why we have earlier pointed out that the various English decisions which provide for fixation of rent only where the contractual tenancy has come to an end do not apply here.
We may also refer to sub section (3) of section 16 which deals with cases where a landlord requires a residential or non residential building for his own use.
Clause (d) of that sub section provides that where the tenancy is for a term the landlord cannot get possession before the expiry of the term, thus showing that in other cases of eviction covered by section 10 eviction is permissible even during the continuance of the contractual tenancy if the conditions laid down in section 10 are satisfied.
The Madras High Court reviewed all the decisions of this Court ' except the latest one in Manujendra vs Purendu Prosad.
We have already pointed out that the criticism made in that decision regarding Krishnamurthy 's Case was not justified.
We are in agreement with the view of the Full Bench of the Madras High Court that the various decisions of this Court were based upon particular provisions of the Acts.
which were under consideration, mainly the Bombay Act which is vitally different from the Madras Act.
A close analysis of the Madras Act shows that it has a scheme of its own and it is intended to provide a complete code in respect of both contractual tenancies as well as what are popularly called statutory tenancies.
As noticed earlier the definition of the term 'landlord ' as well as the term 'tenant ' shows that the Act applies to contractual tenancies as well as cases of "statutory tenants" and their.
landlords.
On some supposed general principles governing all Rent Acts it cannot be argued that such fixation can only be for the benefit of the tenants when the Act clearly lays down that both landlords and tenants can apply for fixation of fair rent.
A close reading of the Act shows that the fair rent is fixed for the building and it is payable by whoever is the tenant whether a contractual tenant.
or statutory tenant.
What is fixed is not the fair rent payable by the tenant or to the landlord who applies for fixation of fair rent act fair rent for the building, something like an incident of the fair regarding the building.
We have then to deal with Civil Appeal No. 1201 of 1970.The learned Single Judge considering that as the total amount annually in respect of these premises was Rs. 5032/ , which lakhs the rent payable to exceed Rs. 400/ a month, the building was outside 15 M602Sup.
CI 74 638 the scope of the Act and therefore the petition for fixation of fair rent does not lie.
(This provision was removed by an Amending Act of 1964).
The learned Judges of the Division Bench on the other hand held that the agreement of the year 1949 between the landlord and the tenant by which the rent was increased was one in variation of a written contract and therefore evidence of it is barred under section 92 of the Evidence Act.
Clearly any variation of rent reserved by a registered lease deed must be made by another registered instrument.
We are not able to accept the argument of Sri K. section Ramamurthy on behalf of the tenants that the agreement of 1949 was one by the landlord to give up his right to apply for fixation of fair rent in consideration of the additional rent agreed to be paid by the tenant and is, therefore, not covered by section 92 of the Evidence Act.
The correspondence between the parties makes it clear beyond doubt that the agreement was to pay increased rent.
If this agreement is left out of account the rent payable is below Rs. 400/ a month, and, therefore, the decision of the Division Bench is correct.
Before concluding we must refer to one other argument on behalf of the appellants.
Under section 30 of the Act, as originally enacted, any residential building the rent of which exceeded Rs. 250 / per month and any non residential building whose rent exceeded Rs. 400/ a month were outside the scope of the Act.
In 1964 the Act was amended so as to provide that all non residential buildings would be within the scope of the Act.
This amendment was attacked on the ground that it contravened the provisions of article 19(1) of the Constitution.
In view of our finding earlier that this case should be decided on the basis of the monthly rent being below Rs. 400/ this argument does not fall to be considered.
In the result the appeals are dismissed.
The appellants will pay the respondents ' costs.
BHAGWATI J.
We have had the advantage of reading the judgment prepared by our brother Alagiriswami, J., and though we, agree with him in regard to the decision in Civil Appeal No. 1201 of 1970, we find it difficult to assent to the view taken by him in Civil Appeal No. 50 of 1968.
The facts giving rise to the two appeals have been stated clearly and succinctly in the judgment given by our learned brother and we think it would be a futile exercise to reiterate them.
We may straight away proceed to examine the question which arises for consideration in.
Civil Appeal No. 50 of 1968.
The question is whether a landlord can during the subsistence of the contractual tenancy, apply for fixation of fair rent under section 4 of the Tamil Nadu Buildings (Lease and Rent Control) Act, 1960 (hereinafter referred to as the Tamil Nadu Act 18 of 1960).
The determination of this question depends on the true interpretation of certain provisions of the Tamil Nadu Act 18 of 1960 and we may, therefore, refer to those provisions and see what is their proper meaning and effect.
The long title and the preamble of the Tamil Nadu Act 18 of 1960 show that it is enacted "to amend and consolidate the law relating to the regulation of the letting of residential and non residential buildings and the control of rents of such buildings and the preven 639 tion of unreasonable eviction of tenants therefrom in the State of Tamil .Nadu".
See, 2, cl.
(6) gives an inclusive definition of 'landlord ' and according to this definition, 'landlord ' includes "the person who is receiving or is entitled to receive rent of a building, whether on his own account or on behalf of another or on behalf of himself and others or as an agent, trustee, executor, administrator, receiver or guardian or who would so receive the rent or be entitled to receive the rent, if the building were let to a tenant".
Thus the owner of a building which becomes vacant would be 'landlord ' within the meaning of that expression as defined in section 2, cl.
(6) and so also would be the landlord during the subsistence of the contractual tenancy as also after the termination of the contractual tenancy where the tenant continues to remain in possession of the building. 'Tenant ' is defined in section 2, cl.
(8) to mean "any person by whom or on whose account rent is payable for a building and includes the surviving spouse, or any son, or daughter, or the legal representative of a deceased tenant who had been living with to tenant in the building as a member of the tenant 's family up to the death of the tenant and a person continuing in possession after the termination of the tenancy in his favour".
This definition is wide enough to include not only a contractual tenant but also a tenant remaining in possession of the building affect the termi nation of the contractual tenancy.
Section 3 enacts detailed provisions regulating the letting of residential and non residential buildings.
The broad scheme of this section is that when a building becomes vacant, the landlord is required to give notice of the vacancy to the authorised officer and if the building is required "for the purposes of the State or Central Government or of any local authority or of any public institution under the control of any such Government or for the occupation of any officer of such Government", the authorised officer may give necessary intimation in that behalf to the landlord and on receipt of such intimation, the landlord would be bound to deliver possession of the building to the authorised officer or to the allottee named by the authorised officer, as the case may be, and the Government would be deemed to be the tenant of the landlord on such terms as may be agreed upon between the landlord and the Government, or in default of agreement, determined by the Controller.
The rent payable by the Government to the landlord would be the "fair rent, if any, fixed for the.
building under the provisions of this Act and if no fair rent has been so fixed, such reasonable rent as the authorised officer may determine", but "the reasonable rent fixed by the authorised officer shall be subject to such fair rent as may be fixed by the Controller".
Section 4 provides for fixation of fair rent of a building on the application of the tenant or the landlord.
Sub section
(1) of the section is material and it says that "The Controller shall, on, application by the tenant or the landlord of a building and .after holding such inquiry as the Controller thinks fit, fix the fair rent for such building in accordance with the principles set out in subsection (2) or in sub section (3) as the case may be, and such other principles as may be prescribed".
Sub section
(2) lays down the principles for fixation of fair rent of residential building and sub section
(3), for fixation of fair rent of non residential building.
The fiar rent is to be such as would provide 6 % gross_return per annum on 640 the total cost of the building, if it is residential and 9 gross return per annum on the total cost of the building, if it is non residential.
The total cost of the building is to be computed by taking the cost of construction as calculated according to the prescribed rates less depreciation also at the prescribed rates and adding to it the market value of that portion of the site on which the building is constructed and making allowances for such considerations as locality in which the building is situated, features of architectural interest, accessibility to market, dispensary or hospital, nearness to the railway station or educational institution and such other amenities as may be prescribed.
It may be pointed out that under the Madras Buildings (Lease and Rent Control) Act, 1946 and the Madras Buildings (Lease and Rent Control) Act, 1949, which preceded the Tamil Nadu Act 18 of 1960, the scheme of fixation of fair rent was different, in that the fair rent was related "to the prevailing rate of rent in the locality for the same or similar accommodation in similar circumstances during the twelve months period to 1st April, 1940" and only a fixed percentage of increase varying from 8 1/3 % to 50 % was allowed on such rate of rent, depending upon whether it exceeded or did not exceed a certain limit ' But the Legislature while enacting the Tamil Nadu Act 18 of 1960 made a departure from that scheme presumably because it felt that in view of the staggering and disproportionately heavy fall in, the purchasing power of the rupee over the last 30 years, it was most, unrealistic to peg the fair rent to the level of rents prevailing during the period of 12 months prior to 1st April, 1940 and allow only an ad hoc percentage of increase, and therefore, in section 4, sub sections
(2) and (3), it adopted a different basis for fixation of fair rent which would not unduly depreciate the yield permissible to the landlord and at the same time, be not extortionate or exploitative of the tenant.
Now once the fair rent of a building is fixed under section 4, sub section
(1), no further increase in such fair rent is 'permissible except in cases where some addition, improvement or alteration has been carried out at the expense of the landlord and if the building is then in the occupation of a tenant, at his request and similarly, if there is a decrease or diminution in the accommodation or amenities, the tenant may claim reduction in such fair rent.
Vide section 5.
Section 6 provides that where the amount of the taxes and cesses payable in respect of a building to a local authority for any half year commencing on 1st April, 1950 or on any later date exceeds the amount of taxes and cesses payable for the half year commencing on 30th September, 1946 or for the first complete half year after the date on which the building was first let out, whichever is later, the landlord shall be entitled to claim such excess from the tenant in addition to the rent payable for the building.
The consequences of fixation of fair rent are set out in section 7, sub s (1) and (3).
Sub section (1) says that where the Controller has fixed the fair rent of a building "(a) the landlord shall not claim, receive or stipulate for the payment of (i) any premium or other like sum in addition to such fair rent, or (ii) save as provided in section 5 or section 6, anything.
in, excess of such fair rent 641 (b). any premium or other like.
sum or any rent paid in addition to, or in excess of, such fair rent whether before or after the date of the commencement of this Act, in consideration of the grant, continuance or re newal of the tenancy of the building after the date of such commencement, shall be refunded by the landlord to the person by whom it was paid or at the option of such person, shall be otherwise adjusted by the landlord; Provided that where before the fixation of the fair rent, has been paid in excess thereof, the refund or adjustment shall be limited to the amount paid in excess for the period commencing on the date of application by the tenant or landlord under sub section (1) of section 4 and ending with the date of such fixation.
" Sub sec.
(3) declares that any stipulation in contravention of sub section
(1) shall be null and void.
These are the only provisions of the Tamil Nadu Act 18 of 1960 which have a direct bearing on the determination of the question before us, but reference was also made to certain other provisions of that Act dealing with eviction of tenants for the purpose of drawing support by way of an a logical reasoning from the decisions of this Court interpreting those provisions and we must, therefore, briefly advert to them.
Section 10 confers protection on the tenant against eviction "in execution of a decree or otherwise" by providing that he shall not be evicted except in accordance with the provisions of that section or sections 14 to 16.
Sub sections
(2) and (3) of section 10 set out the grounds on which the tenant my be evicted by the landlord.
One of the grounds that set out in cl.
(a) of sub section
(3) is that the landlord requires the building, if residential, for his ,own occupation or for the occupation of his son, and if non residential, for a business which he or his son is carrying on, but in respect of this ground, there is a limitation imposed by cl.
(d) of sub section
(3) that when the tenancy is for a specified period agreed upon between the landlord and the tenant, the landlord shall not be entitled to apply for possession under sub section
(3) before the expiry of such period.
Sections 12 to 14 provide for recovery of possession of the building by the landlord for repairs or reconstruction.
These provisions are not material and we need not refer to them in detail.
Then we go straight to section 30 which exempts certain buildings from the operation of the Act.
Every new building the construction of which is completed after the commencement of the Act is exempted under cl.
The reason obviously is that the legislature wanted to encourage construction of new buildings so that more and more buildings would become available for residential as well as non residential purposes and that would help relieve shortage of accommodation.
(ii) exempts any residential building or part thereof occupied by any tenant, if the monthly rent paid by him exceeds Rs. 250/Here the object of the Legislature clearly was that the the protection of the beneficent provisions of the Act should be available only to ,small tenants paying rent not exceeding Rs. 250/ per mouth, as they 642 belong to the weaker sections of the community and really need protection against exploitation by rapacious landlords.
Those who can afford to pay higher rent would ordinarily be well to do people and they would not be so much in need of protection and can, with,out much difficulty, look after themselves.
It is in the light of these provisions of the Tamil Nadu Act 18 of 1960, that we have to consider whether a landlord can, during the subsistence of the contractual tenancy, apply for fixation of fair rent under.
section 4, sub section
Two basic considerations must guide our approach to this question.
The first is that the agreed rent which is the result of contract between the parties must continue to bind them so long as the contract subsists, unless there is anything in the statute which expressly or by necessary implication overrides the contract, It is true that with the decline of the doctrine of laissez faire and the assumption by the State of a more dynamic and activists role, the principle of sanctity of contract which is one of the pillars of a free market economy, has in a number of cases been eroded by legislation.
But if we examine such legislation it will be apparent that this has happened invariably in aid of the weaker party to the contract.
Where there is unequal bargaining power between the parties, freedom of contract is bound to produce injustice and social legislation therefore steps in and overrides the. contract, with a view to protacting the weaker party from the baneful Consequences of the contract.
It is to contract the injustice resulting from inequality in bargaining power and to bring about social or distributive justice that social legislation interferes with sanctity of contract.
It seeks to restore the balance in the scales which are otherwise weighted in favour of the stronger party which has larger bargaining power.
Ordinarily we do.
not find, and indeed it would be a strange and rather incomprehensible phenomenon, that legislation intervenes to disturb the sanctity of contract for the benefit of a stronger party who does not need the protective hand of the legislature.
This consideration we must constantly keep.
before us while construing the relevant provisions of the Tamil Nadu Act 18 of 1960.
Secondly the Tamil Nadu Act 18 of 1960, as its long title and preamble show, has been enacted inter alia with the object of controlling rents of residential and non residential buildings and preventing unreasonable eviction of tenants.
Now, there can be no doubt that in so far as it is calculated to prevent unreasonable eviction of tenants, the Tamil Nadu Act 18 of 1960 is a protective measure intended to safeguard tenants against indiscriminate eviction by landlords.
Equally, by controlling the rents by keeping them within fair and reasonable limits, the Tamil Nadu Act 18 of 1960 seeks to protect tenants against greedy and rapacious landlords who taking advantage of the great scarcity of housing accommodation which prevails in almost all urban areas, may extract excessive and unconscionable rent from tenants.
The Tamil Nadu Act 18 of 1960 is in its essential character as also in its object and purpose similar to what may conveniently be described as rent control legislation, in other States, such as Maharashtra, Gujarat, West Bengal and Madhya Pradesh.
643 Now it is well settled by decisions of this Court that rent control Acts are "not ordinarily intended to interfere with contractual leases and are Acts for the protection of tenants and are consequently restrictive and not enabling or conferring any rights of action but restricting the existing rights either under the contract or under the general law.
" That is what this Court said in Manuiendra Dutt vs Purendu Prosad Roy Chowdhury & Ors.(1), while dealing with the Calcutta Thika Tenancy Act, 1949.
The same view was taken by this Court in Bhaiya Punjalal Bhagwanddin vs 'Dave Bhagwat Prasad Prabhuprasad(2) in relation to Bombay Rents, Hotel and Lodging House Rates.
Control Act, 1947 which prevails in Maharashtra and Gujarat and which has long title and preamble in almost the same terms as the Tamil Nadu Act 18 of 1960.
This Court said in that case: "the Act,", that is the Bombay Rent Act "intended therefore to restrict the rights which the landlords possessed either for charging excessive rents or for evicting tenants".
The Madhya Pradesh Accommodation Control Act, 1955 was also construed in the same way by this Court in Mangilal vs Sugarchand Bathi.(3) This general purpose and intendment of rent control legislation and its positive thrust and emphasis on the protection of the tenant cannot be lost sight of when we are construing a similar legislation like the Tamil Nadu Act 18 of 1960.
We may now turn to examine the relevant provisions of the Tamil Nadu Act 18 of 1960 against the background of these general considerations.
Section 4, sub section
(1) contemplates that an application for fixation of fair rent of a building may be made by the tenant or the landlord.
The definition of "tenant", as we have pointed out above, includes contractual tenant as well as tenant remaining in possession of the building after determination of the contractual tenancy, that is, statutory tenant, and both contractual tenant and statutory tenant can, therefore, apply for fixation of fair rent under section 4, sub section (1).
The Government, who is deemed to be the tenant of the landlord under section 3, sub section
(5), can also similarly avail of the provision for fixation of fair rent in section 4, sub section
The question is as to who are the persons comprehended within the expression 'landlord ' who can apply for fixation of fair rent under section 4, sub section
The landlord, where the Government is deemed.
to be the tenant under.
section 3, sub section
(5), would certainly be entitled to make such application and, having regard to the wide definition of the expression 'landlord ', which includes not only contractual landlord but also statutory landlord, if one may use that expression to describe the counterpart of statutory tenant, it was common ground between the parties that the statutory landlord can also avail of this provision, but the dispute was whether the contractual landlord is within the ambit of this provision.
Can he apply for fixation of fair rent under section 4, sub section
(1)p ? Now prima facie according to 'the definition as also according to its plain natural connotation, the expression 'landlord ' includes contractual landlord and it might, therefore, appear at first blush, on a purely literal construction, that the contractual landlord can make an application for fixation of fair rent under section 4, sub section
But is well settled that a definition clause (1) ; (2) ; (3) ; 644 is not to be taken as substituting one set of words for another or as strictly defining what the meaning of a term must be under all circumstances, but as merely declaring what may be comprehended within the term, when the circumstances require that it should be so comprehended.
It would, therefore, always be a matter of interpretation whether or not a particular meaning given in the definition clause ,applies to the word as used in the statutory propriety.
That would depend on the subject and the context.
Moreover, it is equally well established that the meaning of words used in a statute.
is to be found, not so much in strict etymological propriety of language, nor even in popular use, as in the subject or occasion on which they are used and the object which is intended to be achieved.
The context, the ,collocation and the object of the words may show that they are not intended to be used in the sense which they ordinarily bear, but are meant to be used in a narrow and limited sense.
Lord Herschell pointed out in Cox vs Hakes (1) "It cannot, I think, be denied that, for the purpose of construing any enactment, it is right to look, not only at the provision immediately under construction, but at any others found in connection with it which may throw light upon it, and afford an indication that general words employed in it were not intended to be applied without some limitation." However wide in the abstract, general words must be understood as used with reference to the subject matter in the mind of the legislature and limited to it.
Thus, in Whethered vs Calcutta(2) a statute which, reciting the inconveniences arising from church wardens and overseers making clandestine rates, enacted that those officers should permit "every inhabitant" of the parish to inspect the rates under a penalty for refusal, was held not to apply to a refusal to one of the church wardens, who was also an inhabitant.
As the object of the statute was to protect those in habitants who had previously no access to the rates (which the church wardens had, the meaning of the term 'inhabitants ' was limited to them.
The same approach in interpretation must be adopted by us in the present case.
We must not allow ourselves to be unduly obsessed by the meaning of 'landlord ' given in the definition or by its ordinary etymological meaning but we must examine the scheme of the relevant provisions of the statute, the contextual setting in which section 4, sub section
(1) occurs and the object which the legislation is intended to achieve, in order to determine what is the sense in which the word 'landlord ' is used in section 4.
sub section
(1) whether it is intended to include contractual landlord.
It is necessary for this purpose to consider what are the consequences of fixation of fair rent, for that furnishes the key to the solution of the problem before us.
The fair rent, when fixed, becomes an attribute or incidence of the building and there can be no change in it except in the circumstances set out in section 5.
When the fair rent is fixed, three possibilities may arise.
The fair rent may be the same as the agreed rent in which case no difficulty arises.
Or the fair rent may be less than the agreed rent.
Where that happens, section 7, sub section
(i), ,el.
(a) operates and it provides that the landlord shall not be entitled to claim, receive or stipulate for payment of anything in excess of the (2) 645 fair rent.
The landlord, can, in such a case, claim, receive or recover only the fair rent and nothing more, despite the contract of tenancy which provides for payment of higher rent.
To that extent sanctity of contract is interfered with by the legislation in order to protect the tenant against exploitation by the landlord so that the landlord may not take undue advantage of shortage of housing accommodation and extract excessive rent from a needy and helpless tenant.
The stipulation in the contract of tenancy for payment of higher rent would in such a case be clearly in contravention of sub section
(1) of section 7 and would be null and void under section 7, sub section
But what happens if the fair rent fixed is higher than the agreed rent? Can the landlord claim to recover such fair rent from the tenant, overriding the contract of tenancy which provides for payment of lesser rent? We do not think so.
There is nothing in section 7 or in any other provision of the Tamil Nadu Act 18 of 1960 which can by any process of construction be read as authorising the landlord to override the contract of tenancy and claim fair rent higher than the agreed rent from the tenant.
If the legislative intent were that, even though the contract of tenancy is subsisting, the landlord should be entitled to recover fair rent higher than the agreed rent, we should have expected the Legislature to say so in so many terms, as it has done in section 7, sub section
(1), cl.
(a) when it wanted the landlord not to be able to recover the agreed rent where it is in excess of the fair rent.
It may no noted that whenever the Legislature intended to confer on the landlord a right to recover any amount which he would not otherwise have under the contract or the general law, the Legislature has done so in clear and specific language as in section 6 of the Act.
But here we do not find any such provision, either express or necessarily implied.
We may also profitably com pare the language of the provision in section 3, sub section
There it is provided that "the reasonable rent fixed by the authorised officer shall be subject to such fair rent as may be fixed by the Controller".
The words "subject to" clearly take in both kinds of cases, where the fair rent fixed is higher as well as lower than the reasonable rent.
in section 7, sub section
(1), cl.
(a), however the Legislature has departed from this phraseology and instead of saying that the agreed rent shall be subject to the fair rent or the rent payable by the tenant shall be the fair rent, the Legislature has merely laid an embargo on the landlord prohibiting him from recovering anything in excess of the fair rent.
This provi sion is clearly, without doubt, restrictive in character.
it is not an enabling provision empowering the landlord to recover the fair rent where it is higher than the agreed rent.
But quite apart from these considerations, there is inherent evidence in section 7 itself which strongly reinforces our interpretation and that is to be found in sub section
That sub section says that any stipulation in.
contravention of sub section shall be null and void.
If, therefore, there is a stipulation in the contract of tenancy for payment of rent higher than the fair rent, it would be invalid.
, Such a stipulation would not be enforceable by the landlord against the tenant.
Only the fair rent would be payable by the tenant.
If, however, there is a stipulation for payment of rent which is less than the fair rent, it would not be in contravention of sub sec.
(1) and hence would not be invalidated by sub section
(3) but would remain 646 enforceable and binding on the parties and if that be so, the landlord would not be entitled to claim the fair rent in breach of such stipulation.
Section 7, sub section
(3) clearly indicates that the stipulation in the contract of tenancy as regards rent is overridden only where the fair rent is less than the agreed rent and not where it is higher than the agreed rent.
This is the only rational construction which, in our opinion, can be placed on the relevant provisions of the Act relating to control of rent.
It is not only compelled by grammar and language, but also accords with the broad general considerations we have already discussed.
It is difficult to believe that the Legislature should have chosen to interfere with contractual rights and obligations in favour of the landlord who is ordinarily, in view of the acute shortage of housing accommodation, in a stronger and more dominating position than the tenant qua bargaining power.
The Legislature while enacting a social legislation could not have intended to confer on the landlord a new right of action a right to override the contract of tenancy and to impose a greater burden on the tenant than that permitted under the contract of tenancy.
It would be a startling proposition to assume that the Tamil Nadu Legislature was so solicitous of the welfare of the landlord, who is admittedly, as a class, stronger party and much more favorably situated in respect of bargaining power than the tenant, that it enacted a provision in the Act for relieving the landlord against the consequences of an unwise contract entered into by him with open.
To take such a view would be to pervert the legitimate end of a social legislation and proselytise its true object and purpose.
These considerations impel us to the conclusion that the Legislature could not have.
intended that the landlord should have the right to apply for fixation of fair rent during the subsistence of the contractual tenancy.
If it was not the intention of the Legislature to benefit the landlord by giving him a right to override the contract of tenancy and claim fair rent higher than the agreed rent from the tenant during the subsistence of the contractual tenancy, it must follow a fortiorari that it could not have been intended by the Legislature that the landlord should have the right to apply for fixation of fair rent whilst the contract of tenancy is subsisting.
Having regard to the basic character of the statute as a rent control legislation and the scheme of its provisions and reading section 4, sub section
(1) in its contextual setting and in the light of the other provisions of the statute, the conclusion is inescapable that the word 'landlord ' in section 4, sub section
(1) is used in a limited sense and it does not include contractual landlord.
The landlord is not given the right to apply for fixation of fair rent during the subsistence of the contractual tenancy.
It is only when the contract of tenancy is lawfully determined that he becomes entitled to, apply for fixation of fair rent, for it is only then that he can recover fair rent higher than the agreed rent from the statutory tenant, there being no contract of tenancy to bind him down to the agreed rent.
We were referred to certain decisions of this Court relating to the interpretation of the provisions of various Rent Control Acts dealing with the eviction ' of tenants.
Some of these decisions have 647 already been noticed by us earlier while discussing the general object and intendment of Rent Control Acts.
They have no direct bearing on the determination of the question before us, but they do lend some support to the view we are taking as to the interpretation of the word 'landlord ' in section 4, sub section
These decisions which are given in reference to Rent Control Acts of Maharashtra, Gujarat, West Bengal and Madhya Pradesh, clearly establish that the Rent Control Acts do not give a right to the landlord to evict a contractual tenant without first determining the contractual tenancy.
So long as the contractual tenancy subsists, the tenant does not need protection because he cannot be evicted in breach of the 'Contract of tenancy.
It is only after the contract of tenancy is determined and the landlord becomes entitled to the possession of the premises, that the tenant requires protection and it is there that the Rent Control Acts step in and prevent the landlord from enforcing his right to possession except under certain conditions.
The Rent Control Acts do not confer on the landlord a new right of eviction, but merely restrict his existing right to recover possession under the contract or the general law.
The landlord cannot, therefore, sue for recovery of possession on any of the grounds recognised as valid by the Rent Control Acts unless he has first determined the contractual tenancy of the tenant.
This view.
which has been taken by the decisions of this Court in regard to the Rent Control Acts of Maharashtra, Gujarat,, West Bengal and Madhya Pradesh, applies equally in regard to the Tamil Nadu Act 18 of 1960.
It is true that the High Court of Madras took a different view in R. Krishnamurti vs Perthasarthi (1) in regard to the Madras Buildings (Lease and Rent Control) Act ' '1945 which was in material respects in almost identical terms as the, Tamil Nadu Act 18 of 1960 and held that section 7 of that Act, corresponding to section 10 of the present Act, had its own scheme of procedure and there was no question of any attempt .to reconcile that Act with the Transfer of Property Act and an application for eviction could, therefore, be made under that Act without terminating the contractual tenancy of the tenant.
But in Manujendra Dutt.
vs Purendu Prosad Roy Choudhury & ors.(2) this decision of the Madras High Court was expressly overruled and held not to be correct law by this Court.
The argument on behalf of the respondents was that the observation of this Court disapproving the view taken by the Madras High Court was a casual observation made without examining the scheme of the Madras Act and no validity could attach to it.
We fail to see how such an argument can possibly be advanced with any degree of plausibility.
It is clear from the dis cussion of the Madras decision which we find in the judgment of Court that the attention of this Court was specifically directed to the reasoning of the Madras decision which proceeded on the basis that section 7 of the Madras Act had its own self contained scheme which excluded the Transfer of Property Act and it was because this Court found the reasoning to be incorrect, that it held that the Madras decision was not good law.
It would not be fair to presume that this Court cavalierly overruled the Madras decision without applying its mind and caring to examine the scheme of the Madras Act.
(1) A.I.R. 1949 Mad.
(2) ; 648 Such a charge cannot be made merely because this Court did not elaborately discuss the merits of the Madras decision but disposed it of in a few words.
The brevity of the discussion does not signify casualness or lack of proper consideration.
We must, in the circumstances, hold that the observation of this Court that the Madras decision cannot be regarded as good law was a deliberate and considered pro nouncement and the view taken by this Court in regard to the Rent Control Acts of Maharashtra, Gujarat, West Bengal and Madhya Pradesh must equally prevail in regard to the Tamil Nadu Act 18 of 1960.
We may point out that in any event we do not find any cogent reason to question the validity of the observation made by this Court disapproving of the Madras decision.
We are wholly in agreement with that observation as we do not see any material difference between the language and the scheme of section 10 of the Tamil Nadu Act 18 of 1960 and the language and scheme of the corresponding provisions of the other Rent Control Acts which came to be construed by this Court.
The only distinctive feature which could be pointed out on behalf of the respondents was the provision in section 10, sub s ' (3), cl.
But that provision does not make any material difference because all that it provides is that though, in a case where the tenancy is for a specified period and it is determined by forfeiture before the expiration of the term, the landlord would have been, but for cl.
(d), entitled to recover possession of the building under cls.
(a), (b) or (c), he shall be precluded from doing so until the expiration of the period for which the tenancy was created.
If there is any other ground available to him for claiming possession, for example, a ground specified in section 10, sub section (2), he can seek to recover possession on that ground and cl.
(d) would not afford the tenant any protection.
But cl.
(d) would stand in the way of the landlord, if possession is sought on any of the grounds set out in cls, (a), (b) and (c).
The object of cl.
(d) clearly is that even though the tenancy has come to an end by forfeiture and the landlord has become entitled to the possession of the building under the general law.
, the tenant shall be protected from eviction on any of the grounds set out in cls.
(a), (b) and (c) so long as the period for which the tenancy was created in his favour has not a expired, This construction receives considerable support from the tact that the Legislature has used the words "before the expiry of such period" and not the words "before the determination of the tenancy" to indicate the length of time for which protection is given to the tenant under cl.
We do not therefore think that it would be right to infer from cl.
(d) that, save in cases falling within that provision, the landlord would be entitled to apply for possession under sub section
(2) or sub cl.
(3) of section 10 without determining the tenancy of the tenant.
There can be no doubt, having regard to the judicial pronouncements of this Court, that the word 'landlord ' in section 10 of the Tamil Nadu Act 18 of 1960 :is used in a limited sense to refer only to a landlord who has terminated the tenancy of the tenant and does not include a contractual landlord.
if the ' word 'landlord ' in section 10 is found subjected to a limitation excluding a contractual landlord, it forms a strong argument for subjecting the word 'landlord ' in s.4.,sub s.(1) also to the like limitation.
649 It may also be noted that, whatever be the correct interpretation of the word 'landlord ' in section IO, it is clear from the decisions of this Court in regard to the other Rent Control Acts.
that it is not at all unusual,, having regard to the object and purpose of Rent Control legislation, to read the word 'landlord ' in a limited.
sense so as 'to exclude contractual landlord and we are therefore not doing anything startling or extraordinary but merely following the path eked out by the decisions of this Court when we place a limited meaning on the word 'landlord 'in section 4, sub section
(1) which would exclude contractual landlord.
That is in fact in conformity with the object and purpose of the Tamil Nadu Act 18 of 1960, which, to quote the words used by this Court in P.J. Irani vs State of Madras (1) in reference to the earlier Tamil Nadu Act 25 of 1949 which was in material respects in identical terms as the present Act, is intended to protect "the rights of tenants in occupation of buildings from being charged unreasonable rates of rent" and not to benefit landlords by conferring on them a new right against tenants which they did not possess before.
Since we are of the view that it is not competent to the landlord to apply for fixation of fair rent under section 4, sub section (1) during the subsistence of the contractual tenancy, we set aside the decision of the High Court of Tamil Nadu which has taken the view that the Controller has jurisdiction to entertain the application of the respondents and allow Civil Appeal No. 50 of 1968.
There will be no order as,.
to costs all throughout.
ORDER In accordance with the opinion of the majority, the appeal is dismissed.
The appellant will pay the respondents costs.
[/INST]The appellant, a judicial officer, was convicted and sentenced under the , by a Full Bench of the Orissa High Court.
Registrar of Orissa High Court vs Bardakanta Mishra & Ors.
I.L.R. [1973] Cuttack 134.
The appellant 's career as a judicial officer was far from satisfactory.
When he was working as Additional District and Sessions Judge he showed gross indiscretion and committed grave judicial misdemeanor.
The contempt proceed ings arose out of the representation he made to the Governor for canceling the order of suspension passed against him by the High Court and the allegation he made in a memorandum of appeal he had filed earlier in the Supreme Court.
In his representation to the Governor the appellant made false insinuations that the Governor cancelled the previous disciplinary proceedings against him on the ground that the same was vitiated as the High Court prejudged the matter and the government set aside the punishment because three of the judges were biased and were prejudiced against him, that the proceeding involved the Government in heavy expenses on account of the "palpably incorrect views of the High Court", that the High Court did not gracefully accept the Government 's order cancelling his demotion, that the High Court resorted to "subterfuge ' to counteract the said decision of the government by taking a novel step and that the High Court 's action suffered from patent mala fides.
He stated that the other judges had no independent judgment of their own and were influenced by the Chief Justice to take a view different from what they bad already taken and characterised the High Court as an "engine of oppression" and his order of suspension as "mysterious".
In another representation made to the Governor the appellant alleged that the High Court on the administrative side was seriously prejudiced and biased against him and it acted as if the charges stood established requiring extreme punishment and as such justice May not be meted out to him by the High Court, if it conducted the departmental inquiry.
He also stated that he considered it risky to submit his explanation to the High Court and that the High Court in the best interests of justice, should not inquire into these charges again st him.
He suggested that "the Court was not in a position to weigh the evidence and consider the materials on record and impose a sentence commensurate with his delinquency.
" The action taken by the High Court was branded as "unusual".
A copy of this representation was sent to the High Court with the remark that since the High Court was likely to withhold the representation it was submitted direct to the Governor.
In the memo of appeal filed in the Supreme Court, the appellant alleged bias and prejudice against the High Court and its Chief Justice.
He took the plea that the High Court had become disqualified to deal with the case and expressed the view that "the judges of the High Court had fallen from the path of rectitude and were vindictive" and had decided to impose substantive sentence and that "they were not in a position to mete even handed justice '.
In appeal to this Court.
it was contended : (i) that the passages about which the complaint was made did not amount to contempt of court since they did not purport to criticize any 'judicial, acts of the judges and criticism of the administrative acts of the High Court even in vilification terms did not amount 28 3 to contempt of court, and (ii) that the acts complained of were in the court of the appellant challenging his suspension and holding of disciplinary proceedings, in an appeal or representation to the Governor from the orders of the High Court and he gave expression to his grievance or had otherwise acted not with a view to malign the court or in defiance of it but with, the sole object of obtaining the reversal of the orders passed by the High Court against him.
HELD : The imputations have grossly vilified the High Court tending to affect substantially administration of justice and, therefore, the appellant was rightly convicted of the offence of criminal contempt.
[304F] (i)Proceedings in contempt are always with reference to administration of justice.
All the three sub clauses of section 2(c) of the , define contempt in terms of obstruction or interference with administration of justice and scandalisation within the meaning of sub clause (1) must be in respect of the court or the Judge with reference to administration of justice.
[297C D] Debi Prasad Sharma vs The King Emperor.
70 Indian Appeals.
216, referred to.
(a)The question whether contemptuous imputations made with reference to the administrative acts of the High Court amount to contempt of court will depend upon whether the amputations affect the administration of justice.
This is the basis on which the contempt is punished and must afford the necessary test.
[298E] (b)The mere functions of adjudication between the parties is not the Whole of administration of justice for any court.
The presiding judge of a Court embodies in himself the Court.
and when engaged in the task of administering justice is assisted by a complement of clerks and ministerial officers.
The Acts in which they are engaged are acts in aid of administration of justice.
Therefore, when the Chief Justice appoints ministerial officers and assumes disciplinary control over them, that is a function which through described as administrative, is really in the course of administration of justice.
Judical integrated function of Judge and cannot suffer any dissection nuance of high standards of rectitude in judical administration administration is an so far as maintain concerned.
The whole set up of a court is for who ' purpose of administration of justice and the controlwhich the judge exercises over his assistants has also the object of maintaining the purity of administration of justice.
[298F H; 299A] (c)The disciplinary control over the misdemeanors of the subordinate judiciary in their judicial administration is a function which the High Court must exercise in the interest of administration of justice.
It is a function Which is essential for the administration of justice in the wide connotation it has received and, therefore, when the High Court functions in a disciplinary capacity, it Only does so in furtherance of administration of justice.
it is as important for the superior court to be vigilant about the conduct and behaviour of the subordinately judge as it is to administer the law, because both functions are essential administration of justice.
The Judge of the superior court in whom this disciplinary control is vested functions as much as a Judge in such, matters as when he bears and disposes of cases before him.
[300E; 299D] (d) What is commonly described as an administrative function has been when vested in the High Court, constantly regarded by statutes as a function in the administration of justice.
[299F G] Letters Patent for the High Courts of Bombay, Calcutta and Madras a. 8; High Courts Act, 1861, a. 9; the Government of India Act, 1935, %.
224; Constitution of India, 1950, articles 225, 227 235; State of West Bengal V.Nripendra Nath Bagchi ; referred to.
(e)Thus the courts of justice in a State froth the highest to the lowest are by their constitution entrusted with functions directly connected with the administration of justice and it is the expectation and confidence of all those who have or likely to 'have business there that the courts Perform all their functions 284 on a high level of rectitude without fear or favour, affection or ill will.
And, it in this traditional confidence in the courts that justice will be administered in them which is Fought to be protected by proceedings in contempt.
[300F G] Rex vs Almon [1765] Wilmot 's Notes of Opinions 243, referred to.
(f) Scandalisation of the court is a species of contempt and may take several forms.
A common form is the vilification of the Judge.
When proceedings in contempt are taken for such vilification the question which the court has to ask is whether the vilification is of the Judge as a Judge or it is the vilification of the Judge as an individual.
If the latter, the Judge is left to this private remedies and the court has no power to commit for contempt.
If the former, the court will proceed to exercise the jurisdiction with scrupulous care in cases which are clear and beyond reasonable doubt.
Secondly, the court with have also to consider the degree of harm caused.
as affecting administration of justice and if it is slight and beneath notice, courts will not punish for contempt.
Ibis salutary practice is adopted by section 13 of the .
If the attack on the Judge functioning as a Judge substantially affects administration of justice it becomes a public mischief punishable for contempt, and it matters not whether such an attack is based on what a Judge is alleged to have done in the exercise of his 'administrative ' responsibilities.
A Judge 's functions may be divisible, but his integrity and authority are not divisible in the context of administration of justice.
[301D F] Queen vs Gray, [1900] (2) Queen 's Bench, 36, at page 40, referred to.
(g)"Judicial capacity" is an ambivalent term which means "capacity of or properto a Judge" and is capable of taking in all functional capacities of a Jurodge whetheradministrative, adjudicatory or any other, necessary for the administration of justice.
There is no warrant for the narrow view that the offence of scandalisation of the court takes place only when the imputation has reference to the adjudicatory functions of a Judge in the seat of justice.
[302D] Rex vs Almon [1765] Wilmot 's Notes of Opinion 243; MOti Lal Ghose and Others, XLV Calcutta, 169, The State of Bombay vs Mr. P.
A.I.R. 1959 Bombay, 182, Debi Prasad Sharma vs The King Emperor, 70, Indian Appeals, 216, Special Reference from the Bahama Islands, A.C. 138 at 144, Queen vs Gray , referred to.
Brahma Prak ash Sharma and others vs The State of Uttar Pradesh, [1953] S.C.R. 1169, Gobind Ram vs State of Maharashtra.
and State vs The Editors and Publishers of Eastern Times and Prajatantra, , held inapplicable.
(ii)If in fact the language used amounts to contempt of court it will become punishable as criminal contempt.
The right of appeal does not give the right to commit contempt of court nor can it be used as a cover to bring the autho rity of the High Court into disrespect and disregard.
[298C D] Jugal Kishore vs Sitamarhi Central Co.op.
; referred to.
Per Bhagwati & Krishna Iyer, JJ : (Concurring in ultimate decision) : The dilemma of the law of contempt arises because of the constitutional need to balance, two great but occasionally conflicting principles freedom of expression and f air and fearless justice.
It is a moot point whether we should still be bound to the regal moorings of Rex vs Almon.
[306E] (i)The emphasis in Ss. 2(c), 3 and 13 of the .
to the interference with the course of justice or obstruction of the administration of Justice or scandalising or lowering the authority of the Court not the Judge highlights the judicial area as entitled to inviolability and suggests a functional rather than a personal or 'institutional ' immunity.
The unique power to punish for contempt of itself inheres in a Court qua court, In its essential role of dispenser of public justice.
The phraseological image projected 285 by the catena of expressions in the Act, the very conspectus of the statutory provisions and the ethos and raison d 'eire of the jurisdiction point to the conclusion that the text of the Act must take its colour from the general context and confine the contempt power to the judicial cum para judicial areas, including such administrative functions as are intimately associated with the exercise of judicial power.
In short the accent is on the functional personality which is pivotal to securing justice to the people.
Purely administrative acts like recruitmerits, transfers and postings, routine disciplinary action against subordinate staff, executive acts in running the establishment and ministerial business ancillary to office keeping these are common to all departments in the public sector and merely because they relate to the judicial wing of government cannot enjoy a higher immunity from criticism.
The quintessence of the contempt power is protection of the public, not judicial personnel.
If the slant on judict poalisation as a functional limitation on the contempt jurisdiction is accepted, it must exclude from its ambit interference with purely administrative acts of courts and non judicial functions of judges.
This dichotomy is implicit in the decided cases.
To treat as the High Court has done.
"the image and personality of the lush Court as an integrated one" and to hold that every shadow that darkens it is contempt is to forget life, reason and political progress.
The basic 'public duty" of a Judge in his "judicial capacity" is to dispense public justice in Court and anyone who obstructs or interferes in this area does so at his peril.
Likewise, personal behaviour of judicial personnel, if criticised severally or even sinisterly. cannot be countered by the weapon of the contempt of court.
[309C E, 3 10 A F] The paramount but restrictive jurisdiction to protect the public against substantial interference with the stream of justice cannot be polluted or diffused into an intimidatory power for the judges to strike.
at adverse comments on administrative, legislative (as under articles 225, 226 and 227) and extra judicial acts.
Commonsense and principle can certainly accept a valid administrative area so closely integrated with court work as to be stamped with judicial character such as constitution of benches, transfer of cases, issue of administrative directions regarding submission of findings or disposal of cases by subordinate courts and the like.
Not everything covered by article 225, 227 and 235 will be of this texture.
Thus even though Judges and courts have diverse duties functionally and historically and jurisprudentially, the value which is dear to the community and the function which deserves to be pardoned off from public molestation is judicial.
Vicious criticism of personal and administrative acts of Judges may indirectly mar their image and weaken the confidence of the public in the judiciary but the countervailing good, not merely of free speech but also of greater faith generated by exposure to the acting light of bona fide even if marginally overzealous, criticism cannot be over looked.
[315B E] In the instant case the suspension of the District Judge was so woven into and integrally connected with the administration of justice that it can be regarded as not purely an administrative act but a para judicial function.
The appeal was against the suspension which was a preliminary to contemplated disciplinary action which was against the appellant in his judicial capacity for acts of judicial misconduct.
The control was, therefore, judicial and hence the unbridled attack on the High Court for the step was punishable impugned conduct of the condemner was qua Judge and the evil a supervisory act of the High Court.
[315G H] (ii)A large margin must be allowed for allegations in remedial representation; but extravagance forfeits the protection of good faith.
[315H] In the matter of a Special Reference from the Bahama Islands, ; 149; Debi Prasad Sharma vs The King Emperor, [1942] 70 I.A. 216, Kayiath Damodaran vs Induchoodan, A.I.R. 1961 Kerala 321, K. L. Gauba 's case, I.L.R. [1942] Lab.
411, 419, Rex vs B. section Nayyar, A.I.R. 1950 All '.
555, In re section B. Sarbadhicary, [1906] 14 XX I.A. 41, Brahma Prakash Sharma vs State of Uttar Pradesh, , State V. N. Nagamani, A.I.R. 1959 Pat. 373 and In the matter of an.
Advocate of Allahabad, A.T.R. 1935 All. 1, referred to.
28 6 Remedial process cannot be a mask to malign a judge.
Irrelevant or unvarnished amputations under the pretext of grounds of appeal amount of foul play and perversion of the legal process.
In the instant case the appellant, a senior officer who professionally weighs his thoughts and words has no justification for the immoderate abuse he has resorted to.
In this sector even truth is no defence, as in the case of criminal insult in the latter because it May produce violent breaches and is forbidden in the name of public peace, and in, the former it may demoralise the community about courts and is forbidden in the interest of public justice as contempt of court.
The Court being the guardian of the people 's rights, it has been held repeatedly that the contempt jurisdiction should be exercised with scrupulous care and only when the case is clear and beyond reasonable doubt.
[317C E; 318H] State of Uttar Pradesh vs Shyam Sunder Lal, A.I.R. 1954 All.
308, Rex vs R. section Nayyar, A.I.R. 1950 All. 549; 554, State of Madhya Pradesh vs Ravi Sharker. ; Govind Ram vs State of Maharashtra, , Swarnamayi Panigrahi vs B. Nayak, A.I.R. 1959 Orissa 89, Quintin Hogg.
1206 7.
C. K. Paphtary vs O. P. Gupta, A.I.R. 1971 S.C. 1132 1141 para '52, R vs Gray,, , Special ,Reference No. 1 of 1964; , 501; referred to.
(iii)In sum, the key note word is 'justice, not 'judge '; the 'key note thought is unobstructed public justice, not the self defence of a judge; the corner stone of the contempt law is the accommodation of two constitutional values the right of free speech and the right to independent justice.
The ignition of con, tempt action should be substantial.
and mala interference with fearless judicial action, not fair comment or trivial reflections on the judicial process and personnel.
[319E]
</s>
|
<s>[INST] Summarize the judgementSpecial Leave Petition (Civil) Nos.
6887 88 of 1987.
From the Judgment and Order dated 5.2.
1987 of the Andhra Pradesh High Court in Writ Appeal Nos. 892 and 893 of 1983.
P.R. Ramachandra Rao, Dr. D.Y. Chandrachud, P.H. Parekh and M.K.S. Menon for the Petitioner.
V.J. Rao and Y. Prabhakara Rao for the Respondents.
The Order of the Court was delivered by VENKATARAMIAH, J.
The question arising for decision in this case is whether an employer whose establishment is governed by the Andhra Pradesh Shops & Establishments Act, 1966 (hereinafter referred to as 'the State Act ') is re quired, while retrenching any worker, to comply with the provisions of section 25F of the (hereinafter referred to as ' the central act ') or with section 40 of the State Act.
The petitioner in this case is a co operative society carry ing on 732 business at Vijayawada in the State of Andhra Pradesh.
It retrenched nine of its clerks Respondents 1 to 9 herein.
Respondents 1 to 4 Were retrenched on 1.10.1978 and Respond ents 5 to 9 were retrenched on 22.9.
1978 on the ground that the business of the management did not warrant the continu ance of its heavy establishment.
All the respondents chal lenged the orders terminating their services in an appeal filed under section 41(1) of the State Act before the appel late authority.
The appellate authority set aside the orders of retrenchment by nine separate judgments delivered on August 1, 1979 and directed the reinstatement of the re spondents with full back wages.
Aggrieved by the decision of the appellate authority the management, the petitioner herein, filed nine appeals before the Labour Court, Guntur under section 41(3) of the State Act.
The Labour Court allowed the appeals filed against Respondents 5 to 9 and set aside the orders which had been passed by the first appel late authority.
It, however, dismissed the appeals filed against Respondents 1 to 4 holding that the orders of re trenchment were bad in law since employees junior to these respondents had been retained in service.
It, however, directed that any amount paid to Respondents 1 to 4 as notice pay and gratuity etc.
under section 40 of the State Act on account of the termination of their services may be deducted from the back wages payable to them.
Aggrieved by the decision of the Labour Court Respondents 5 to 9 filed Writ Petition No. 163 of 1981 on the file of the High Court of Andhra Pradesh and the management, the petitioner herein, filed Writ Petition No. 6151 of 1980 before the High Court against Respondents 1 to 4.
The learned Single Judge who heard the said two writ petitions dismissed Writ Petition No. 163 of 1981 filed by Respondents 5 to 9 and allowed Writ Petition No. 6151 of 1980 filed by the management against Respondents 1 to 4.
The learned Single Judge took the view that Respondents 5 to 9 could not claim the benefit of section 25F of the Central Act in a proceeding initiated under section 41 of the State Act and dismissed their writ petition.
He, however, allowed the writ petition filed by the management and remanded the case to the Labour Court to reheat the case after permitting Respondents 1 to 4 to implead four other employees, namely, Seetharamaiah, Rajago pal Rao, Krishna Murthy and Khader Hussain, who were alleged to be seniors to Respondents 1 to 4 and hearing them on the question of inter se seniority between them and the said four other employees.
The learned Judge, however, observed that if section 25F of the Central Act was applicable to the cases 'I have no doubt that these orders of termination would have to be set aside, because section 25F denies the rights of the employer to terminate the service of an em ployee without payment of retrenchment compensation ' and that compensation had 733 not been paid in accordance with section 25F.
But he found that section 25F of the Central Act was not applicable to proceedings under the State Act.
Aggrieved by the decision of the learned Single Judge Respondents 1 to 4 and Respond ents 5 to 9 filed Writ Appeal Nos.
892 Of 1983 and 893 of 1983 respectively before the Division Bench of the High Court.
The common contention urged by both the groups of employees, who were appellants in these two appeals, was that the question of their retrenchment, was governed by section 25F of the Central Act and since the orders of retrenchment had not been passed in conformity with the provisions of section 25F of the Central Act the said orders were liable to be Set aside and they were entitled to be reinstated.
The Division Bench accepted the above contention of Respondents 1 to 9 and allowed both the appeals holding that the orders of termination were unsustainable.
Aggrieved by the decision of the Division Bench of the High Court the petitioner has filed these Special Leave Petitions under Article 136 of the Constitution.
The only question which arises for decision in this case, as mentioned above, is whether the retrenchment of an employee in an establishment governed by the State Act is governed by the provisions of section 40 of the State Act or by the provisions of Chapter V A of the Central Act which deals with lay off and retrenchment.
For purposes of conven ience section 40 of the State Act is set out below: "40.
Conditions for terminating the services of an employee and payment of gratuity: (1) No employer shall without a reasonable cause and except for misconduct terminate the serv ice of an employee who has been in his employ ment continuously for a period of not less than six months without giving such employee, at least one month 's notice in writing or wages in lieu thereof and in respect of an employee who has been in his employment con tinuously for a period of not less than five years, a gratuity amounting to fifteen days ' average wages for each year of continuous employment.
Explanation: For the purpose of this sub section, (a) the expression 'wages ' does not include overtime wages; (b) the expression 'average wages ' means the daily average of wages for the days an employee actually worked during the thirty days immediately preceding the date of termi nation of service; 734 (c) an employee in an establishment shall be deemed to have been in continuous employment for a period of not less than six months, if he has worked for not less than one hundred and twenty days in that establishment within a period of six months immediately preceding the date of termination of the service of that employee; (d) where the total continuous employment is for a fraction of a year or extends over a fraction of a year in addition to one or more completed years of continuous employment, such fraction, if it is not less than a half year shall be counted as a year of continuous employment in calculating the total number of years for which the gratuity is to be given.
(2) Where a gratuity is payable under sub section (1) to an employee, he shall be entitled to receive his wages from the date of termination of his service until the date on which the gratuity so payable is actually paid subject to a maximum of wages for two months.
An employee, who has completed the age of sixty years or who is physically or mentally unfit having been so declared by a medical certificate, or who wants to retire on medical grounds or to resign his service, may give up his employment after giving to his employer notice of at least one month in the case of an employee of sixty years of age, and fifteen days in any other case; and every such employee and the dependant of an employee who dies while in service shall be entitled to receive a gratuity as provided in sub section (1).
He shall be entitled to receive the wages from the date of giving up the employment until the date on which the gratuity so pay able is actually paid, subject to a maximum of wages for two months.
(4) The services of an employee shall not be terminated for misconduct except, for such act or omissions and in such manner, as may be prescribed.
" Sub section (1) of section 40 of the State Act imposes a restriction on the right of the employer of an establishment governed by the State Act to terminate the services of an employee.
It says that an employer shall not without a reasonable causes (except for miscon 735 duct) terminate the service of an employee who has been in his employment continuously for a period of not less than six months without giving such employee, at least one month 's notice in writing or wages in lieu thereof and in respect of on employee who has been in his employment con tinuously for a period of not less than five years, a gratu ity amounting to fifteen days ' average wages for each year of continuous employment.
In the case of misconduct neither one month 's notice or wages in lieu thereof nor gratuity need be paid on the termination of his services.
There are no other restrictions on the right of the management to terminate the services of an employee in an establishment governed by the State Act which is enacted by the State legislature in exercise of the powers conferred on it under Entry No. 22 of List III of the Seventh Schedule to the Consititution.
The Central Act was enacted by the Central Legislature before the commencement of the Constitution and it is also traceable to an Entry in the Government of India Act, 1935 corresponding to Entry No. 22 of List III of the Seventh Schedule to the Constitution.
When the Central Act was originally enacted, it merely provided for investigation and settlement of industrial disputes by establishing a machinery for collective bargaining, mediation and concilia tion, investigation, arbitration, adjudication and other allied matters.
Chapter V A lay off and retrenchment, making provision for payment of compensation for lay off, retrenchment and closure and on transfer of undertakings was not there.
It was introduced by way of amendment in the year 1953.
Sections 25F, 25G, 25H and 25J of the Central Act which are relevant for purposes of this case read as fol lows: "25F. Conditions precedent to retrench ment workmen.
No workman employed in any industry who has been in continuous service for not less than one year under an employer shall be retrenched by that employer until (a) the workman has been given one month 's notice in writing indicating the reasons for retrenchment and the period of notice has expired, or the workman has been paid in lieu of such notice, wages for the period of the notice: Provided that no such notice shall be necessary if the retrenchment is under an agreement which specifies a date for the termination of service; (b) the workmen has been paid, at the time of retrenchment, compensation which shall be equivalent to fir 736 teen days ' average pay for every completed year of continuous service or any part thereof in excess of six months; and (c) notice in the prescribed manner is served on the appropriate Government or such authority as may he specified by appro priate Government by notification in the Official Gazette." "25G. Procedure for retrenchment.
Where any workman in an indus trial establishment, who is a citizen of India, is to be retrenched and he belongs to a particular category of workmen in that estab lishment, in the absence of any agreement between the employer and the workman in this behalf, the employer shall ordinarily retrench the workman who was the last person to be employed in that category, unless for reasons to be recorded the employer retrenches any other workman." "25H. Re employment of retrenched workmen.
Where any workmen are retrenched, and the employer proposes to take into his employ any persons, he shall, in such manner as may be prescribed, give an opportunity to the retrenched workmen who are citizens of India to offer themselves for re employment, and such retrenched workmen who offer themselves for re employment shall have preference over other persons." "25J. Effect of laws inconsistent with this Chapter.(1) The provisions of this Chapter shall have effect notwithstanding anything inconsistent therewith contained in any other law [including standing orders made under the ].
Provided that where under the provi sions of any other Act or rules, orders, notifications issued thereunder or under any standing orders or under any award, contract of service or otherwise, a workman is entitled to benefits in respect of any matter which are more favourable to him than those to which he would be entitled under this Act, the workman shall continue to be entitled to the more favourable benefits in respect of that matter, no withstanding that he receives benefits in respect of other matter under this Act.
737 (2) For the removal of doubts, it is hereby declared that nothing contained in this Chapter shall be deemed to affect the provi sions of any other law for the time being in force in any State insofar as that law pro vides for the settlement of industrial dis putes, but the rights and liabilities of employers and workmen insorfar as they relate to lay off and retrenchment shall be deter mined in accordance with the provisions of this Chapter." Section 25F of the Central Act deals with the conditions precedent to retrenchment of workmen non compliance with which will be fatal to any order of retrenchment.
Section 25G of the Central Act prescribes the procedure for re trenchment and under it an employer shall ordinarily re trench a workman in accordance with the rule of 'last come, first go ' unless for reasons to be recorded the employer retrenches any other workman.
Section 25H of the Central Act requires the management to show preference to retrenched workmen over others, where any workman is retrenched and the management proposes to take into its employ any person again for work, where the retrenched workman offers himself for re employment.
This indeed is a substantial right.
Section 25J of the Central Act which is very material for our pur pose provides that provisions of Chapter V A of the Central Act shall have effect notwithstanding anything inconsistent therewith contained in any other law including standing orders made under the Industrial Employment (Standing Or ders) Act, 1946.
The proviso to sub section (1) of section 25J of the Central Act provides that where under the provi sions of any other Act or rules, orders, notifications issued thereunder or under any standing orders or under any award, contract of service or otherwise, a workman is enti tled to benefits in respect of any matter which are more favourable to him than those to which he would be entitled under the Central Act, the workman shall continue to be entitled to the more favourable benefits in respect of that matter, notwithstanding that he receives benefits in respect of other matter under the Central Act.
Sub section (2) of section 25J of the Central Act is more categorical as re gards the effect of Chapter V A of the Central Act on any other law which may be in force in any State.
It provides that nothing contained in Chapter V A of the Central Act shall be deemed to affect the provisions of any other law for the time being in force in any State insofar as that law provides for the settlement of industrial disputes, but the rights and liabilities of employers and workmen insofar as they relate to lay off and retrenchment shall be determined in accordance with the provisions of Chapter V A of the Central Act.
738 The learned Single Judge who decided the writ petitions formulated three points for his consideration, namely, (i) whether Respondents 1 to 9 were 'workmen ', (ii) whether the management could be treated as an 'industry ' and (iii) whether the three conditions laid down by section 25F of the Central Act would be applicable to the proceedings under the State Act.
He found that both the authority under section 41(1) of the State Act and the authority under section 41(3) of the State Act had proceeded on the assumption that the Central Act was applicable to proceedings under the State Act.
On a consideration of the submissions made on behalf of the management, the learned Single Judge felt that it was not possible to hold that Respondents 1 to 9 were not 'wor kmen ' and, the management was not an 'industry ' as defined in the Central Act.
Having said so the learned Single Judge proceeded to decide the third question namely whether sec tion 25F of the Central Act could be enforced under the provisions of the State Act.
The learned Single Judge held that 'there is no scope either in the language of section 40 or its implication making it obligatory to read the condi tion of section 25F as a part of section 40 of the Shops and Establishments Act. ' Then he proceeded to hold that since the conditions under section 40 of the State Act had been fulfilled in the case of the Respondents 5 to 9, the termi nation was legal.
But in the case of Respondents 1 to 4 since it had been alleged that their juniors had been al lowed to continue in service the learned Judge felt that the matter required further consideration and hence remanded the case because he was of the view that the above question had to be decided before recording a finding on the question whether the termination was for a reasonable cause.
The learned Single Judge was however of the view that if section 25F of the Central Act was applicable 'I have no doubt that these orders of termination would have to be set aside because section 25F denies the right of the employer to terminate the services of an employee without payment of retrenchment compensation. ' The learned Single Judge gave the following reasons for holding that section 25F was not applicable to proceedings under the State Act: (i) that the statutory authorities created under section 41(1) and sec tion 41(3) of the State Act being creatures of the statute had no right to apply the provisions of section 25F of the Central Act to proceedings before them, and (ii) that where as the rights under the Central Act could be agitated by a reference to a Labour Court, the right agitated under sec tion 41(1) and section 41(3) was a personal right.
We find it difficult to agree with the learned Single Judge on both these grounds.
It is already seen that the learned Single Judge has found that the Respondents were 'workmen ' and the management was an 'industry ' as defind in the Central Act.
We have explained earlier 739 the effect of section 25J of the Central Act.
Sub section (1) of section 25J of the Central Act lays down that Chapter V A shall have effect notwithstanding anything inconsistent therewith contained in any other law.
The proviso to that sub section however saves any higher benefit available to a workman under any law, agreement or settlement or award.
Sub section (2) of section 25J however makes a distinction between any machinery provided by any State law for settle ment of industrial disputes and the substantive rights and liabilities arising under Chapter V A of the Central Act where a lay off or retrenchment takes place.
It provides that while section 25J would not affect the provisions in a State law relating to settlement of industrial disputes, the rights and liabilities of employers and workmen insofar as they relate to lay off and retrenchment shall be determined in accordance with Chapter V A of the Central Act.
It is thus seen that section 41(1) and section 41(3) of the State Act prescribe alternative authorities to settle a dispute arising out of a retrenchment.
Those authorities may exer cise their jurisdiction under the State Act but they have to decide such dispute in accordance with the provisions of Chapter V A.
The learned Single Judge omitted to notice the effect of section 25J of the Central Act.
Sub section (2) of section 25J of the Central Act which makes the procedure for securing relief under section 41(1) and (3) of the State Act available to a workman emphasises that the rights and li abilities arising out of retrenchment shall be decided in accordance with Chapter V A of the Central Act.
The said rights can be enforced by a workman personally by himself filing an appeal under section 41(1) of the State Act.
It is not necessary that a reference should be sought under the Central Act by collective action of workers.
The effect of section 25J(2) of the Central Act has been considered by this Court in Sawattain Ramprasad Mills Co. Ltd. vs Baliram Ukandaji and Another, ; In that case the question for decision was whether the C.P. and Berar Indus trial Disputes (Settlement) Act, 1947 was applicable to the case involving the determination of the rights and liabili ties of the management and workmen in the case of lay off or whether the provisions of Chapter V A of the Central Act were applicable.
The Court found that the C.P. and Berar Industrial Disputes (Settlement) Act, 1947 contained no provisions either for recovery of money or for compensation for lay off and held that if a workman had a claim arising in a lay off it could only be dealt with under the Central Act.
In that case no question similar to the one involved here was however in issue.
In Pest Control India Pvt. Ltd. vs The Labour Court, Guntur and Another, [1984] 1 Andhra Weekly Reporter 277 the Andhra Pradesh 740 High Court has very recently laid down that in considering whether the termination of service of an employee by way of retrenchment is legal or justified, it is open to the au thority under section 41 of the State Act to determine whether section 25F and section 25G of the Central Act were complied with or not and to set aside the orders of termina tion and to grant appropriate relief if it is found that there was no compliance with sections 25F and 25G of the Central Act.
The Division Bench of the High Court while reversing the decision of the learned Single Judge has relied on the above decision.
We shall now proceed to consider the merits of the contention that the State Act which is a later Act and which has received the assent of the President should prevail over the provisions of Chapter V A of the Central Act.
The above contention is based on Article 254(2) of the Constitution and the argument is that the provisions of section 40 which deal with termination of service, in a shop or an establish ment contained in the State Act which is enacted by the State Legislature in exercise of its powers under Entry 22 of List III of the Seventh Schedule to the Constitution being repugnant to the provisions contained in Chapter V A of the Central Act which is an earlier law also traceable to Entry 22 of the List II1 of the Seventh Schedule to the Constitution should prevail as the assent of the President has been given to the State Act.
It is true that the State Act is a later Act and it has received the assent of the President but the question is whether there is any such repugnancy between the two laws as to make the provisions of the Central Act relating to retrenchment ineffective in the State of Andhra Pradesh.
It is seen that the State Act does not contain any express provision making the provisions relating to retrenchment in the Central Act ineffective insofar as Andhra Pradesh is concerned.
We shall then have to consider whether there is any implied repugnancy between the two laws.
Chapter V A of the Central Act which is the earlier law deals with cases arising out of lay off and retrenchment.
Section 25J of the Central Act deals with the effect of the provisions of Chapter V A on other laws incon sistent with that Chapter.
Sub section (2) of section 25J is quite emphatic about the supremacy of the provisions relat ing to the rights and liabilities arising out of lay off and retrenchment.
These are special provisions and they do not apply to all kinds of termination of services.
Section 40 of the State Act deals generally with termination of service which may be the result of misconduct, closure, transfer of establishment etc.
If there is a conflict between the spe cial provisions contained in an earlier law dealing with retrenchment and the general provisions contained in a later law generally dealing with terminations of service, the existence 741 of repugnancy between the two laws cannot be easily pre sumed.
In Maxwell on the Interpretation of Statutes, (12th Edn. ) at page 196 it is observed thus: "Now if anything be certain it is this, "said the Earl of Selborne L.C. in The Vera Cruz, at p. 68 "that where there are general words in a later Act capable of reasonable and sensible application without extending them to subjects specially dealt with by earlier legislation, you are not to hold that earlier and special legislation indirectly repealed, altered, or derogated from merely by force of such general words, without any indication of a particular inten tion to do so.
" In a later case, Viscount Haldane said: "We are bound . . to apply a rule of construction which has been repeat edly laid down and is firmly established.
It is that wherever Parliament in an earlier statute has directed its attention to an individual case and has made provision for it unambiguously, there arises a presumption that if in a subsequent statute the Legislature lays down a general principle, that general principle is not to be taken as meant to rip up what the Legislature had before provided for individually, unless an intention to do so is specially declared.
A merely general rule is not enough even though by its terms it is stated so widely that it would, taken by itself, cover special cases of the kind I have referred to.
" We respectfully agree with the rule of construction expounded in the above passage.
By enacting section 25J(2) Parliament, perhaps, intended that the rights and liabili ties arising out of lay off and retrenchment should be uniform throughout India where the Central Act was in force and did not wish that the State should have their own laws inconsistent with the Central law.
If really the State Legislature intended that it should have a law of its own regarding the rights and liabilities arising out of re trenchment it would have expressly provided for it and submitted the Bill for the assent of the President.
The State Legislature has not done so in this case.
Section 40 of the State Act deals with terminations of service general ly.
In the above situation we cannot agree with the conten tion based on Article 254(2) of the Constitution since it is not made out that there is any implied repugnancy between the Central law and the State law.
The result of the above discussion is that if the employees are 742 'workmen ' and the management is an 'industry ' as defined in the Central Act and the action taken by the management amounts to 'retrenchment ' then the rights and liabilities of the parties are governed by the provisions of Chapter V A of the Central Act and the said rights and liabilities may be adjudicated upon and enforced in proceedings before the authorities under section 41(1) and section 41(3) of the State Act.
We may incidentally observe that the Central Act itself should be suitably amended making it possible to an individ ual workman to seek redress in an appropriate forum regard ing illegal termination of service which may take the form of dismissal, discharge, retrenchment etc.
or modification of punishment imposed in a domestic enquiry.
An amendment of the Central Act introducing such provisions will make the law simpler and also will reduce the delay in the adjudica tion of industrial disputes.
Many learned authors of books on industrial law have also been urging for such an amend ment.
The State Act in the instant case has to some extent met the above demand by enacting section 41 providing for a machinery for settling disputes arising out of termination of service which can be resorted to by an individual work man.
In this connection we have one more suggestion to make.
The nation remembers with gratitude the services rendered by the former Labour Appellate Tribunal which was manned by some of our eminent Judges by evolving great legal princi ples in the field of labour law, in particular with regard to domestic enquiry, bonus, gratuity, fair wages, industrial adjudication etc.
The Industrial Disputes (Appellate Tribu nal) Act, 1950 which provided for an all India appellate body with powers to hear appeals against the orders and awards of Industrial Tribunals and Labour Courts in India was repealed in haste.
If it had continued by now the labour jurisprudence would have developed perhaps on much more satisfactory lines than what it is today.
There is a great need today to revive and to bring into existence an all India Labour Appellate Tribunal with powers to hear appeals against the decisions of all Labour Courts, Industrial Tribunals and even of authorities constituted under several labour laws enacted by the States so that a body of uniform and sound principles of Labour law may be evolved for the benefit of both industry and labour throughout India.
Such an appellate authority can become a very efficient body on account of specialisation.
There is a demand for the revival of such an appellate body even from some workers ' organisa tions.
This suggestion is worth considering.
All this we are saying because we sincerely feel that the Central Act passed forty years ago needs a second look and requires a compre hensive amendment.
743 It is not disputed that section 25F of the Central Act has not been complied with in this case and hence the Divi sion Bench of the High Court was right in holding that all the terminations were illegal.
All the respondents are, therefore, entitled to be reinstated in service with furl back wages as held by the authority under section 41(1) of the State Act.
These petitions are dismissed.
P.S.S Petitions dismissed.
[/INST]The appellant made an application before the Rent Con troller on or about July 15, 1976 to let out the premises to the respondent for residential purposes for a period of two years under section 21 of the Delhi Rent Control Act, 1958 as he did not require the premises for that period.
The respondent agreed before the Rent Controller to the above statement of the appellant and undertook to vacate the premises after the expiry of two years from July 15, 1976.
Accordingly, the Rent Controller made an order allowing creation of a limited tenancy for a period of two years from July 15, 1976.
The respondent having refused to vacate the premises after two years, the appellant filed an application under section 21 on behalf of himself and his family members claiming possession of the premises for their bona fide need and use.
The Rent Controller passed an eviction order and the Appellate Tribu nal upheld the same.
The High Court allowing the appeal of the tenant re spondent held that the order under section 21 of the Act was a mindless order inasmuch as no reason had been stated as to why the premises in question was not required for a limited period, that it was not stated as to how the premises in question was dealt with before creating the said tenancy and that there was no writing and no lease registered after the permission was granted.
Allowing the appeal by special leave, 766 HELD: 1.1 The permission granted by the Rent Controller under section 21 of the Delhi Rent Control Act was valid.
The order permitting limited tenancy was not a mindless order but one passed by him after taking the relevant facts into consideration.
[780D] 1.2 In order to attract section 21 of the Act, it is necessary firstly that the landlord must not require the premises either in whole or part for a particular period; secondly, the landlord must obtain the permission of the Controller in the prescribed manner; thirdly, letting of the whole or part of the premises must be for residence, and fourthly such letting out must be for such period as may be agreed in writing.
These and these alone are the conditions which are required to be fulfilled.
[772G 773B] 1.3 Section 21 only gives sanction if the landlord makes a statement to the satisfaction of the Court and the tenant accepts that the landlord does not require the premises for a limited period.
This statement of the landlord must be bona fide.
The purpose must be residence.
There must not be any fraud or collusion.
There is a presumption of regulari ty.
But it is open in particular facts and circumstances of the case to prove to the satisfaction of the executing court that there was collusion or conspiracy between the landlord and the tenant and the landlord did not mean what he said or that it was a fraud or that the tenant agreed because he was wholly unequal to the landlord.
[776F H] 1.4 In the instant case there was no permission previ ously.
This was the first letting.
There was no evidence that when the landlord stated that he did not require the premises in question for a particular period, he did not mean what he said or that he made a false statement.
There was no evidence at any stage that the tenant did not under stand what the landlord was stating or that he did not accept what the landlord stated.
There was no evidence that either the tenant was in collusion or perpetrating any fraud with the landlord or the tenant was unequal to the landlord in bargaining powers.
There was thus no evidence to show that the Controller did not apply his mind.
[779F, 776H 777B] S.B. Noronah vs Prem Kumari Khanna, ; ; Nagindas Ramdass vs Dalpatram Ichharam, ; ; V.S. Rahi and another vs Smt.
Ram Chambeli; , ; J.R. Vohra vs India Export House Pvt. Ltd. and another; , and Smt.
Dhanwanti vs D.D. Gupta, [1986] 3 SCC 1, referred to 2.
It is not necessary to state under section 21 the reasons why the 767 landlord did not require the premises in question for.
any particular period.
The landlord or the tenant may be able to show that cogent reasons did exist or were within the knowl edge of the parties as to why the landlord did not require the whole or a part of his premises for a specified period.
[777BC, 782B] 3.
There is no presumption that in all cases the tenants are the weaker sections.
The presumption is, on the con trary, in favour of sanction.
It is he who challenges the statement and the admission of the landlord or the tenant who has to establish facts.
In the instant case the onus was on the tenant to show that the sanction under section 21 was a nullity.
He did not make any attempt to dislodge the pre sumption in favour of the permission.
[777C, 779F] 4.1 An agreement in writing submitted along with the application under section 21 of the Act is really a proposed agreement.
It comes into effect only after the grant of permission.
It does not require registration.
[782CD] S.B. Noronah vs Prem Kumari Khanna, , referred to.
Vijay Kumar Bajaj vs Inder Sain Minocha, [1982] 2 Rent Control Reporter 392, approved.
4.2 It has been consistently held by the Delhi High Court that section 21 is a code by itself, that the order of permission is itself an authority and that no lease was necessary.
This view has been acted upon for long and trans actions have been completed in the Union Territory on the basis of permission and it was never doubted that there was any requirement of any lease or any agreement subsequent to the order and the same required registration.
The view taken by the High Court over a number of years should normally be adhered to and not to be disturbed.
A different view would not only introduce an element of uncertainty and confusion but it would also have the effect of unsettling transactions which might have been entered into on the faith of those decisions.
[780A C] Raj Narain Pandey and others vs Sant Prasad Tewari & others; , and Kasturi Lal vs Shiv Charan Das Mathur, [1976] 8 Rent Control Reporter 703, referred to.
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<s>[INST] Summarize the judgementCivil Appeal No. 263 of 1982.
Appeal by special leave from the Judgment and order dated the Ist September, 1980 of the Andhra Pradesh Administrative Tribunal Hyderabed in Transferred Petition No. 1663 of 1976.
A. Subba Rao for the Appellant.
P.P. Rao and G.N. Rao for Respondent No. 1.
T. V. R. Tatachari, and A. V. V. Nair for the Respondents, 406 The Judgment of the Court was delivered by DESAI, J.
This appeal by special leave is directed against the decision in Writ Petition No. 1021 of 1975 filed in the Andhra Pradesh High court at Hyderabad which came to be transferred under para 14 (1) of the Andhra Pradesh Administrative Tribunal order 1975 and which was numbered as Transferred Writ Petition No. 1663 of 1976, by which Andhra Pradesh Administrative Tribunal (Tribunal ' for short) allowed the writ petition and quashed the orders permanently absorbing respondents 2 to 10 in the various posts in the office of Deputy Chief Accounts officer, Nagarjuna Sagar Project.
Respondents 2 to 10 in the High Court are the appellants in the present appeal, and original petitioners are respondents 2 to 108.
Deputy Chief Accounts officer is respondent No. 1.
Nagarjuna Sagar Control Board was constituted in the year 1955 charged with a duty to implement N.S. Project.
The Board had the power to recruit required ministerial staff on purely temporary basis.
On August 1, 1959, a decision was taken by the Andhra Pradesh Government to disband the autonomous Board and to convert it into a department of the Government.
On the conversion of the set up of the Board into a department of the Government it became necessary to devise ways and means to absorb the employees recruited by the board.
Number of controversies surfaced and to some extent the present one is one such controversy.
There was an office styled as: The office of the Chief Engineer, N.S. Dam with the Chief Engineer as Head of the Department.
Appellants were serving in the office of the Chief Engineer, N.S Dam Unit.
By the order dated February 8, 1964 appellants were transferred to the office of the Pay and Accounts officer, N.S. Project.
At the time of transfer, appellants were officiating as UDC and were directed to report to the Deputy Chief Accounts officer, N.S. Project to be posted as UDCs.
Since then appellants have been working in the office of the Dy.
CAO and some of them have been even promoted, may be temporarily, to the post of Superintendent.
By the G.O.Ms.
No. 27 PWD dated February 3, 1972, the State Government accorded sanction to the permanent retention of the posts set out in the order with effect from 1.4.1967 in the office of Dy.
Amongst other 38 posts of UDCs were thus made permanent by this order.
The aforementioned order further provided that the posts so made permanent shall be filled in by personnel already working in the Accounts organisation.
It appears that some of the appellants made 407 a representation to the Dy.
CAO for the permanent absorption in A his office.
Ultimately by various orders made in February 1975, appellants were permanently absorbed as UDCs in the establishment of Dy.
CAO and they were given seniority as provided in Rule 27 of Andhra Pradesh Ministerial service Rules The respondents 2 to 108 who were petitioners before the Tribunal were working as UDCs or LDCs since the inception of their career in the office of Dy.
They were initially recruited as LDCs during the period 1959 65.
Some of them were promoted as UDCs from 1961 onwards.
They were aggrieved by the permanent absorption of the present appellants who were respondents in the High Court.
They accordingly filed the writ petition from which this appeal arises, contending that the appellants were holding substantively post of UDC in the office of the Chief Engineer and they were not transferred but sent on deputation in the Pay and Accounts office as per the order dated February 8, 1964 and other like orders by the Chief Engineer, N.S. Dam and they had a permanent lien in the parent department and therefore, they could not be absorbed in the office of the Dy. CAo.
It was, therefore, contended that they may be repatriated to the parent department but in any event even if these are not to be repatriated they could not claim to be absorbed permanently over the respondents who have been since the inception of their career working in the office of Dy.
The specific contention was that the Dy.
CAO not being the Head of the Department, the provision contained in Rule 3 (2) of Andhra Pradesh Ministerial Service Rules, 1961 would not be attracted and therefore the appellants could not be said to have been recruited by transfer and therefore, could not have been absorbed and they had no right to either claim any permanent post or promotion in the office of the Dy. CAO.
The submission was that the permanent retention and absorption of the appellants adversely affected the promotional prospects of the present respondents and the retention and absorption and consequent seniority being contrary to relevant rules must be struck down as invalid The learned member of the Tribunal held that the Dy.
had not the powers of the Head of a Department.
It was not therefore, within his competence to absorb and retain the appellants in his office and confirm them against the posts made permanent by the G.O.Ms. No. 27 dated February 3, 1972.
As a corollary it was held that the various orders made in February 1975 permanently 408 transferring, absorbing and retaining and consequently granting seniority to the appellants were violative of the rules and were struck down.
Hence this appeal by the original respondents 2 to 10 Appellants indisputably were working as UDCs for a period of more than 3 years before they came to be transferred by the Chief Engineer to the office of Dy.
CAO in February 1964.
This order clearly shows that the transfer was for administrative convenience.
No where the orders recite that the transfer was at the request of the transferred personnel The order is the usual short cryptic government order which recites that the UDCs whose names were set out in the order were transferred to P.A.O. 's office, N.S. Project.
The order directs all the transferred UDCs to report for duty to Dy.
CAO, N.S. Project immediately on their relief.
The language of this order leaves no room for doubt that the head of the department under whom the appellants were working transferred them for administrative reasons and for exigencies of service.
Complying with this order, the appellants reported for duty to the Dy.
CAO and since then, except appellant No. 9, the rest of them have been continuously working as UDC and have earned temporary promotion as Superintendent.
So far there is no controversy.
The Tribunal nowhere examined the power of the Chief Engineer, N.S. Dam Project to transfer persons working under him to the office of Dy.
It must therefore, be assumed that he had the power to transfer appellants to the office of the Dy. CAO.
It does not transpire from the record that the transfer was at the request of transferees.
lt does not appear that these persons held the lien in the parent department.
It does not transpire from the record that they were given any proforma promotions in the parent department.
Virtually, since the transfer, they have been treated as part and parcel of the establishment of Dy.
The appellants were holding the post of UDC for a period of more than 3 years prior to their transfer from the offices of the Chief Engineer to the office of the Dy. CAO.
Indisputably, therefore, when they were transferred and occupied the identical post in the office of the Dy. CAO, some of the respondents working in the office of the Dy.
CAO would have been adversely affected because in the absence of the appellants, if it became necessary to have more posts in the 409 category of UDC, obviously some of the LDCs working in the office of the Dy.
CAO could have been promoted.
This becomes manifest from the judgment of a Division Bench of the Andhra Pradesh High Court in Writ Appeal No. 96 of 1970.
After the appellants were transferred, their services were regularised by the Chief Engineer as per his proceedings dated August 11, 1968.
This proceeding was challenged by some of the persons similarly situated like the present respondents on the ground that the present appellants had come on deputation and not on transfer and they cannot be given seniority over those who joined service in N.S. Dam Unit from the inception of their career.
The learned Single Judge dismissed the petition holding that the present appellants were transferred on administrative ground; that the temporary posts which they filled in were converted into permanent posts and the appointments of the appellants in those posts were regularised.
It was held that the transfer was on administrative ground, and therefore, their length of service in the parent department had to be taken into account for the purpose of determining their seniority.
On this finding, the writ petition was dismissed, and the appeal met with the same fate.
Thus the first challenge failed.
Appellants were thus given seniority over respondents in the office of the Dy. CAO.
We have serious doubts whether the Tribunal had jurisdiction to reopen the settled question about the status of the present appellants in the office of the Dy. CAO, which would incidentally be the effect of the judgment of the Tribunal.
We would presently examine the contention which has found favour with the Tribunal and which in our opinion is wholly untenable.
After reciting the various contentions, the Tribunal addressed itself to the question which in its view was a primary question whether the Dy.
CAO was the Head of the Departments.
The Tribunal observed that it is only if it is held to be office of Head of a Department that the transfer of the present appellants in one out of 4 vacancies of UDC under Rule 3 (2) can be justified.
Frankly we are of the opinion that this question hardly arises in this case, in view of the earlier decision of Andhra Pradesh High Court determining the status of the appellants in the establishment of Dy.
However, keeping aside for the time being the decision of the High Court, we would proceed to examine the contention which found favour with the Tribunal on merits 410 The question of ascertaining whether Dy.
CAO was the Head of the Department arises in view of the provision contained in Rule 3 (2) of the Andhra Pradesh Ministerial Rules 1961.
Before we extract rule 3 (2), it may be mentioned that rule 4 provides for recruitment by promotion.
Rule 3 (2) provies that 'besides promotion as provided in Rule 4 the first vacancy out of every four successive substantive vacancies of Upper Division Clerks in the offices of Heads of Department and Directorates shall be reserved to be filled only from among the suitable Upper Division Clerks working in the subordinate offices of the concerned Head of the Department or Directorate. ' There is a proviso which provided that: 'where any Head of the Department or Directorate has no subordinate office under its administrative control, the vacancy shall be filled by a suitable Upper Division Clerk working in the office of any other Head of the Department or Directorate or any other subordinate office, as the case may be, in this service. ' The Tribunal after referring to this rule took notice of the recital in the impugned order dated February 28, 1975 wherein the Dy.
CAO purported to exercise the power under Rule 3 (2) of the Andhra Pradesh Ministerial Service Rules.
The Tribunal therefore, concluded that apart from any other consideration unless all the conditions for attracting Rule 3 (2) are satisfied, the order must fail.
Undoubtedly, before Rule 3(2) could be attracted.
it must be shown that the vacancies in which appellants were absorbed were in the cadre of UDC and were in the office of the Head of the Department.
If it be so, then out of 4 successive substantive vacancies, the first one is to be reserved to be filled in either from amongst suitable Upper Division Clerks working in the subordinate office or if there is no such office, then according to the proviso, from the office of the other Head of the Department of Directorate.
To ascertain whether Dy.
CAO is the Head of the Department, the Tribunal has referred to the definition of the expression 'Head of a Department ' as set out in Article 6 Chapter Ir of the Andhra Pradesh Financial Code Volume 1, which provided that 'Head of a Department ' means 'any authority specially declared by the Government to be the head of a department '.
Assuming that the definition of the expression 'Head of a Department ' 411 in the Financial Code which is relevant to ascertain the financial A powers of a Head of department, holds good for all other powers conferred on a Head of a Department under other rules, this definition merely provides that any one would be a Head of a Department who is specially declared by the Government to be the Department.
The declaration if and when made under the Financial Code would be confined to the Financial Code and unless expressly provided, it cannot be extended to comprehend the Head of Department under other rules.
With this limitation let us examine whether Dy.
CAO is the Head of the Department.
To begin with the Tribunal records a concession by the learned Government Pleader appearing for the Dy.
CAO that no order has been issued declaring the office of the Deputy Chief Accounts officer, Nagarjuna Sagar organisation as Head of Department, we are a little surprised at the stand taken on behalf of the Dy.
CAO in the High Court and in this Court.
In the High Court an affidavit was filed contesting the writ petition filed by the present respondents meaning thereby justifying the order in favour of the appellants.
After the Tribunal quashed the orders and respondents 2 to 10 filed the present appeal, an affidavit has been filed by one Shri T. Venkatanarayana, styling himself as Director of Accounts which seems to be the new designation for the former designation of Dy.
CAO opposing the appeal of the present appellants.
He desires the present appeal to be dismissed on the ground that original transfer orders were only for one year and there was no order extending the period of transfer.
He also stated that R. vs Surya Rao one of the appellants left the organisation of Dy.
CAO on February 9, 1977 and was again taken in the year 1975 at his request.
The stand appears to be self contradictory and it has left us guessing about this volute face.
Out of abundant caution we have decided to keep aside the stand of the Dy. CAo in this behalf.
More so because there is inexplicable silence on the point whether the Dy. CAo was not the Head of the Department.
It is therefore, necessary to independently examine whether Dy.
CAo virtually enjoys the powers of the Head of a Department, so as to be treated as Head of the Department for the purpose of Rule 3 (2).
When the appellants came to be transferred by the Chief Engineer on February 8, 1964, it appears that the office of Dy.
CAO was administratively subordinate to the Chief Engineer, 412 N. section Dam Project.
If it were otherwise, the Chief Engineer could not have transferred the appellants who were borne on his establishment to the office of the Dy. CAO.
As pointed out earlier, the transfers were on administrative ground and certainly not at the request of the appellants.
Further the transferred personnel could not have been considered as on deputation because if a government servant is sent outside his office on deputation, there are certain benefits to which he would be entitled, which in this case are not shown to have been made available to the appellants.
They were transferred from the post of UDC to the corresponding post of UDC.
In 1964 it atleast appears that Dy.
CAO was not the Head of the Department On, May 3, 1966 by G.O.Ms.
No. 178, it was, inter alia, direct that the staff working in the office of Deputy Chief Accounts officer and Pay and Accounts offices may be treated as Ministerial Service and will be given the scales of pay applicable to the staff in the offices of the Heads of Departments.
lt appears that there was difference in the pay scales available to the staff in the office of the Head of the Department and in subordinate offices.
By this G.O. the ministerial staff in the office of Dy.
CAO was held eligible for scales applicable to the staff in the office of the Head of the Department.
This will impart a flavour to the Dy.
CAO as being the Head of Department.
The Governor of Andhra Pradesh made what are styled as ad hoc rules for the temporary posts of ministerial staff in the offices of the Deputy Chief Accounts officer and Pay and Accounts officers under Financial Adviser and Chief Accounts officer 's organisation, Nagarjuna sagar Project, in exercise of the power conferred by the proviso to article 309 of the Constitution.
By Rule 1, the General and special Rules commonly applicable lo the holders of the permanent posts of the respective categories in the Public Works Department in the Andhra Pradesh Ministerial Service were made applicable to the holders of the temporary posts at Superintendents, UDCs, and Typists and Steno typists in the office of the Deputy Chief Accounts officer and Pay and Accounts officers subject to the modifications set out in the subsequent rules.
One such modification worth noticing is that Dy.
CAO was constituted as appointing authority for the aforementioned staff in his office.
Further the Financial Adviser and Chief Accounts officer, 413 under whom Dy.
CAO was directly working, were declared in 1966 A Secretariat Department.
Accordingly Dy.
CAO came directly under the Secretariat Department, and was invested with power of appointing authority which comprehended the power to appoint persons who would for pay scales applicable to staff in the offices of the Heads of Departments.
R It was however contended that G.O.Ms.
No. 335 dated November 1, 1974 would leave no room for doubt that Dy.
CAO is not the Head of the Department.
The preamble of this G.O. reads as under: "In the circumstances stated by the Financial Adviser and Chief Accounts officer, N.S. Project in the N.O. Note read above, the Dy.
Chief Accounts officer, N.S. Project in is delegated with the following powers instead of declaring him as the Head of the Department.
The extent of delegation of power is irrelevant.
It was submitted that the recitals herein extracted would put the matter beyond the pale of controversy that Dy.
CAO was not only not the Head of the Department but as he lacked powers of the Head of the department certain powers had to be specifically conferred upon him.
On the contrary this would justify the belief that 'Head of department ' for Financial Code and for service rules are not terms of co extensive connotation and the have different meaning in different context For example, for service rules the Dy.
CAO is declared an appointing authority, the power usually enjoyed by Head of a department.
But such Head of Department may not be so declared for the Financial Code.
In the G.O. dated November 1, 1974, it was considered unnecessary to declare him Head of a department for Financial Code and, therefore, certain powers had to be conferred upon him.
A perusal of powers would reveal that they were financial powers one can be a Head of the Department but whose financial powers.
may be curtailed under the Financial Code.
Alternately, one may not be a Head of a Department for other purposes and yet may enjoy full financial control if declared to be 'Head of the Department ' for Financial Code.
We are concerned in this case with the meaning of the expression 'Head of a department ' in Rule 3 (2).
In this connection if the Dy.
CAO is shown to be directly working under a secretariat department without intervention 414 of any higher office and if it is declared an appointing authority and the scales admissible to the ministerial service in its office are those admissible to the staff in the office of the Heads of Department, there is no escape from the conclusion that for purposes of Rule 3 (2), he would be the Head of the Department.
We are fortified this conclusion from U. O. Note dated June 11, 1969 of the office of Financial Adviser and Chief Accounts officer which is the secretariat Department under which Dy.
CAO is directly working.
The Relevant portion of the Note may be extracted.
It reads as under: "Hitherto, recruitment to the post of L.D. Clerks, U.D. Clerks, in Deputy Chief Accounts officers organisation, Nagarjun sagar Project was done based on the allotment of candidates who passed Group II.
Services examination of the Andhra Pradesh Public Service Commission, since, the offices of the Deputy Chief Accounts officer and Pay and Accounts officers, N section Project were considered to enjoy the status of the Heads of the Department offices.
In G. O. Ms. No. 178 PWD, Projects Wing, dated 3.5.1966 orders were issued that the office of the Financial Adviser and Chief Accounts officer Nagarjuna sagar Project may be treated as Secretariat and that the staff working in the offices of the Deputy Chief Accounts officers and Pay and Accounts officer may be treated as Ministerial Service and will be given scale of pay applicable to staff in the offices of the Heads of Departments.
Further the adhoc rules issued in G. O. Ms No. 337 PWD Projects Wing dated 24.9.1968 stipulate that the Deputy Chief Accounts officer, Nagarjuna sagar Project is the appointing authority up to the leavel of Superintendents in his organisation.
If there was any lurcking doubt whether the Dy.
CAO is the Head of the Departments, it stands wholly removed by the Note extracted herein above.
It may be recalled that the power to deaclare Head of the Department as defined in the Financial Code vests in the Government and the Government acts on the advise of the concerned Secretariat Department.
The concerned department is of Financial Adviser and Chief 415 Accounts officer, which is declared as the Secretariat Department.
And this note shows that the Secretariat Department meaning thereby the Government treated the Dy.
CAO as the Head of the Department.
Therefore.
for the purpose of Rule 3 (2), there is no room for doubt that Dy.
CAO was the Head of the Department.
If Dy, CAO was the Head of the Department then in view of Rule 3 (2) with regard to the recruitment in the cadre of UDC first out of every four successive substantive vacancies is to be filled in from the subordinate offices and according to the proviso to Rule 3 (2), if there is no subordinate office, from any other office of the Head of the Departments or Directorate.
There is a recital to that effect in the impugned order which was questioned on the short that Dy.
CAO was not the Head of the Department.
Once that ground is out of the way.
The contention of the respondents must fail.
Briefly, we may point out that this very conclusion can be reached by a slightly different process of reasoning.
Appellants were transferred to the office of Dy.
CAO in 1964.
The judgment of the High Court of Andhra Pradesh.
practically inter partes, affirms the position that appellants were transferred and their appointments by transfer were valid.
Their services were regularised and the High Court held regularisation valid and legal.
They were given seniority over respondents in that orgaoisation.
If appellants have been working for so many years, they were entitled to be absorbed, if there was no legal bar against absorption.
Their entry in office has been held by the Andhra Pradesh High Court in the earlier judgment as valid and regular and they having rendered service for 11 long years before the impugned action was , taken, they were entitled to be absorbed in he department.
Now the present dispute arose when by G. O. dated February 3, 1972, 38 posts in the cadre of UDC were made permanent.
That very G.O. provided that the posts made permanent shall be filled in by the personnel already working in the Accounts organisation.
Appellants were working in the Accounts organisation since 1964.
Their services were regularised.
They were given seniority.
Therefore, at the relevant time in 1975 they were working in Accounts organisation.
They could therefore, be absorbed without reference to Rule 3 (2).
The controversy arose because Dy.
CAO referred to Rule 3 (2) in the impugned order.
In our opinion that 416 was unnecessary.
They could claim to be absorbed according to senitority in the posts made permanent.
And therefore, also the impugned orders were valid but as the Dy.
CAO proceeded to exercise power under Rule 3 (2), we would uphold the validity for the reasons mentioned in the earlier portion of the judgment.
Before we conclude, we must advert to one contention, that as the appellants came at their own request, their seniority would be governed not by the first proviso to Rule 36 (e) but by the second proviso.
The relevant provisos to Rule 36 (e) cater to the method of determining seniority of persons transferred on administrative ground or at the request of Government servant from one department to any other department.
If the transfer was on administrative ground from one department or office to another, the seniority of the transferred Government servant shall be fixed with reference to the date of his first appointment in the former department or office from where he is transferred.
If on the other hand, the transfer is at the request of the concerned Government servant, his seniority will be determined with reference to the date of his appointment in the department to which he is transferred.
After referring to these provisos, it was urged that the appellants were transferred at their re quest and therefore, their seniority has to be determined with reference to the date on which they came to be transferred to the organisation of Dy.
In fact, this contention is concluded by the earlier decision of the Andhra Pradesh High Court.
Even apart from that there is no merit in the contention.
Appellants were transferred in February 1964 and we have referred to the transfer order more than once.
There is not the slightest whisper of transfer on request in that order.
But it was urged that initially transfer was for a period of one year only and the subsequent continuation in the office of the Dy.
CAO does not prescribe the period of transfer.
However, the respondents placed reliance on a corrigendum issued on March 3, 1964 by which following sentence was added to the order of transfer dated Feb. 8, 1964.
The addition reads as under: "The above transfers will be for a period of one year in the first instance.
" It was then pointed out that in the subsequent order the expression used is not 'period of transfer ' but 'period of deputation ' and an inquary was made whether the further extension of period was necessary.
This appears to us to be quibeling.
Except for appellant 9 R.V. Surya Rao, all the appellants have been working in the 417 Office of the Dy.
CAO since 1964 and it is too late in the day now to contend that the subsequent extension was at the request of the appellants Therefore, the seniority would be governed by the first proviso to Rule 36 (e) and not the second proviso and that having been done no question arises for interfering with the same.
As we are of the opinion that the Tribunal was in error in holding that the Dy.
CAO was not the Head of the Department, the decision of the Tribunal is unsustainable and must be quashed and set aside.
Accordingly this appeal is allowed, and the decision of the Andhra Pradesh Administrative Tribunal, Hyderabad in Transferred Writ Petition No. 1663176 dated September 1, 1980 is quashed and set aside and the Writ Petition field by the respondents in the Andhra Pradesh High Court is dismissed with no order as to costs.
S.R. Appeal allowed.
[/INST]The respondents were suspected of having committed an offence punishable with death or imprisonment for life under section 302 I.P.C. triable exclusively by the Court of Session.
They surrendered before the Magistrate on November 2, 1974 and were taken into custody.
The investigating officer failed to submit the charge sheet/police report against them within the period of 60 days contemplated by the proviso to sub section
(2) of section 167 of the Code of Criminal Procedure 1973 as it stood prior to its amendment in 1978.
However, the respondents did not apply to the Magistrate for being released on bail but approached the High Court under section 439 Cr.
According to the High Court, the charge sheet against the respondents was submitted on February 5 1975.
The High Court directed that the respondents be released on bail pending trial by the Court of Session holding: (i) that in a case triable exclusively by the Court of Session after the charge sheet has been submitted under section 170 and before committing the accused to the Court of Session the Magistrate has no jurisdiction to authorise the detention of an accused in custody under section 167 Cr.
P.C.; (ii) that in such a case section 209 would not confer power on the Magistrate to commit the accused to custody since after the enactment of the Code of Criminal Procedure, 1973, the procedure before the Magistrate under Chapter XVI of the Code would not be an inquiry within the meaning of section 2 (g) thereof; 538 (iii)that in such a case section 309 would also not enable the Magistrate to A remand the accused to custody since he would not be competent to try the accused; and (iv) that in view of the provision contained in section 207 read with section 209 Cr.
P.C. the Magistrate has to commit the accused forthwith to the Court of Session and it is only after the order of commitment is made that the Magistrate will have power to remand the accused to the custody during and until the conclusion of the trial.
Allowing the appeal, ^ HELD: The view that after the accused is brought before the court along with the police report under section 170 Cr.
P.C. the Magistrate must forth with commit the accused to the Court of Session because the Magistrate would have no jurisdiction in the absence of any provision to remand the accused to custody till the order committing the case to the Court of Session is made.
is wholly untenable and must be set aside.
[550 F H] Section 170 Cr.
P.C. Obligates the investigating officer to submit the police report, if in the course of investigation sufficient evidence or reasonable ground is made out for the trial or for commitment for trial of the accused, to the Magistrate empowered to take cognizance of the offence upon a police report.
On this report being submitted, the Magistrate takes cognizance of the offence disclosed in investigation as envisaged by S.190.
Cognizance of an offence even if exclusively triable by the Court of Session has to be taken by the Magistrate be cause section 193 precludes the Court of Session from taking cognizance of any offence.
Taking cognizance of an offence under section 190 is a purely judicial function subject to judicial review.
The statutory obligation imposed by section 207 read with section 209 on the Magistrate to furnish free of cost copies of documents mentioned in section 207 to the accused is a judicial function and it has to be discharged in a judicial manner.
It is distinctly possible that the copies may not be ready.
That makes it necessary to adjourn the matter for some time which may be spent in preparing the copies and supplying the same to the accused.
The Magistrate can proceed to commit the accused for trial to the Court of Session only after he judicially discharges the function imposed upon him by section 207.
This conclusion is fortified by the provisions contained in Ss. 226 and 227 of Chapter XVIII which prescribe the procedure for trial of a case by the Court of Session.
When the Magistrate is performing a judicial function under section 207, it would undoubtedly be an inquiry.
The making of an order committing the accused to the Court of Session will equally be a stage in the inquiry.
Thus from the time the accused appears or is produced before the Magistrate with the police report under section 170 and the Magistrate proceeds to enquire whether section 207 has been complied with and then proceeds to commit the accused to the Court of Session, the proceeding before the Magistrate would be an inquiry as contemplated by section 2(g), and section 309(2) would enable the Magistrate to remand the accused to custody till the inquiry to be made is complete.
[547 G H; 548 A B; 549 B H; 550A D] 539 In the instant case, when the matter was before the High Court, the charge sheet had not been submitted against the respondents by the investigating A officer meaning thereby that the investigation was still in progress.
If the High Court had no information when the application for bail moved by the respondents for being enlarged on bail was heard as to whether the charge sheet against the respondents had been submitted to the Magistrate or not, it was futile for the High Court to have undertaken an investigation of a point of law which did not directly arise in the facts before the High Court.
As the High Court had dealt with the matter, it became a precedent and, therefore, it became necessary for the Court to examine whether the view of the High Court was in consonance with the provisions of the Code.
[544 H; 545 A D] The High Court was right in holding that the jurisdiction to grant bail, in case investigation is not completed within the prescribed limit as incorporated in the proviso to section 167 (2) as it then stood, vests in the Magistrate if the accused applies for and is prepared to furnish bail.
Section 167 envisages a stage when a suspect is arrested and investigation is not complete within the prescribed period.
The investigation would come to an end the moment charge sheet is submitted as required under section 170 unless the Magistrate directs further investigation.
[545 E F] State of Bihar and Arn.
vs J.A.C. Saldanha and Ors. ; , referred to.
</s>
|
<s>[INST] Summarize the judgementAppeal No. 1222 of 1966.
Appeal from the judgment and order dated March 14 1966 Appeal of the Punjab High Court (Circuit Bench), at Delhi in Civil Writ No. 832 D of 1965.
section V. Gupte, Solicitor General, N. section Bindra, R. H. Dhebar and B. R. G. K. Achar, for the appellant.
M. C. Setalvad, B. C. Dutt, Santosh Chatterjee, B. Partha sarathy, 0.
C. Mathur, and Ravinder Narain, for respondent No. 1.
B. C. Dutt, Santosh Chatterjee, Anand Prakash, 0.
C. Mathur and Ravinder Narain, for respondent No. 2.
The Judgment of the Court was delivered by Subba Rao, C. J.
This appeal by certificate raises the question of the constitutional validity of the Metal Corporation of India ,(Acquisition of Undertaking) Act (No. XLIV of 1965), hereinafter called the Act.
The relevant facts lie in a small compass.
The 1st respondent, The Metal Corporation of India Limited, hereinafter called the ,Corporation, was a limited company constituted under the Indian Companies Act, having for its objects, inter alia, the development of zinc and lead mines at Zawar in the State of Rajasthan and the construction of a zinc smelter and other connected works for producing electrolytic zinc and by products.
The Government was ,satisfied that it was necessary to acquire the said Corporation in public interest and on October 22, 1965, the President of India 257 promulgated an Ordinance (No. 6 of 1965) providing for the acquisition of the Corporation by the Central Government.
Pursuant to the said Ordinance, on or about October 23, 1965, the Central Government took over the possession, control and administration of the said Corporation.
The Corporation, the 1st respondent and its Managing Director, the 2nd respondent filed a Writ Petition under article 226 of the Constitution in the High Court of Judicature for the State of Punjab, Circuit Bench at New Delhi, being Petition No. 631 D of 1965, challenging the validity of the said Ordinance.
In the meantime, the Parliament passed the Act on the same terms as contained in Ordinance No. 6 of 1965: it received the assent of the President of India on December 12, 1965.
The respondent filed another writ petition in the said High Court, being Writ Petition No. 832 D of 1965, for a declaration that the Act was ultra vires the Constitution.
The said High Court held that the Ordinance and the Act contravened the relevant provisions of article 31 of the Constitution and, therefore, were constitutionally void.
The present appeal is preferred against the said judgment of the High Court.
It will be convenient at this stage to read the relevant provisions of the Act.
The preamble and the relevant provisions of the Act read: "Preamble.
An Act to provide for the acquisition of the undertaking of the Metal Corporation of India Limited for the purpose of enabling the Central Government in the public interest to exploit, to the fullest extent possible, zinc and lead deposits in and around the Zawar area in the State of Rajasthan and to utilise those minerals in such manner as to subserve the common good Section 3.
On the commencement of this Act, the undertaking of the company shall, by virtue of this Act, be transferred to, and vest in, the Central Government.
Section 10.
(1) The Central Government shall pay compensation to the company for the acquisition of the undertaking of the company and such compensation shall be determined in accordance with the principles specified in the Schedule and in the manner hereinafter set out, that is to say, (2) Notwithstanding that separate valuations are calculated under the principles specified in the Schedule in respect of the several matters referred to therein, the 258 amount of compensation to be given shall be deemed to be a single compensation to be given for the undertaking as a whole.
(3) THE SCHEDULE Principles for determining compensation for acquisition of the undertaking.
Paragraph I. The compensation to be paid by the Central Government to the company in respect of the acquisition of the undertaking thereof shall be an amount equal to the sum total of the value of the properties and assets of the company on the date of commencement of this Act calculated in accordance with the provisions of paragraph II less the sum total of the liabilities and obligations of the company as on the said date calculated in accordance with the provisions of paragraph 111.
Paragraph II. (a) The market value of any land or buildings; (b) the actual cost incurred by the company in acquiring any plant, machinery or other equipment which has not been worked or used and is in good condition and the written down value (determined in accordance with the provisions of the Income tax Act, 1961 (XLIII of 1961), of any other plant, machinery or equipment; (c) the market value of any shares, securities or other investments held by the company; (d) the total amount of the premium paid by the company in respect of all leasehold properties reduced in the case of each such premium by an amount which bears to such premium the same proportion as the expired term of the lease in respect of which such premium shall have been paid bears to the total term of the lease; (e) the amount of debts due to the company, whether secured or unsecured, to the extent to which they are reasonably considered to be recoverable.
(f) the amount of cash held by the company, whether in deposit with a bank or otherwise; (g) the value of all tangible assets and properties other than those failing within any of the preceding clauses.
Paragraph III.
The total amount of liabilities and obligations incurred by the company in connection with 259 the formation, management and administration of the undertaking and subsisting immediately before the commencement of this Act.
" The gist of the said provisions may be given thus.
The Act was made to acquire in public interest the undertaking of the Corporation, On the commencement of the Act, the undertaking was transferred and vested in the Central Government.
Under section 10 of the Act, the Government shall pay compensation to the undertaking as a whole: but, in the absence of an agreement between the Government and the Corporation, the compensation payable to the Corporation has to be ascertained under the principles specified in the Schedule in respect of the several matters referred to therein.
Paragraph 1 of the Schedule lays down the manner in which the compensation to be paid to the Corporation for the acquisition of the undertaking is to be ascertained.
The said compensation shall be an amount equal to the sum total of the value of the properties and assets of the Corporation on the date of the commencement of the Act calculated in accordance with the provisions of paragraph It less the liabilities on the said date calculated in accordance with the provisions of paragraph III of the Schedule.
Broadly, the said paragraph lays down the principles for ascertaining the value of lands, buildings, machinery and equipment, amounts due to the undertaking and other tangible assets and properties.
The different clauses of the paragraph adopt different principles for valuation.
But what is important for the present purpose is the principle embodied in cl.
(b) of para II.
It is in two parts: the first provides for the valuation of plant, machinery or other equipment which has not been worked or used and is in good condition, and the second provides for the valuation of any other plant, machinery or equipment.
The former has to be valued at the actual cost incurred by the Corporation in acquiring the same and the latter at the writtendown value determined in accordance with the provisions of the Indian Income tax Act, 1961.
The High Court held, on a construction of the said provisions, that the principle contained in cl.
(b) of paragraph 11 of the Schedule to the Act in respect of machinery etc. "cannot be called relevant to the determination of 'just equivalent ', as it takes no notice of the notorious fact that prices have been steadily rising during the past several years, particularly of imported machinery and plant".
It also held, "that depreciation rule does not even pretend to determine the actual depreciation in a particular case and it is obvious that such depreciation has no real relationship with the actual value of any machinery at any particular point of time".
On that reasoning, it came to the conclusion, having regard to the decision of this Court in Vajravelu vs Special Deputy Collector(1) that the said provision in respect of machinery did.
(1) ; 260 not lay down a principle for fixing compensation i. e., a just equivalent to the machinery acquired.
The reasoning of the High Court was attacked by the learned Additional Solicitor General on the ground that it did not appreciate the true scope of the said decision of this Court and that, in any view, it went wrong in applying the principle of the said decision to the provisions of the Act.
He contended that the Act laid down the broad principle that compensation shall be paid for the entire undertaking as a unit, but provided different modes for the ascertainment of the value of different parts thereof in such a way that the deficiency in the valuation of one part was offset by the liberal valuation of the other part.
In that view, he contended, the Act embodied a principle relevant to the ascertainment of compensation for the undertaking acquired and, therefore, the product worked out under the said principle pertained only to the realm ,of adequacy which was beyond the ken of judicial review.
He added that compensation in article 31 of the Constitution meant that cornpensation which was regarded as just in the context of public acquisitions and that test was satisfied in the present case.
Mr. M. C. Setalvad, learned counsel for the respondents, contended that though under the Act compensation was to be given to the undertaking as one unit, the Act laid down principles for arriving at the valuation of the parts to arrive at the valuation of the whole and that, therefore, every such principle should stand the test laid down by this Court.
So judged, the argument proceeded, both the principles laid down in cl.
(b) of para 11 of the Schedule had no nexus to the ascertainment of compensation for the machinery acquired, for in the case of unused machinery, its cost price was the guide and in the case of used machinery its written down value was the criterion and that both the methods were arbitrary.
We find it difficult to appreciate the arguments of the learned Solicitor General.
It is true that under section 10 of the Act the Central ,Government shall pay compensation for the acquisition of the undertaking to the Corporation and the said compensation arrived at in the manner prescribed in the Schedule to the Act shall be ,deemed to be a single compensation to be given to the undertaking as a whole.
But it will be noticed that though a single compensation for the undertaking is given, the said compensation shall be deter mined in accordance with the principles specified in the Schedule.
Under the Schedule, the compensation for the entire undertaking shall be the amount equal to the sum total of the value of the properties and assets of the Corporation calculated in accordance with the provisions of para II of the Schedule.
Under the said para 11, different principles are laid down for ascertaining the value of different parts of the undertaking.
If all the said principles laid ,down in para 11 of the Schedule do not provide for the just equivalent 261 of all the parts of the undertaking mentioned therein, the sum total also cannot obviously be a just equivalent of the undertaking.
So too, if some of them do not provide for a just equivalent and others do so, the sum total cannot equally be a just equivalent to the undertaking.
In the case of the undertaking in question, the machinery is the most valuable part of the undertaking.
Apropos the unused machinery in good condition, how can the price for which the said machinery was purchased years ago possibly represent its price at the time of its acquisition? A simple illustration will disclose the irrelevance of the principle.
Suppose in 1950 a machinery was purchased for Rs. 100 and, for some reasons, the same has not been used in the working of the undertaking but has been maintained in good condition.
That machinery has not become obsolescent and still can be used effectively.
If purchased in open market it will cost the owner Rs. 1,000.
A compensation of Rs. 100 for that machinery cannot be said to be a just equivalent of it.
It is common knowledge that there has been an upward spiral in prices of the machinery in recent years.
The cost price of a machinery purchased about ten years ago is a consideration not relevant for fixing compensation for its acquisition in 1965.
The principle must be such as to enable the ascertainment of its price at or about the time of its acquisition.
Nor the doctrine of written down value accepted in the Income tax law can afford any guide for ascertaining the compensation for the used machinery acquired under the Act.
Under the general scheme of the Income tax Act, the income is to be charged regardless of the diminution in the value of the capital.
But the rigor of this hard principle is mitigated by the Act granting allowances in respect of depreciation in the value of certain assets such as machinery, buildings, plant, furniture etc.
These allowances are worked out on a notional basis for giving relief to the income tax assessee.
This artificial rule of depreciation evolved for income tax purposes has no relation to the value of the said assets.
To illustrate: a machinery was purchased in the year 1950 for Rs. 1,000.
The aggregate of all the depreciation allowances made year after year for ten years may exhaust the sum of Rs. 1,000 with the result, after the tenth year, the assessee will not be entitled to any depreciation.
From this it cannot be said that after the tenth year the machinery has no value.
Indeed, a machinery purchased for Rs, 1,000 in 1950, because of subsequent rise in.
prices may be sold in 1965 for Rs. 10,000.
But the application of the principle laid down in cl.
(b) of para 11 of the Schedule to the Act in regard to used machinery gives the owner no compensation at all.
Yet, the Government takes the machinery worth Rs. 10,000 gratis.
This illustration exposes the extreme arbitrariness of the principle.
It is, therefore, manifest that the two principles of valuation embodied in cl.
(b) of para II of the Schedule to the Act are not relevant to the fixing of compensation for the machinery at.
the time of its acquisition under the Act.
The argument, of the 262 learned Additional Solicitor General that the working out of all the principles in respect of different parts of the undertaking would result in a product which would fairly represent, in the context of public acquisitions, the "just equivalent" to the undertaking acquired is purely based on a surmise for, it is not shown that the working out of any one or more of the principles would give a higher compensation to some parts of the undertaking so that the excess paid under one head would offset the deficiency under another head.
Nor can the doctrine of inherent worth of a machinery has any relevance in the matter of giving compensation for its acquisition at a particular point of time, for the simple reason that the worth of an article depends upon the market conditions obtaining at the time of its acquisition.
It is impossible to predicate, irrespective of such conditions, that a particular machinery has a fixed value.
for all times.
Four decisions of this Court laid down the principles applicable to the present case.
Indeed, but for the said decisions, we would have posted this case before a Constitution Bench of five Judges.
But, as this appeal involves only the application of the construction put upon article 31 of the Constitution by this Court in the said decisions, we did not resort to that course.
The first of them is The State of West Bengal vs Mrs. Bela Banerjee (1).
There, the validity of the West Bengal Land Development and Planning Act, 1948 was under scrutiny.
Section 8 thereof provided that compensation to be awarded for compulsory acquisition to owners of land was not to exceed the market value as on December 31, 1946.
This Court held that the said Act was ultra vires the Constitution and void under article 32(2) thereof.
In that context, Patanjali Sastri, C.J., observed: "Turning now to the provisions relating to compensation under the impugned Act, it will be seen that the latter part of the proviso to section 8 limits the amount of compensation so as not to exceed the market value of the land on December 31, 1946, no matter when the land is acquired.
Considering that the impugned Act is a permanent enactment and lands may be acquired under it many years after it came into force, the fixing of the market value on December 31, 1946, as the ceiling on compensation, without reference.
to the value of the land at the time of the acquisition is arbitrary and cannot be regarded as due compliance in letter and spirit with the requirement of article 31(2).
" The above decision was followed by this Court in State of Madras vs D. Namasivaya Mudaliar(2).
There the respondents were owners of certain lands which were to be compulsorily acquired under (1) ; , 564.
(2) ; , 945 2 63 Madras Lignite (Acquisition of Land) Act, 1953.
The Act came into force on August 20, 1953, before article 31 of the Constitution was amended by the Constitution (Fourth Amendment) Act, 1955.
By the said Act compensation for the acquisition of lignite bearing bands under the Land Acquisition Act was to be assessed on the market value of the land prevailing on August 28, 1947, and not on he date on which the notification was issued under section 4(1) of the and Acquisition Act.
It also provided that in awarding compensation, the value of non agricultural improvements commenced since April 28, 1.947 would not be taken into consideration.
This Court held that the said Act was bad, because it contravened article 31(2) of the Constitution, as it stood before the Constitution (Fourth Amendment) Act, 1955.
This Court, speaking through Shah, J., observed: "Assuming that in appropriate cases, fixation of a date anterior to the publication of the notification under section 4(1) for ascertainment of market value of the land to be acquired, may not always be regarded as a violation of the constitutional guarantee, in the absence of evidence that compensation assessed on the basis of market value on such anterior date, awards to the expropriated owner a just monetary value of his property at the date on which his interest is extinguished, the provisions of the Act arbitrarily fixing compensation based on the market value at a date many years before the notification under section 4(1) was issued, cannot be regarded as valid." Then the learned Judge proceeded to state: "To deny to the owner of the land compensation at rates which justly indemnify him for his loss by awarding him compensation at rates prevailing ten years before the date on which the notification under section 4(1) was issued amounts in the circumstances to a flagrant infringement of the fundamental right of the owner of the land under article 31(2) as it stood when the Act was enacted.
" These two decisions turned upon the construction of article 31(2) of the Constitution before the Constitution (Fourth Amendment) Act, 1955.
These cases laid down two propositions: (1) "Compensation" under article 31(2) of the Constitution means a "just equivalent" of what the owner has been deprived of ; and (2) the value of land at an anterior date is presumed to be no compensation within the meaning of the said Article.
After the Constitution (Fourth Amendment) Act, 1955, this Court had to construe in two decisions he amended provision of article 31(2) vis a vis the expression "compensation" found therein.
The first decision is that in Vajravelu 264 vs Special Deputy Collector(1).
There, this Court observed at p. 625 626: "A scrutiny of the amended Article discloses that it accepted the meaning of the expressions "compensation" and "principles" as defined by this Court in Mrs. Bela Banerjee 's case(2)." .lm0
And it held that, if the compensation is illusory or if the principles prescribed are irrelevant to the value of the property at or about the time of its acquisition, it can be said that the Legislature committed a fraud on power and, therefore, the law is bad.
One of the illustrations given at p. 627 is relevant to the present enquiry and that is as follows : if a law lays down principles which are not relevant ' to the property acquired or to the value of the property at or about the time it is acquired, it may be said that they are not principles contemplated by article 31(2) of the Constitution.
If a law says. . that though it (house) is acquired in 1960 its value in 1930 should be given. . the principles do not pertain to the domain of adequacy but are principles unconnected to the value of the property acquired.
" Applying these principles, this Court in Jeejeebhoy vs Assistant Collector(3), held that the fixation of an anterior date for the ascertainment of the value of the property acquired without reference to any relevant considerations which necessitated the fixing of an earlier date for the purpose of ascertaining the real value is arbitrary.
On that ground this Court held that the Land Acquisition (Bombay Amendment) Act, 1948, did not provide for payment of just equivalent of what the owner was deprived of, as it provided for the ascertainment of compensation on the basis of the value of lands acquired as on January 1, 1948 and not as on the date on which the section 4 notification under the 1894 Act was issued.
The relevant aspect of the legal position evolved by the said decisions may be stated thus: Under article 31(2) of the Constitution, no property shall be compulsorily acquired except under a law which provides for compensation for the property acquired and either fixes the amount of compensation or specifies the principles on which and the manner in which compensation is to be determined and given.
The second limb of the provision says that no such law shall be called in question in any court on the ground that the compensation provided by the law is not adequate.
If the two concepts, namely, "compensation" and the jurisdiction of the court are kept apart, the meaning of the provisions is clear.
The law to (1)[1965] 1 S.C.R. 614.
(2) ; (3) 6. 265 justify itself has to provide for the payment of a "just equivalent" to the land acquired or lay down principles which will lead to that result.
If the principles laid down are relevant to the fixation of compensation and are not arbitrary, the adequacy of the resultant product cannot be questioned in a court of law.
The validity of the principles, judged by the above tests, falls within judicial scrutiny, and if they stand the tests, the adequacy of the product falls outside its jurisdiction.
Judged by the said tests, it is manifest that the two principles laid down in cl.
(b) of Para 11 of the Schedule to the Act, namely, (i) compensation equated to the cost price in the case of unused machinery in good condition, and (ii) written down value as understood in the Income tax law as the value of used machinery, are irrelevant to the fixation of the value of the said machinery as on the date of acquisition.
It follows that the impugned Act has not provided for "compensation" within the meaning of article 31(2) of the Constitution and, therefore, it is void.
The mere fact that in regard to some parts of the undertakings the principles provide for compensation does not affect the real question, for, machinery is the major part of the undertaking and,, as the entire undertaking is acquired as a unit, the constitutional invalidity of cl.
(b) of Para 11 of the Schedule to the Act affects the totality of the compensation payable to the entire undertaking.
In the context of compensation for the entire undertaking, the clauses of Para 11 of the Schedule to the Act are not severable.
In the result, the Act, not having provided for compensation, is unconstitutional and the conclusion arrived at by the High Court is, correct.
appeal fails and is dismissed with costs.
V.P.S. Appeal dismissed.
[/INST]The fundamental idea underlying the words used in the definition of "business" in section 2(4) of the Income tax Act the continuous exercise of an activity and the same central idea is implicit in the words "carried on by him" occurring in 10(1) and those critical words are an essential constituent that which is to be produce the taxable income, and therefore the 768 tax is payable only in respect of the profits or gains of the business which is carried on by the assessee.
That under clause (vii) of section 10(2) the machinery and plant must be such as were used at least for a part of the accounting year.
As the machinery and plant of the sugar factory which were sold had not at all been used for the purpose of business during the accounting year, the second proviso to s.10.
(2) (vii) could have no application and the assessees were not liable.
Although the High Court will not disturb or go behind a finding of fact of the Tribunal, it is well settled that where it is competent for a Tribunal to make findings of fact which are excluded from review, the appeal court has always jurisdiction to intervene if it appears either that the Tribunal has misunderstood the statutory language because the proper construction of the statutory language is a matter of law or that the Tribunal has made a finding for which there is no evidence or which is inconsistent with the evidence and contradictory of it.
Commissioner of Income tax vs Shaw Wallace and Company (L.R. 59 I.A. 206), and Commissioners o/Inland Revenue vs Fraser (24 Tax Cases 498) referred to.
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<s>[INST] Summarize the judgementAppeal No. 2860(NT) of 1979.
From the Judgment and Order dated 8.3.1979 of the, Patna High Court in Civil writ jurisdiction case No.2909 of 1978.
V.A. Babde, R.F. Nariman and Ms. Kamakshi (For Gagrat & Co.) for the appellant.
Dr. section Narayan P. Parmeshwaran and Manoj Prasad for the Respondents.
The Judgment of the Court was delivered by, VENKATACHALA, J.
The short, question which needs our decision in this appeal by special leave is whether a person who credits to the account of or pays to a contractor any sum payable by any of the organisations specified in section 194C(1) of Income Tax Act, 1961 'the Act ' for carrying out any work including supply of labour for carrying out any work) in pursuance of a contract between the contractor and the specified organisation is liable to deduct two per cent of such sum as income tax as required under that sub section.
The facts 'which, have lad to the need for our decision on the said question are briefly these.
The Associated Cement Company Ltd. the appellant, issued a letter dated 5th November, 1973 to Mr.
S.P Nag contractor Jhiakpani Containing the terms and conditions of a contract of leading packed cement bags,from its Packing Plants.
Nos.1 & 2 into wagons or trucks.
Under clause.
12 of those terms and conditions, there 541 was a stipulation that the contractor shall be paid a sum for his work at a flat rate of 41 paise for such tonne of cement handled in Packing Plant No.1.
and 30 paise for each, tonne o f cement handled in Packing Plant No.2.
Clause 13 thereof, which contained a recital that the rate of loading in clause 12 had been worked out on the basis of daily basic wages of Rs.2.35 paise, D.A. of Rs. 1.21 paise and H.R.A. of Rs.0.50 paise, per day per worker stipulated a term of reimbursement by the appellant to the contract of the difference in D.A. over the amount of Rs.1.21 paise and annual increment etc.
payable from month to month to every worker by him as per the Second Wage Board Recommendation.
As the contractor carried out his work according to the terms and conditions in the contract during the years 1973 74 and 1974 75, the appellant made payments of the sums payable to him under clause 12 of the contract and the sums reimbursable to him under clause 13 thereof But the deductions made 'under section 194C(1) of the Act by the appellant out of the sums paid or reimbursed to the contractor fell short of the deductions required to be made thereunder.
As the appellant took the stand that it was not liable to deduct any amount under section 194(1), out of the sums paid on its behalf to the contractor as per clauses 12 & 13 of the contract, the Income Tax Officer, Jamshedpur, served on the principal officer of the appellant a notice dated 30th March, 1978 to show cause as to why action should not be taken against the appellant under sections 276B(1), 281 and 221 of the Act in respect of assessment years 1973 74 and 1974 75 for short deductions out of the sums paid to contractor without observing the requirement of section 194C(1) of the Act.
Another notice dated 8th May, 1978.relating to the assessment years 1974 75 to 1977 78 of a similar nature, was also served on the principal officer of the appellant.
The appellant, although impugned both the said notices in a Writ Petition filed under Articles 226 and 227 of the Constitution before the High Court of Judicature at Patna, that Writ Petition was dismissed by the High Court by its order dated 8th March, 1979.
The appellant has, therefore, filed this appeal by special leave before this Court seeking the quashing of the notices which it had unsuccessfully impugned before the High Court, in its Writ Petition.
It was argued by Mr. V.A. Bobde, the learned senior counsel appearing for the appellant, that the amount deductible under section 194C(1) out of the sums credited to the account of or paid to a contractor would arise only when such sums are paid, on account of a contractor executing a works contract, that is, a contract which produces a tangible property.
542 According to him, the 'work ' for the the carrying of which the sum is required to be credited to the account of or paid to a contractor under section 194C(1) of the Act is only a 'works contract ' and hence deduction under that sub section could arise only to the extent where the sum credited to the account of or paid to a contractor for executing such 'works contract ' is comprised of the element of income (profit) of the contractor, as held by this Court in Brij Bhushan Lal Parduman Kumar etc.
vs Commissioner of Income Tax Haryana, Himachal Pradesh and New Delhi III, [1979] 2 SCR 16 and not otherwise.
It was also his argument that the words in the sub section 'on income comprised therein ', appearing immediately after the words 'deduct an amount equal to two per cent of such sum as income tax ' found in the concluding part of that sub section, must be taken to mean the percentage amount deductible on the income received by the contractor under the contract and not on the sum credited to the account of or paid to the contractor in pursuance of the contract.
These arguments were, however, strongly refuted by Dr. section Narayan, the learned counsel for the Revenue.
It is how, the question mentioned at the outset needs our decision.
Section 194C(1) of the Income Tax Act on the proper construction of which the decision on the aforesaid question should necessarily rest, runs thus: '194C(1).
Any person responsible for paying any sum to any resident (hereafter in this section referred to as the contractor) for carrying out any work (including supply of labour for carrying out any work) in pursuance of a contract between the contractor and (a) the Central Government or any State Government; or (b) any local authority; or (c) any corporation established by or under a Central, State or Provincial Act; or (d) any company , or (e) any co operative society , or (f) any authority, constituted in India by or under any law, 543 engaged either for the purpose of dealing with and satisfying the need for housing accommodation or for the purpose of planning, development or improvement of cities, towns and villages, or for both; or (g) any society registered under the (21 of 1860) or under any law corresponding to that Act in force in any part of India; or (h) any trust; or (i) any University established or incorporated by or under a Central, State or Provincial Act and an institution declared to be a University under section 3 of the (3 of 1956 , shall, at the time of credit of such sum to the account of the contractor or at the time of payment thereof in cash or by issue of a cheque or draft or by any other mode, whichever is earlier, deduct an amount equal to two per cent of such sum as income tax on income comprised therein.
" No ambiguity is found in the language employed in the subsection.
What is contained in the sub section, as appears from its plain reading and analysis admit of the following formulations: (1) A contract may be entered into between the contractor and any of the organisations specified in the sub section.
(2) Contract in Formulation 1 could not only be for carrying out any work but also for supply of labour for carrying out any work.
(3) Any person responsible for paying any sum to a contractor in pursuance of the contract in Formulations 1 and 2, could credit that sum to his account or make its payment to him in any other manner.
(4) But, when the person referred to in Formulation 3 either credits the sum referred to therein to the account 544 of or pays it to the contractor, he shall deduct out of that sum an amount equal to two per cent as income tax on income comprised therein.
Thus, when the percentage amount required to be deducted under the sub section as income tax is on the sum credited to the account of or paid to a contractor in pursuance of a contract for carrying out a work or supplying labour for carrying out a work, of any of the organisations specified therein, there is nothing in the sub section which could make us hold that the contract to carry out a work or the contract to supply labour to carry out a work should be confined to 'works contract ' as was argued on behalf of the appellant.
We see no reason to curtail or to cut down the meaning of plain words used in the Section.
"Any work" means any work and not a 'works contract", which has a special connotation in the tax law.
Indeed, in the sub section, the 'work ' referred to therein expressly includes supply of labour to carry out a work.
It is a clear indication of legislature that the 'work ' in sub section is not intended to be confined to or restricted to 'works contract '. 'Work ' envisaged in the sub section, therefore, has wide import and covers 'any work ' which one or the other of the organisations specified in the sub section can get carried out through a contractor under a contract and further it includes obtaining by any of such organisations supply of labour under a contract with a contractor for carrying out its work which, would have fallen outside the 'work ', but for its specific inclusion in the sub section.
In Brij Bhushan (supra) this Court was concerned with the question whether the cost of materials supplied by the Government for being used in execution of works is liable to be taken into consideration while estimating the income or profits of a contractor.
That question was answered by this Court, thus: "It is true that ordinarily when a works contract is put through or completed by a contractor the income or profits derived by the contractor from such contract is determined on the value of the contract as a whole and cannot be determined by considering several items that go to form such value of the contract but in our view where certain stores/material is supplied at fixed rates by the Department to the Contractor solely for being used or 545 fixed or incorporated in the works undertaken on terms and conditions mentioned above, the real total value of the entire contract would be the value minus the cost of such stores/material so supplied.
Therefore, since no element of profit was involved in the turnover represented by the cost of stores/material supplied by the M.E.S. to the assessee firms, the income or profits derived by the assessee firms from such contracts will have to be determined on the basis of the value of the contracts represented by the cash payments received by the assessee firms from the M.E.S. Department exclusive to the cost of the material '/stores received for being used, fixed or incorporated in the works undertaken by them.
" The above decision cannot be of any help to the appellant for it does not lay down that the percentage amount deductible under section 194C(1) should be out of the income of the contractor from the sum or sums credited to the account of or paid to him.
The words in the sub section 'on income comprised therein ' appearing immediately after the words deduct an amount equal to two per cent of such sum as income tax ' from their purport, cannot be understood as the percentage amount deductible from the income of the contractor out of the sum credited to his account or paid to him in pursuance of the contract.
Moreover, the concluding part of the sub section requiring deduction of an amount equal to two per cent of such sum as income tax, by use of the words 'on income comprised therein ' makes it obvious that the amount equal to two per cent of the sum required to be deducted is a deduction at source.
Indeed, it is neither possible nor permissible to the payer to determine what part of the amount paid by him to the contractor constitutes the income of the latter.
It is not also possible to think that the Parliamer ' could have intended to cast such impossible burden upon the payer nor could it be attributed with the intention of enacting such an impractical and unworkable provision.
Hence, on the express language employed in the sub section, it is impossible to hold that the amount of two per cent required to be deducted by the payer out of the sum credited to the account of or paid to the contractor has to be confined to his income component, out of that sum.
There is also nothing in the language of the sub section which permits exclusion of an amount paid on behalf of the Organisation to the contractor according to clause 13 of the terms and conditions of the contract in reimbursement of the amount 546 paid by him to workers, from the sum envisaged therein, as was suggested on behalf of the appellant.
For the foregoing reasons, our decision on the question under consideration, is held in the affirmative and in favour of the Revenue.
In the result, this appeal fails and is dismissed directing the appellant to pay the costs of the respondent the Revenue in this appeal.
Advocate 's fee is fixed at Rs 3000.
T.N.A. Appeal dismissed.
[/INST]The appellant Company issued a letter to its Contractor containing the terms and conditions of a contract of loading packed cement bags from its Packing Plants Into wagons or trucks.
Under Clause 12 there was a stipulation that the Contractor shall be paid a sum for his work at a flat rate of 41 paise for each tonne of cement handled In Packing Plant No.1 and 30 paise for each tonne of cement handled in Packing Plant No.2 Clause 13 thereof, which contained a recital that the rate of loading in Clause 12 had been worked out on the basis of daily basic wages of Rs.2.35 paise, DA of Rs.1.21 paise and H.R.A of Rs.0.50 paise per day per worker, stipulated a terms of reimbursement by the appellant to the Contractor of the difference in DA over the amount of Rs.1.21 paise and annual increment etc.
payable from mouth to month to every worker by him.
The Contractor carried out his work and the appellant made payments of the sums payable to him under the contract.
But no deductions of tax were made under Section 194C(1) of the Income Tax Act, 1961.
The Income Tax Officer served two notices One in respect of assessment years 1973 74 and 1974 75 and the other for 1974 75 to 1977 78 on the principal officer of the appellant Company to show cause as to why action should not be taken against the appellant for non compliance with Section 194C(1).The appellant filed a Writ Petition before the High Court of Patna seeking the quashing of the notices but the same was dismissed.
In appeal to this Court it was contended on behalf of the appellant 538 539 that (1) the 'work ' for the carrying of which the sum is required to be credited to the account of or paid to a Contractor under Section 194C(1) of, the Act ' is only a 'works contract ' and hence deduction "under that sub section could arise only to the extent where the sum credited to the account of or paid to a Contractor for, executing such works contract ' is comprised of the element of Income of the Contractor, (2) that the words 'on income.
comprised therein ',appearing immediately after the words ' deduct an amount equal to two per cent of such sum as income tax in the concluding part of the sub section must be taken to mean the percentage amount deductible on the Income received by the Contractor under the contract and not on the sum credited 'to the account of 'or paid to the Contractor.
Dismissing the appeal, this Court, HELD. 1.
Them is nothing fit sub section (1) of Section 194C to show that the contract to carry out a work or the contract to supply labour to carry out a work should be confined to 'works contract '.There is no mason to curtail or to cut down the meaning of plain words used in the Section.
.Any work ' means any work and not &."works contract ', which has a special connotation in the tax law. 'Work ' envisaged In the sub section, therefore has.
a wide import and covers 'any work ' which one or the other of the organisations specified in the sub section can get carried out through a Contractor under a contract and further It includes obtaining by any of such organisations supply of labour under a contract with a Contractor for carrying out its work which, would have fallen outside the 'work ', but forks specific inclusion in the sub section.
[544 B E] Brij Bhushan Lal Parduman Kumar etc.
vs C.I. T., Haryana, Himachal Pradesh and New Delhi [1979] 2 S.C.R. 16, distinguished.
The words in the sub section 'on income comprised therein ' appearing Immediately after the words 'deduct an amount equal to two per cent of such sum as income tax ' from their purport, cannot be understood as the percentage amount deductible from the income of the Contractor out of the sum credited to his account or paid to him in pursuance of the co Moreover the concluding part of the sub section requiring deduction of an amount equal to two per cent of such sum as income tax by, use of the words 'on income comprised therein ' makes It obvious that the amount equal to two per cent of the sum required to be deducted Is a 540 deducts at source.
Hence on the express language employed in the sub section, it, is impossible to hold that the amount of the two per cent required to be deducted by the prayer out of the sum credited to the account of or paid to the Contractor has to be confined to his income component out of that sum, [545 D G] 2.1.
There is also nothing in the language of the sub section which permits exclusion of, an amount paid on behalf of the organisaiton to the Contractor according to, the termsand conditions ofthe contract in reimbursement, of.
the amount paidby to workers,from, the sum envisaged therein.
[545 G H, 546 A]
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<s>[INST] Summarize the judgement: Criminal Appeal No. 20 of 1975.
Appeal by Special Leave from the Judgment and order dated 15/16 11 1973 of the Gujarat High Court in Crl.
A. No. 22/73.
J. L. Nain, M. N. Shroff for the Appellants.
H. section Marwah, Amicus Curiae for the Respondents.
The Judgment of the Court was delivered by SARKARIA, J.
This appeal by special leave is directed against a judgment, dated November 15/16, 1973, of the High Court of Gujarat.
The material facts are as under: On June 23, 1973, a Police Sub Inspector made a report to the District Superintendent of Police, Rajkot, to the effect that the premises known as Rajkot Yuvak Sahakar Mandal situated at Mochhi 393 Bazar Road, near Krishna Cinema, Rajkot was used as a common gaming house and gambling was going on therein.
The Deputy Superintendent of Police, after making an inquiry, was satisfied about the contents of the report and he issued a warrant under Section 6 of the Bombay Prevention of Gambling Act (hereinafter referred to as the Act) and sent it to the Police Sub Inspector, Rajkot, for execution in accordance with law.
The Sub Inspector then reached the aforesaid B: premises in the early hours of June 24, 1973 at 4 a.m.
He found 10 persons, including the respondent herein, in the premises.
They had all gathered there for the purpose of gambling, and gambling was actually going on by play of cards, and tokens of various designs, which were used to indicate the different points, were also found there.
All the ten persons were arrested in respect of offences under Sections 4 and S of the Act.
The instruments of gaming were also seized.
On the following morning at 7 a.m., the petitioner and his companions submitted an application to the Police Sub Inspector, who was the first respondent before the High Court, requesting him to enlarge them on bail.
The Sub Inspector did not consider their bail applications, nor did he pass any order thereon.
At about noon, however, the respondents were produced before the Magistrate, who released them on bail.
The Sub Inspector did not consider their bail applications and release them on bail because he was prohibited from doing so by a Circular order issued by Shri P. H. Jethwa, District Superintendent of Police, Rajkot, directing all the Police Sub Inspectors not to release persons arrested in respect of offences under Sections 4 and S of the Act on bail, because in the Form of the warrant prescribed under Section 6 of the Act, it is mentioned that the arrested persons should be produced before the Magistrate.
The Circular order further directed that the arrested persons under the Act should be produced before the Magistrate.
The Circular further warned that if any Police officer violated these directions, he would expose himself to disciplinary action.
This Circular order (exhibit B) was impugned by a writ petition under Article 226 of the Constitution before the High Court.
Two main contentions were raised before the High Court.
First, that offences under Sections 4 and S of the Act are cognizable and bailable.
Consequently, under Section 496 of the Code of Criminal Procedure, 1898, the Police officer arresting the respondents was duty.
bound to enlarge them on bail.
The impugned Circular, being contrary to the statutory provisions, is illegal and ultra vires.
Second, the impugned Circular is violative of Article 14 of the Constitution, inasmuch as it discriminates between persons similarly situated.
The second ground was not pressed before the High Court 394 The first contention prevailed with the High Court.
In conclusion, it held that the Police officer had the power o} the authority to enlarge the arrested persons on bail.
Its reason was as under: "When the legislature empowers an officer to delegate any authority to do certain acts to another it necessarily implies that , the original authority can do such acts itself.
Consequently, when the Commissioner of Police and certain other officers mentioned in Section 6 are authorised to issue special warrant for search of the premises where gambling is going on, for the seizure of the articles therein or take into custody and bring before the court such persons who may be found therein, such officers can themselves do such acts.
" Referring to Section 4(1) (f) of the Code of Criminal Procedure the High Court observed that the words "a police officer" in that provision which defines a cognizable offence, do not mean "each and every" police officer.
It is sufficient if the power to arrest without warrant is limited by the provisions of law to a class of police officers and the offences in such cases fall within the purview of clause (f) of sub section (1) of Section 4 of the Code.
Since under Section 6 of the Act, the Police Commissioner and certain other officers, mentioned therein, have the power and authority to arrest persons accused of having committed the offences under Sections 4 and S of the Act with out warrant the said offences are cognizable.
Support for this reasoning was sought from a decision of this Court in Union of India vs I.C. Lala, etc.
The High Court further held that the provisions of Section 6 merely provide a limited exemption from the provisions of the Code of Criminal Procedure, in so far as they limit the class of Police officers who are competent to investigate the offences and to arrest without a warrant.
The mere fact that certain restrictions are placed as to the Police officers who are competent to investigate the offence would not make the offence any the less than cognizable.
It, also, referred to several decisions of the Bombay High Court, including the one Emperor vs Raghunath decided by a division Bench consisting of Beaumont, C.J. and Broom field, J., wherein it was held that an offence under Section 4 of the Act is non cognizable.
The High Court did not follow this decision because, in its view, it had ignored an earlier decision which covered the point which the court had decided, and the earlier decision was contrary to it.
With this reasoning, the High Court came to the conclusion that offences under Sections 4 and 5, being cognizable and 395 bailable, the commissioner of Police and the officers to whom a warrant can be granted for the purpose of investigation under the Act, have to release accused on bail under the provisions of Section 496 of the Code of Criminal Procedure.
They derive their power to grant bail from the statute.
The impugned order therefore, cannot be sustained because it runs counter to the statutory provisions which authorise the police officers mentioned in Section 6 to grant bail.
Nobody has appeared on behalf of the respondent, despite notice, to oppose this appeal.
Shri H. section Marwah, however, has been kind enough to assist the Court as amicus Curiae on behalf of the respondents.
Since the case was decided by the High Court on the basis of the first contention in favour of the respondent, herein, and the High Court did not go into the constitutional validity of the impugned order, we will confine the discussion to the first point, on the basis of which, the High Court has invalidated the impugned order.
We will assume for our purpose that Section 6 of the Act does not offend Article 14 of the Constitution.
Section 6 runs as under: "6(1).
It shall be lawful for a Police officer (i) in any area for which a Commissioner of Police has been appointed not below the rank of a Sub Inspector and either empowered by a general order in writing or authorised in each case by special warrant issued by the Commissioner of Police, and (ii) elsewhere not below the rank of Sub Inspector of Police authorised by special warrant issued in each case by a District Magistrate or Sub Divisional Magistrate or by a Taluka Magistrate specially empowered by the State Government in this behalf or by a District Additional, Assistant or Deputy Superintendent of Police, and (iii) without prejudice to the provision in clause (ii) above, in such other area as the State Government may, by notification in the official Gazette specify in this behalf, not below the rank of a Sub Inspector and empowered by general order in writing issued by the district Magistrate.
(a) to enter, with the assistance of such persons as may be found necessary, by night or by day, and by force, if necessary, any house, room or place which he has reason to suspect is used as a common gaming house: H (b) to search all parts of the house, room or place which he shall have so entered, when he shall have reason 396 to suspect that any instruments of gaming are concealed therein, and also the persons whom he shall find therein whether such persons are then actually gaming or not, (c) to.
take into custody and bring before a Magistrate all such persons; (d) to seize all things which are reasonably suspected to have been used or intended to be used for the purpose of gaming, and which are found therein: Provided that no officer shall be authorised by special warrant unless the Commissioner of Police, the Magistrate, the District or Additional or Assistant or Deputy Superintendent of Police concerned is satisfied, upon making such inquiry as he may think necessary, that there are good grounds to suspect the said house, room or place to be used as a common gaming house.
" From a plain reading of Section 6(1), it is clear that subject to the conditions of 'the proviso, a Commissioner of Police may empower by a general order or authorise by special warrant a police officer not below the rank of a sub Inspector, to do any of the acts and things enumerated in sub clauses (a) to (d) of that sub section, including the act of arresting a person found gambling or present in a common gaming house.
It follows therefrom, by necessary implication, that the Commissioner of Police can personally do any of the aforesaid acts and things which he could authorise any other police officer of the requisite rank to do.
The primary repository of the plenary power to do he aforesaid acts and things, constituted under sub clause (i), is the Commissioner of Police.
The sub clause only enables him to employ his subordinate police officer(s), not below the authorised rank of a Sub Inspector to execute his general order or special warrant to arrest for offences under Sections 4 and 5 of the Act.
It will be noted further that even under sub clause (iii), in an area notified by the Government.
any police officer not below the rank of a Sub Inspector empowered by the District Magistrate under a general order in writing can arrest a person found gambling or present in a common gaming house, without a warrant from a Magistrate.
In short, Section 6 confers the power of arrest thereunder only on a specified class of police officers and not on any or every police officer.
It is in the light of the above analysis of Section 6(1) that we have to determine whether the offences under Sections 4 and 5 of the Act are recognizable offences '.
Section 4(1)(f) of that Code of Criminal Procedure, 1898, defines "cognizable offence" to mean an offence for, and 'cognizable case ' to mean a case "in which a police officer, within 397 or without the Presidency towns may, in accordance with the Second Schedule or under other law for the time being in force, arrest without warrant".
There was a divergence of judicial opinion in regard to the connotation of the words "a police officer" used in the above definition.
One line of decisions, led by Deodhar Singh case, took the view that 1 these words in Section 4(1) do not necessarily mean "any and every" police officer.
It is sufficient to bring an offence within the definition of a 'cognizable offence ' if the power to arrest without a warrant is vested under the law in a police officer of a particular class only.
The ratio of Deodhar Singh 's case was followed by the Bombay High Court in Emperor vs Ismail and Emperor vs Abasbhai Abdul Hussain by the Nagpur Court in Nagarmal Jankiram, and by the Delhi High Court in Delhi Administration vs Parkash Chand & Ors.
A contrary view was taken by the Assam High Court in G. K. Apu vs Union of India; by the Allahabad High Court in State of U.P. vs Lal Bahadur & Ors.; by the Madhya Bharat High Court in Union of India vs Mahesh Chandra; and in some other decisions.
This conflict appears to have been set at rest by the decision of this Court in 1.
C. Lala 's case (ibid) which has expressly overruled the view taken by the Assam and Madhya Bharat High Courts.
We will notice Lala 's case, later.
It will suffice to say here that the view which has received the imprimatur of this Court, is that the expression "police officer" in Section 4(1)(f) of the Code does not necessarily mean "any and every" police officer, and an offence will still be a "cognizable offence" within this definition even if the power to arrest without warrant, for that offence is given by the statute to police officers of a particular rank or class.
In Queen Empress vs Deodhar Singh, under the Bengal Public Gaming Act II of 1867, the District Superintendent of Police (or the District Magistrate) was competent to arrest or by warrant to direct the arrest of persons found in a common gaming house.
The Question 398 was whether the offence under Section 4(1)(f) of the Bengal Act was cognizable.
This question turned on an interpretation of the expression "police officer" in the definition of 'cognizable offence ', and was answered in the affirmative, thus.: "Now, under the Gambling Act, it is not every Police officer who can arrest without a warrant.
It is only the District Superintendent of Police who can arrest or by warrant direct the arrest of persons gambling in a house.
The district Superintendent being a Police officer who may, under a law for the time being in force, viz., the Gambling Act, arrest without warrant.
We think that the requirements of clause (1) (f) of the above Sections are satisfied, and that the offence in question is, therefore, a 'cognizable offence '.
We cannot accept the contention that the words in that clause, 'a Police officer ' mean 'any and every ' Police officer.
It is sufficient if the Legislature has limited the power of arrest to any particular class of Police officers.
" If we may say so with respect, this is a correct exposition of the law on the point.
The ratio of Deodhar Singh 's case was followed by a Division Bench of the Bombay High Court (Marten and Madgavkar, JJ.) in Emperor vs Abasbhai Abdul Hussain (ibid).
The impugned judgment before us is also based on this decision.
These very provisions of the Bombay Prevention of Gambling Act came up for interpretation in re.
Naganmal Jankiram (ibid), and the same view was taken by Pollock J.
In Abasbhai 's case (ibid), a Sub Inspector got a warrant issued under Section 6 of the Bombay Prevention of Gambling Act, which authorised him to search certain premises.
In execution of that warrant the Sub Inspector raided a house and arrested three persons who were found therein.
The case was tried by the Magistrate concerned as a cognizable one.
At the trial at the stage of arguments, it was contended on behalf of the accused that offences under Sections 4 and 5 were non cognizable, and since the procedure of warrant case had been followed by the Magistrate, the trial was illegal.
The trial court accepted the argument and acquitted the accused.
In appeal before the High Court, it was agitated that the offence was a cognizable one.
The High Court reasoned and we think rightly that since under Section 6 of the Act the Commissioner of Police has power to issue special warrants of search and also to arrest, he is competent to do personally, what he may authorise others to do by special warrant.
It followed the dictum of Deodhar Singh 's case in regard to the interpretation of the words "a police officer" in the definition of "cognizable offence" given in the Code of Criminal Procedure.
On 399 these premises, the High Court held that offence s under Sections 4 and 5 are cognizable.
In Emperor vs Ismail (ibid), a Division Bench of the Bombay High Court, reaffirmed the dictum of Abasbhai 's case, that an offence punishable under Section 4 of the Act, is cognizable.
In Delhi Administration vs Parkash Chand & Ors., H. R. Khanna, J., following the dictum of the Calcutta High Court in Deodhar Singh 's case, and of Bombay High Court in Abasbhai 's case, held that offences under Sections 3 and 4 of Delhi Gambling Act are 'cognizable offences ' as Section S of the Delhi Act gives the Superintendent of Police power to arrest or authorise any officer of police, not below the rank of Sub Inspector, to arrest without a warrant.
It is argued on behalf of the appellant State that the ratio of the aforesaid decisions in Deodhar Singh 's case and Parkash Chand 's case is not applicable to offences under the Bombay Prevention of Gambling Act, because the Bengal Act and the Delhi Act expressly empower the Superintendent of Police either to arrest himself or direct arrest by another police officer of requisite rank, whereas in Section 6(1) of the Bombay Prevention of Gambling Act there are no express words giving an option, to the Commissioner of Police to effect arrest, personally.
We are unable to accept this argument.
The difference pointed out, is a distinction without a difference.
What was explicit in the Bengal Gambling Act and the Delhi Gambling Act, is implicit in Section 6(1) of the Bombay Prevention of Gambling Act.
It will now be appropriate to notice this Court 's decision in Union of India vs I. C. Lala.
In that case, two army officers and one business man were charged with the conspiracy of the offences punishable under Sections 120B and 420 of the Indian Penal Code, read with Section S(2) of the Prevention of Corruption Act.
The officer who investigated these offences was an Inspector of the Delhi Police Establishment.
Under Section SA of the Prevention of Corruption Act, before its amendment in 1974, no officer below the rank of Deputy Superintendent of Police could investigate an offence punishable under Sections 161, 165 and 165A of the Indian Penal Code and under Section 5(2) of the Prevention of Corruption Act, without the order of the Presidency Magistrate or a Magistrate of the First Class.
The question before the Court was.
whether sanction under Section 196A of the Code was necessary.
The answer to this question turned upon whether an offence under Section 5(2) of the Prevention of Corruption Act was non cognizable or cognizable.
The 400 High Court held that an offence under Section 5(2) of that Act was non cognizable because it was not an offence for which any police officer could arrest without a warrant.
The same argument which was canvassed before the High Court was repeated before this Court.
And it was contended that the words 'a police officer ' in Section 4(1) (f) of the Code mean 'any ' police officer.
This argument was repelled by this Court and it was held that such an approach could not be a criterion for deciding whether the offence is cognizable or non cognizable.
It was observed: "If we pursue the same line of argument and look at the definition of non cognizable offence in Section 4(1) (n) which defines non cognizable offence as an offence for which a police officer, within or without a Presidency town, may not arrest with.
out warrant, it might mean that as these are cases where a police officer of the rank of Dy.
Superintendent and above can arrest without warrant these are not non cognizable offences either How can there be a case which is neither cognizable nor non cognizable? It was sought to be argued that these offences would be cognizable offences when they are investigated by the Deputy Superintendents of Police and superior officers and non cognizable when they are investigated by officers below the rank of Deputy Superintendents.
We fail to see how an offence would be cognizable in certain circumstances and non cognizable in certain other circumstances.
We do not consider that this is a reasonable interpretation to place.
" Once we hold that a Commissioner of Police who is competent to direct by issuing special warrant or general order, under Section 6(1)(i), another police officer of the requisite rank to arrest persons found gambling or present in a gaming house, can also arrest personally the offender concerned, the principle enunciated by this Court in Lala 's case is immediately attracted in full force and there is no escape from the conclusion that offences under Sections 4 and S of the Bombay Prevention of Gambling Act are cognizable.
Such offences are admittedly bailable.
It follows as a necessary corollary therefrom, that the commissioner of Police or the police officer who is authorised by him to search, arrest and investigate such offences is under a legal obligation to release the accused on bail under the provisions of Section 496 of the Code.
The authority to grant bail to the person arrested in execution of such a warrant is derived by the officer arresting, from the statute and consequently, no executive instructions or administrative rules can abridge, or run counter to the statutory provisions of the Code.
Since the impugned order or 401 executive instructions are contrary to or inconsistent with the provisions of the Code and on a true construction, there is nothing in Section 6 or any other provision of the Act which takes away the right and power conferred by The Code on the police officer to grant bail to the person arrested by him for offences under Sections 4 and 5 of the Act, the impugned order was ultra vires and bad in law and had been rightly quashed by the High Court.
In the result, the appeal fails and is dismissed.
Appeal dismissed.
[/INST]The respondent Piara Singh was apprehended in September 1958 by the Indian Police while crossing the Indo Pakistan border into Pakistan.
A sum of Rs. 65,500/ in currency notes was recovered from his person.
On interrogation he stated that he was taking the currency notes to Pakistan to enable him to purchase gold in that country with a view to smuggling it into India.
The Collector of Central Excise and Land Customs ordered the confiscation of the currency notes.
In the proceedings initiated by the Income Tax Officer, he found that Rs. 60,500/ constituted the income of the assessee from undisclosed sources.
An appeal by the assessee was dismissed by the Appellate Assistant Commissioner.
In second appeal before the Income Tax Appellate Tribunal, the assessee represented that if he was regarded as engaged in the business of smuggling gold he was entitled to a deduction under section 10(1) of the Income Tax Act, 1922 of the entire sum of Rs. 65,500/ as a loss incurred in the business on the confiscation of the currency notes.
The Tribunal upheld the claim to deduction.
It proceeded on the basis that the assessee was carrying on a regular smuggling activity which consisted of taking currency notes out of India and exchanging them with gold in Pakistan which was later smuggled into India.
The High Court on a reference at the instance of the Revenue answered the reference against the Revenue.
Hence the appeal.
Allowing the appeal, the Court.
^ HELD: 1.
The assessee is entitled to the deduction of Rs. 65,500/ under section 10(1) of the Income Tax Act, 1922.
[1124 C, 1126 B] 2.
The assessee was carrying on the business of smuggling and, therefore, was liable to income tax on income from that business.
The currency notes carried by the assessee across the border was an essential part of the smuggling operation.
If the activity of smuggling can be regarded as a business, those who are carrying on that business must be deemed to be aware that a necessary incident involved in the business is detection by the Customs authorities and the consequent confiscation of the currency notes.
It is an incident as predictable in the course of carrying on the activity as any other feature of it.
Having regard to the nature of the activity possible detection by the Customs authorities constitutes a normal feature integrated into all that is implied and involved in it.
The confiscation of the currency notes is a loss occasioned in pursuing the business; it is a loss in much the same way as if the currency 1123 notes had been stolen or dropped on the way while carrying on the business.
It is a loss which springs directly from the carrying on of the business and is incidental to it.
Applying the principle laid down by this Court in Badridas Daga vs Commissioner of Income Tax the deduction must be allowed.
[1124 D E] Badridas Daga vs Commissioner of Income Tax, ; Commissioner of Income Tax, Gujarat vs section C. Kothari ; applied.
Haji Aziz and Abdul Shakoor Bros. vs Commissioner of Income Tax, Bombay City II, , Sari Hinduji Khushalji 7 Co. vs Commr.
of Income Tax, A.P. ; J. section Parkar vs V. B. Palekar and Ors.
; distinguished and explained.
</s>
|
<s>[INST] Summarize the judgementAppeal No. 1456 of1966.
Appeal from the judgment ,and order dated April 6, 1964 of the Gujarat High Court in Letters Patent Appeal No. 8 of 1960.
D.U. Shah, P.C. Bhartari and J.B. Dadachanji, for the ' appellants.
S.K. Dholakis and Vineet Kumar, for respondents Nos. 1 (a) to 1(e)and (g).
The Judgment of the Court was delivered by Shah, J.
The facts which give rise to these appeal are few and simple.
The appellant commenced on May 3, 1951 an action in the Court of the Assistant Judge, Morvi, in the former Part 'B ' State of Saurashtra for a decree for Rs. 9,387/5/ against one L. Angha Nathu Jamal and respondents 2 & 3 in this appeal.
The Trial Court decreed the suit on October 17, 1955.
An appeal was filed against the decree in the High Court of Saurashtra at Rajkot.
On November 1, 1956, the High Court of Saurashtra was abolished and the proceedings pending in that Court stood ' transferred to the High Court of Bombay.
On February 21,. 436 1958, Vyas, J., of the High Court of Bombay allowed the appeal.
Against that order an appeal under C1.
15 of the Letters Patent of the High Court of Bombay was filed by the plaintiff but without an order of Vyas, J. certifying that the case was fit for appeal to a Division Bench of the High Court.
On May 1, 1960 under the Bombay Reorganisation Act 1960, the appeal stood transferred to the High Court of Gujarat.
The High Court of Gujarat held that the appeal was incompetent in the absence of an order under section 22A of the Saurashtra Ordinance 2 of 1948 certifying that the case was fit for appeal to a Division Bench.
With certificate granted by the High Court of Gujarat this appeal has been preferred.
The Rulers of Indian States in Kathiawar agreed "to unite and integrate" their territories in one State to be styled the United State of Saurashtra with a common executive, legislature and judiciary.
By Ordinance 1 of 1948 the administration of the covenanting States was taken over by the Rajpramukh.
The Rajpramukh issued, in exercise of power reserved to him by article 9 el.
(3) of the Covenant, Ordinance 2 of 1948 setting up with effect from February 29, 1948, a High Court of Judicature for the State of Saurashtra.
The expression "High Court" was defined in section 3(c) as meaning "the High Court established and constituted by this Ordinance and functioning as the High Court of the Saurashtra State.
By section 21 the High Court was to be the highest Court of appeal and revision in the State and to have jurisdiction to maintain and dispose of such appeals, revision and other cases, civil or criminal, as it may be empowered to do under the Ordinance or any enactment in force in the State.
By section 22 the High Court was also to be a Court of reference with power to hear, revise and determine all eases referred to it.
By Ordinance 5 of 1950 section 22A was added: it vas provided thereby: "( 1 ) Except as otherwise provided by any enactment for the time being in force, an appeal from any original decree, or from any.
order against which an appeal is permitted by any law for the time being in force, or from any order under Article 226 of the Constitution of India, made by a single Judge of the High Court, shall lie to a Bench consisting of two other Judges of the High Court.
(2) An appeal shall lie from a judgment of one Judge of the High Court in respect of a decree or order made in exercise of Appellate; Jurisdiction to a Bench consisting of two other Judges of the High Court if the Judge who made the decree or order certifies that the case is a fit one for appeal:" 437 Under the Constitution of India, the territory of the United State of Saurashtra was formed into a Part 'B ' State of Saurashtra.
By the the territory of the State of Saurashtra merged into the State of Bombay.
By section 49 of the States Reorganization Act, 1956, it was enacted that the High Court exercising immediately before the appointed day, jurisdiction in relation to the existing State of Bombay shall, as from the appointed day, be deemed to be the High Court for the new State of Bombay.
By section 50(1) as from the appointed day, the High Courts of all the existing Part B States (with certain exceptions not material) were to cease to function and were abolished.
By section 52 was provided: "The High Court for a new State shall have, in respect of any part of the territories included in that new State, all such original, appellate and other jurisdiction as, under the law in force immediately before the appointed day, is exercisable in respect of that part of the said territories by any High Court or Judicial Commissioner 's Court for an existing State".
By section 54 it was provided: "Subject to the provisions of this Part, the law in force immediately before the appointed day with respect to practice and procedure in the High Court for the corresponding State shall, with the necessary modifications, apply in relation to the High Court for a new State, and accordingly, the High Court for the new State shall have all such powers to make rules 'and orders with respect to practice and procedure as are, immediately, before the appointed day, exercisable by the High Court, for the corresponding State: Provided that any rules or orders which are in force immediately before the appointed day with respect to practice and procedure in the High Court for the corresponding State shall, until varied or revoked by rules or orders made by the High Court for a new State, apply with the necessary modifications in relation to practice and procedure in the High Court for the new State as if made by that Court".
Section 59(3) provided that all proceedings pending in the High Court of Saurashtra or in the Court of the Judicial Commissioner for Kutch immediately before the appointed day shall stand transferred to the High Court of Bombay.
By section 119 it was provided: "The provisions of Part II shall not be deemed to have effected any change in the territories to which any L2Sup .CI/70 6 438 law in force immediately before the appointed day extends or applies, and territorial references in any such law to an existing State shall, until otherwise provided by a competent Legislature or other competent authority, be construed as meaning the territories within that State immediately before the appointed day." Section 127 provided: "The provisions of this Act shall have effect notwithstanding anything inconsistent therewith contained in any other law.
" In exercise of the power conferred upon the Central Government by section 120 of the , the Saurashtra (Adaptation of Laws on Union Subjects) Order, 1957, was promulgated by the Central Govt.
By cl. 3 of the order it was provided that Saurashtra Ordinance 2 of 1948 shall stand repealed with effect from November 1, 1956.
The High Court of Bombay for the new State added rr.
252 A and 252 B to the Rules of the High Court of Judicature at Bombay, Appellate Side, 1950.
By r. 252 A it was provided: "Rules and orders relating to.
practice and procedure in the High Court in force immediately prior to the appointed day in the High Court of Bombay shall, subject to.
modifications made from time to time thereto, apply to the practice and procedure in the High Court.
" Rule 252 B provided: "Rules and orders relating to practice and procedure in the High Court framed by the High Courts of Nagpur, Hyderabad and Saurashtra and Judicial Commissioner 's Court, Kutch, shall stand abrogated as from the 1st November 1956 in the areas of the new State of Bombay which before the 1st November 1956 were parts of the States of Madhya Pradesh, Hyderabad, Saurashtra and Kutch." The High Court of Gujarat held that the appeal filed by the respondents in the High Court of Saurashtra against the judgment of the Assistant Judge, was and continued to remain subject to the provisions of section 22A of Saurashtra Ordinance 2 of 1948 and an appeal could lie against the decision of Vyas J., only if he certified that the case was fit for appeal to a Division Bench.
Clause 15 of the Letters Patent of the Bombay High Court provided: "And we do further ordain that an appeal shall lie to the said High Court of Judicature at Fort William in Bengal from the judgment (not being a judgment passed in the exercise of appellate jurisdiction in respect of a 439 decree or order made in the exercise of appellate jurisdiction by a Court subject to the superintendence of the said High Court, and not being an order made in the exercise of revisional jurisdiction and not being a sentence or order passed or made in the exercise of the power of superintendence under the provisions of section 107 of the Government of India Act or in the exercise of criminal jurisdiction) of one Judge of the said High Court or one Judge of any Division Court, pursuant to section 108 of the Government of India ACt, and that notwithstanding anything hereinbefore provided an appeal shall lie to the said High Court from a judgment of one Judge of the said High Court or one Judge of any Division Court, pursuant to section 108 of the Government of India Act made on or after the; first day of February 1929) in the exercise of appellate jurisdiction in respect of a decree or order made in the exercise of appellate jurisdiction by a Court subject to the superintendence of the said High Court, where the Judge who passed the judgment declares that the same is a fit one for appeal; but . .right of appeal from other judgments of Judges of the said High Court or of such Division Court shall be to Us, Our Heirs or Succes SOTS. " By cl. 15 of the Letters Patent a judgment in an appeal from a civil suit by a single Judge of the High Court of Bombay is subject to appeal to a Division Bench except when the order is made in exercise of the revisional jurisdiction of the Court or in second appeal, or in exercise of criminal jurisdiction, or in exercise of power of superintendence under section 107 of the Government of India Act, 1935 (article 227 of the Constitution).
Vyas, J, decided the appeal sitting as a Judge of the High Court of Bombay.
Prima facie, his judgment delivered in a first appeal from a judgment of the subordinate court was subject to appeal 0 a Division Bench of the High Court of Bombay.
There was clearly an inconsistency between section 22A of the Saurashtra Ordinance 2 of 1948, and cl. 15 of the Letters Patent of the High Court of Bombay.
By virtue of section 22A(2) an appeal lay to a Division Bench of the Saurashtra High Court from a judgment of one Judge "in respect of a decree or order made in exercise of Appellate Jurisdiction when the Judge who made the decree or order certified that the case is a fit one.
for appeal".
The Legislature made no distinction between a first appeal, a second appeal, an appeal from order land an application in exercise of revisional jurisdiction.
But an appeal under cl. 15 of the 440 Letters Patent of the High Court of Bombay in be appeal from filed without the judgment of the Court of First Instance could a certificate of the Judge hearing the appeal.
The right to appeal from a decree or order is a substantive right.
As a corollary thereto, the right to maintain a decree of a Court without interference by a superior Court and subject only to the limitation therein is also a vested right and may be taken away by express enactment or clear implication of the amending statute.
In Colonial Sugar Refining Company vs Irving(x) the Judicial Committee held that a provision which deprives a suitor in a pending action of an appeal to a superior tribunal which belonged to him as of right does not regulate procedure.
The Australian Commonwealth Judiciary Act, 1903, came into force on August 25, 1903.
Against the judgment of the Supreme Court of Queens land in an action commenced on Act.
25, 1902, an application was made for leave to appeal to the Judicial Committee and leave was granted on September 4, 1903.
At the hearing of the appeal by the Judicial Committee the respondents applied that the appeal from the judgment of the Supreme Court of Queensland be dismissed on the ground that the power of the Court below to give leave to ,appeal stood abrogated by section 39 of the Australian Commonwealth Judiciary Act, 1903.
The application was rejected by the Judicial Committee.
Lord Macnaghten observed: As regards the general principles applicable to the case there was no controversy.
On the one hand it was not disputed that if the matter in question be a matter of procedure only, the petition (to dismiss) is well founded.
On the other hand, if it be more than a matter of procedure, if it touches a right in existence at the passing of the Judiciary Act, it was conceded that in accordance with a long line of authorities from the time of Lord Coke to the present day the appellants (the Sugar Co.) would be entitled to succeed.
The Judiciary Act is not retrospective by express enactment or by necessary intendment.
And therefore, the only question is, was the appeal to His Majesty in Council a right vested in the appellants at the date of the passing of the Act, or was it a mere matter of procedure ? .It seems to their Lordships that the question does not admit of doubt.
To deprive.
a sui tor in a pending action of an appeal to a superior tribunal which belonged to him as of right is a very different thing from regulating procedure".
(1) 441 In Garikapatti Veeraya vs
N. Subbiah ChoudhurY(1), this Court accepted the principle in Colonial Sugar Refining Company 's case(2).
In the absence of any provision to the contrary, there fore, a right attached to the action when it was commenced in 1951, that an appeal against the decision of a single Judge of the High Court of Saurashtra shall lie only if the Judge deciding the case certified the case to be a fit one for appeal.
But the Saurashtra High Court was abolished from November 1, 1956 and the jurisdiction of the Saurashtra High Court was conferred upon the Bombay High Court.
The case was tried by Vyas, J., not as a Judge of the Saurashtra High Court but as a Judge of the High Court of Bombay.
In terms the restriction placed by section 22A applies to a judgment of one of the Judges of the High Court of Saurashtra: it does not apply to a judgment of a Judge of the High Court of Bombay.
Once the Saurashtra Ordinance 2 of 1948 was repealed and the jurisdiction to try the appeal was conferred upon the High ' Court of Bombay, the right of appeal exercisable by the parties to the litigation decided by the High Court of Bombay was governed by the Letters Patent of that court had not by section 22A of the Saurashtra Ordinance 2 of 1948.
Granting that the incident prescribed by section 22A continued to attach to the action, in terms section 22A of the Saurashtra Ordinance could not operate to restrict a right of appeal exercisable by cl. 15 of the Letters Patent governing the judgments of the Judges of the High Court of Bombay.
The expression "Judge of the High Court" in section 22A of the ordinance for the ' purpose of giving effect to the rule in Colonial Sugar Refining Company 's case(2) cannot be read as meaning a Judge of the High Court of Bombay.
By the clearest implication of the repeal by the Saurashtra (Adaptation of Laws on Union subjects) Order, 1957, promulgated by the Central Government and by the application of cl. 15 of the Letters Patent of the Bombay High Court, the judgment of Vyas, J., was subject to appeal to a Division Bench without an order of the Learned judge certifying the case to be fit for appeal.
In support of his submission counsel for the respondents relied upon the terms of section 52 of the .
But that section only confers upon the High Court of Bombay after November 1, 1956 the original, appellate and other jurisdiction, which was exercisable by the High Court of Saurashtra immediately prior to November 1, 1956, in respect of the territories within the State of Saurashtra.
The section does not incorporate either expressly or by implication the limitations prescribed by section 22A(2) of Saurashtra Ordinance 2 of 1948 into the Letters Patent of the High Court of Bombay.
The jurisdiction original, appellate and other which the High Court of Saurashtra could exercise prior to November 1, 1956, survived to the High Court (1) ; (2)[1905] A.C.360.
442 of Bombay in respect of the territories of the State of Saurashtra, and the appeal filed by the respondent before the High Court of Saurashtra was triable in the exercise of the appellate jurisdiction of the High Court of Bombay, after the case stood transferred to that Court by virtue of sub section
(3) of section 59 of the States Reorganization Act, 1956.
Vyas, J., functioned as a Judge of the High Court of Bombay and his judgments in first appeals were, in the absence of an express provision to the contrary, subject to appeal under cl. 15 of the Letters Patent to a Division Bench without a certificate.
The High Court of Gujarat was right in holding that in respect of the areas of the former Saurashtra State, the High Court Bombay acquired the same jurisdiction which the High Court of Saurashtra possessed.
That however, does not mean that the jurisdiction was to be regulated "with reference to the law which was in force on the appointed day i.e. November 1, 1956".
Section 52 of the preserved the original, appellate and other jurisdiction as under the law in force immediately before the appointed day exercisable in respect of the territories within the State of Saurashtra.
Unless in the exercise that jurisdiction any restriction under the law then in force was by express provision or by clear implication preserved, the provisions of cl. 15 of the Letters Patent must apply.
It is necessary to recall the provisions of section 57 of the , which provide that the law in force immediately before the appointed day relating to the powers of the Chief Justice, single Judges and division courts of the High Court for the corresponding State and with respect to matters ancillary to the exercise of the powers shall, with the necessary modification, apply in relation to the High Court for a new State.
Immediately before November 1, 1956, against the judgment of a single Judge of the High Court of Bombay exercising power in a first appeal, an appeal lay to a Division Bench without a certificate.
The power of a Division Bench to entertain an appeal continued to remain exercisable by the Judges of the Bombay High Court when dealing with cases transferred under section 59(3) to the Bombay High Court from the Saurashtra High Court.
In terms section 57 provides that powers of the Division Bench of the High Court for the corresponding State i.e. the new State of Bombay shall be the same as the powers of the Division Bench under the law in force immediately before the appointed day in the State of Bombay.
A Division Bench of the High Court of BOmbay was competent to entertain an appeal against the judgment of a single Judge deciding a first appeal from the decision of a subordinate court without a certificate of the Judge deciding the appeal.
443 The High Court of Gujarat have made a distinction between 'power" and "jurisdiction", and they have held that when section 52 of the , enacts that the appellate jurisdiction of the High Court of Bombay for the new State of Bombay shall in relation to the Saurashtra area be the same as the jurisdiction which the Saurashtra High Court possessed, it is meant that the High Court of Bombay has the same jurisdiction which the High Court of Saurashtra originally had, and in exercise of that jurisdiction is subject to the same limitations which the High Court of Saurashtra was subject.
We are unable to agree with that view.
Section 52 of the States Reorganization Act, 1956, does not say so, and section 57 of that Act provides to the contrary.
The High Court of Gujarat was also of the view that section 52 of the "crystalizes the law" only with respect to the territorial jurisdiction of each of the areas comprised in the High Court of Bombay, and if the Legislature extended the jurisdiction of the High Court of Bombay and also retained the jurisdiction which the abolished High Court possessed, the result would be "odd and conflicting" there being conflict of jurisdiction.
But that, in our judgment, is a ground for holding that the jurisdiction of the Bombay High Court superseded in case of conflict, the restrictions on the exercise of jurisdiction by the original High Court qua the Saurashtra territory, and not that the jurisdiction of the High Court of Bombay was because of some unexpressed limitation restricted.
The High Court of Gujarat recognised that the conclusion to which they had reached revealed a defect in the administration of justice.
They observed: "The Legislature may have had a good reason for preserving in tact the old jurisdiction of the Saurashtra High Court in regard to pending cases.
However, our conclusion affects cases instituted after the Reorganisation Act came into force.
In our judgment, there is no reason why the litigants from the Saurashtra and Kutch areas should now be treated on a different footing from the litigants in the old Bombay area.
In our judgment, the rights of appeal of litigants in all the areas should now be placed on the same footing.
live would recommend to the authorities concerned to examine this question and, if so advised, to undertake the necessary legislation so as to confer the same rights of appeal to the litigants from the Saurashtra & Kutch areas as are given to the litigants from the rest of the State of Gujarat.
" 444 In our view the conclusion that the restriction on the "old jurisdiction of the Saurashtra High Court" in regard to.
pending cases was preserved by section 52 is erroneous.
_ The does not purport to.
preserve the restrictions upon the exercise of jurisdiction, and no implication arises from the use of the expression "original, appellate and other jurisdiction as under the law in force immediately before the appointed day", that the limitations upon the exercise of the jurisdiction which were existing prior to November 1, 1956, notwithstanding the provisions of section 57 of the were preserved.
The order passed by the High Court of Gujarat is set aside, and the case is remanded to the High Court to be re entered under the original number and to be heard and disposed of according to law.
Costs wilt be costs in the High Court.
V.P.S. Appeal allowed and case remanded.
[/INST]S, the owner of some land in a village in Punjab, died leaving a widow and the respondent, his daughter by another wife.
The widow sold a part of the land in February 1958 to the appellants, whereupon the respondent filed a suit for possession by pre emption of the land sold.
The trial court decreed the suit and a first appeal was dismissed.
A single bench of the High Court allowed the second appeal on the view that the respondent not being the widow 's daughter, had no right of pre emption under section 15(2) of the Punjab Pre emption Act, 1913, as amended by the Punjab Pre emption Amendment Act, 1960.
However, a division bench in a Letters Patent appeal, relying on an amendment made by the PUnjab Preemption Amendment Act, 1964 in section 15(2)(b), reversed the judgment of the single bench and decreed the suit.
It was contended in appeal to this Court that there is no indication in the Amendment Act of 1964 that it is to have retrospective operation and the amendment made by it should be deemed to be only prospective.
HELD: The Amendment Act of 1964 was merely of a clarificatory or declaratory nature.
Even in the absence of words which were inserted by the Amendment Act of 1964 under section 15(2)(b) the only possible interpretation and meaning of the words "in the son or daughter of such female" could have reference to and cover the son or daughter of the husband of the 'female.
The entire scheme of section 15(2) is that the right of pre emption has been confined to the issues of the last male holder from whom the property which has been sold came by inheritance.
[805 H] Under section 15(2)(b) the right of pre emption would vest firstly in the son or daughter of the husband of the female meaning thereby either her own off springs from the husband whom she had succeeded or the son or daughter of that husband even from another wife.
[806 G] In the present case the respondent was entitled to exercise her right of pre emption under paragraph First of clause (b) of section 15(2) even before the Amendment of 1964.
Whatever doubts existed they were removed by that Act which must be given retrospective operation.
[807 E F] Ram Sarup vs Munshi & Ors, ; and Mota Singh vs Prem Parkash Kaur & Ors., I.L.R. [1961] Punj.
614, 627; referred to.
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<s>[INST] Summarize the judgementN: Criminal Appeal No. 251 of 1972 and 243 of 1973.
Appeals by Special Leave from the Judgment and order dated 22 9 72 of the Madras High Court in Criminal Appeal No. 369/72 and 976/71.
Debaratea Mookerjee, M. section K. Sastri and M. section Narasimhan for the Appellants.
A. V. Rangam and Miss A. Subhashni, for the Respondents.
877 The Judgment of the Court was delivered by UNTWALIA, J.
Criminal Appeal No. 251 of 1972 has been filed under section 2 of the and Criminal Appeal No. 243 of 1973 is by special leave.
In all there are six appellants.
It would be convenient to refer to them with reference to their accused number given in the judgment of the Sessions Court.
They are as follows: Accused No. 1 (A 1) Ramaswami Ayyangar.
Accused No. 2 (A 2) Vattappan.
Accused No. 3 (A 3) Kaipillai alias Karuppayyan.
Accused No. 4 (A 4) Raman.
Accused No. 5 (A 5) Kathayyan.
Accused No. 6 (A 6) Kulandaiyan.
The occurrence giving rise to these two appeals took place on Monday the 21st April, 1971 at about 4.00 p.m. at Sivan Koil tank in village Thaduthalkondapuram.
In the said occurrence was seriously injured one Kaliaperumal who later died in the Hospital at about 9.00 p.m. the same evening.
Another person injured in the occurrence was also named Kaliaperumal, P.W. 1.
The prosecution case is that deceased Kaliaperumal was living with his maternal uncle Pichai Konar, P.W. 7 since infancy.
A 1 is the Karnam of the village and A 6 is the Government vetti.
A 2 and A 3 are brothers, A 4, A 5 and A 6 are also inter se brothers.
A 2 to A 6 worked under A 1.
There was enmity between P.W. 7 and the deceased on the one hand and A 1 on the other on account of several causes.
The facts showing the enmity between them are stated in the judgments of the courts below and are not necessary to be detailed here.
Two days prior to the occurrence Marimuthu, P.W. 10 was driving some cattle, 4 or 5 of them went astray and entered into the Gingillillai (field) belonging to A 1.
A 1 's men scolded P.W. 10 and the deceased who was informed about the incident by the former at a tea shop.
P.W. 1 was also present there.
Deceased Kaliaperumal passed on the information to P.W. 7.
Ramalingam, P.W. 4 brother of the deceased was taking his bath in the Sivan Koil tank.
Kaliaperumal (deceased) also came there saying something against the Karnam.
He also started bathing at the north western corner of the tank.
According to the prosecution case, A 1 came there followed by A 2 to A 6.
A 2 had a cross stop (an instrument used in Survey and measurement, perhaps the correct name of the instrument is cross staff).
A 3 and A 4 were each armed with an Aruval.
A 5 had a stick and A 6 was carrying a stick with a spear attached to it.
According to the evidence in Court, A 1 told the other accused "Not content to with grazing (his) cattle in my gingilly field, he is also abusing me.
Cut him, whatever be the expenses, I will look after that.
" Thereupon A 4 asked the deceased Kaliaperumal "Why are you abusing the 'Iyer ' ?" Saying something Kaliaperumal ascended the bank.
A 3 and A 4 assaulted him on his head with Aruvals.
P.W. 1 ran to separate them when A 2 assaulted him on 878 his head with the cross stop.
P.W. 1 attempted to run.
Thereupon it is said A 6 obstructed him from running with the help of the stick with spear head.
A 4 again cut on the head of Kallaperumal (deceased) with his Aruval.
A 2 beat on P.W 's head with the cross stop hour or five times.
P.W. 1 fell down unconscious.
P.W. 7 and others took the injured to the Government Dispensary Kodavasal.
Dr. Radha Singh, Civil Assistant Surgeon, P.W. 15 examined Kallaperumal deceased at 4.55 p.m. and issued a Wound Certificate.
Since his condition was serious he was sent to the Government Hospital, Kumbakonam.
P.W.15 examined the injuries or P.W. 1 at 5.20 p.m. and found as many as nine injuries on his person.
As already stated Kaliaperumal died at about 9.00 p.m.
Dr. N. Jayaraj, P.W. 18 performed the autopsy over the dead body.
As many as 14 injuries were found.
The injuries given on the head with Aruval according to the opinions of the Doctors were sufficient in the ordinary course of nature to cause his death.
Various charges were framed against the six accused including that of rioting under section 147 IPC against A 1 and A 5 and section 148 against A 2, A 3, A 4 and A 6.
A 1 was further charged under sections 302/149 and sections 302/109.
A 2 to A 6 were charged under section 302.
An extra charge under section 324 was levelled against A 2 for causing simple hurt to P.W. 1 with the cross stop, an instrument which had sharp edges.
A 6 was also charged under section 341 of the Penal Code for preventing P.W. 1 from escaping.
The accused denied their complicity in the occurrence and pleaded not guilty.
A 1 took a plea of alibi also and asserted that he had gone to Madras in connection with some marriage negotiations.
Two days after the date of occurrence he was arrested at Kumbakonam Railway Station when he alighted from the train on his return from Madras.
The Trial Judge acquitted A 1, A 5 and A 6 of all the charges.
He convicted A 3 and A 4 under section 302 of the Penal Code and awarded a sentence of life imprisonment to each of them.
They were acquitted of the charge under section 148.
A 2 was convicted only under section 324 with a sentence of 4 months ' rigorous imprisonment and acquitted of all other charges.
A 2, A 3 and A 4 preferred an appeal in the Madras High Court against their conviction and the sentences imposed upon them by the Trial Court.
State preferred an appeal against the acquittals of A 1, A 5 and A 6 as also against the acquittal of A 2 of the charge under section 302.
It, however, did not prefer any appeal against the acquittal of A 2, A 3 and A 4 of the charge under section 148 of the Penal Code.
Yet it is surprising to find that the High Court has convicted all the six accused for the offences of rioting, A 1 and A 5 under section 147 with two years ' rigorous imprisonment and A 2, A 3, A 4 and A 6 under section 148 with 3 years ' rigorous imprisonment.
Conviction of A 3 and A 4 for the offence of murder under section 302 has been maintained with the aid of section 34.
High Court has also convicted A 2, A 5 and A 6 under sections 302/34 and awarded each of them life imprisonment.
A 1 has been convicted by the High Court under sections 302/149 and 302/109 with sentence 879 of life imprisonment under each.
Conviction of A 2 under section 324 has been maintained.
Hence these two appeals.
That there was enmity and bad blood between A 1 and P.W. 7 is not open to any doubt.
An occurrence did take place on the date, time and place as given by the prosecution.
The manner of occurrence in so far as it relates to the attack on the deceased is concerned by A 2 and A 3 has also been proved to the hilt.
The factum of assault by A 2 on P.W. 1 also does not admit of any doubt.
But the High Court does not seem to be justified in reversing the order of acquittal recorded by the Trial Court in favour of A 1, A 5 and A 6.
It was claimed by the prosecution that apart from P.W. 1 there were four more eye witnesses to the occurrence namely Govindaswami, P.W. 3, Ramalingam, P.W. 4, Rajagopal, P.W. 5, and Kaliaperumal, P.W. 6.
P.Ws 3 and 4 are brothers of the deceased.
P.W. 5 is the brother in law of P.W. 3.
P 1 is the statement of P.W. 1 before the police on the basis of which the First Information Report was drawn up.
On reading this statement as also the evidence of P.W. 1 in Court, the Trial Judge rightly came to the conclusion that P.Ws. 3, 4, 5 and 6 arrived at the scene of occurrence after it had taken place.
None of them had witnessed it.
It considered the evidence of each witness, viz. P.Ws.
3 to 6, individually and did not rely upon it.
In our judgment, the High Court was not right as against the explicit statement and evidence of P.W. 1 in reading P.Ws.
3 to 6 as eye witnesses to the occurrence.
It is significant to note that although P.Ws. 3 and 4 were the brothers of the deceased Kaliaperumal but none of them made any attempt to save him form the attack of the assailants.
Had they been present at the occurrence surely they would have tried to save their brother, as was done by P.W. 1.
We are, therefore, left with the evidence of P.W. 1 alone.
Since he was injured in the same occurrence, undoubtedly, his ocular version of the incident is of great value to the prosecution.
The plea of alibi set up by A 1 has not been substantiated at all.
The Trial Judge was not right in doubting the prosecution case merely because A 1 had applied for leave on the 18th April 3 days before the occurrence.
There was no evidence to show that he was at Madras on the date of occurrence.
According to the Investigating Agency, A 1 was arrested not on the Railway platform but near the Railway level crossing of Kumbakonam Railway Station.
But the Trial Court was right in saying that the only part attributed to A 1 was the order giving for assault.
In the statement Ext.
P 1 the only words of order attributed to A 1 are "to cut".
In court there was great embellishment and improvement in the evidence of P.W. 1 when he put several sentences in the mouth of A 1 at the time of the alleged order giving.
As already stated, A 1 was the Karnam of the village and even if he was at the back of the assault on the deceased it does not stand to reason that he himself would go to the place of occurrence merely for giving the order for assault.
The order, if any, must have been given to the assailants in secret by A 1.
He must not have come to the place of occurrence merely for this purpose.
We 880 are, therefore, of the view that although the High Court in its judgment purported to keep in front the well settled principles of law to justify an interference by it with the order of acquittal, it did commit a mistake in the applications of those principles.
Conviction of A 1 by the High Court under any count is not justified.
So do we find in the case of A 5 and A 6 that they had not taken any part in the occurrence at all.
The alleged obstruction given by A 6 to P.W. 1 when he wanted to run was not believable and has not been believed by the Trial Court.
The reasons given by the Trial Court for their acquittal were not such as to justify an interference by the High Court.
The view taken by the Trial Court was reasonably possible to be taken.
Coming to the case of A 2 we find that he did assault P.W. 1 with the cross staff marked Ext.
This cross staff, as alleged, has been recovered from the house of A 1.
The Trial Court, rightly, did not believe the story of its recovery from his house.
But surely A 2 had used the cross staff for assaulting P.W. 1.
A serious question for consideration is whether his conviction under section 302 with the aid of section 34 is justified or not.
In this connection we find the statement of P.W. 1 in Ext.
P 1 to the following effect: "Raman too with the aruval in his hand dealt a cut at the front portion of his head.
I ran there to prevent it.
At that time Vattappan with the string fixed wood he was having in his hand beat on my head.
" In the Sessions Court also he deposed: "Thereupon, Accused No. 3 immediately cut on the head of Kaliyaperumal in the front portion with the aruval he was having in his hand.
I ran to separate them.
Immediately Accused No. 2 beat on my head with M.O. 1. .
Then accused number 2 beat on my head with M.O. 1, 4 or 5 times.
I fell down unconscious.
After some time, President Kaliyaperumal, Rajagopal, Mani alias Rajagopal, Ramalingam, Govindaswami these persons came there.
From the evidence of P.W. 1 corroborated as it is from his statement in Ext.
P 1 it is clear that P.W. 1 wanted to save Kaliyaperumal the deceased, from the murderous attack by A 3 and A 4.
A 2 was standing as a guard and did not allow P.W. 1 to protect the deceased.
A 2 went to the length of assaulting P.W. 1 and making him fall down unconscious.
It is contended that A 2 cannot be held vicariously liable with the aid of section 34 for the act of A 3 and A 4, for two reasons: Firstly, he did not physically participate in the fatal beating administered by A 3 and A 4 to the deceased and thus the "criminal act" of murder was not done by all these three accused within the contemplation of section 34, the act committed by A 2 in regard to the beating of P.W. 1 being a different and separate act of A 2.
Secondly, it has not been shown that the act of A 2 in beating P.W. 1 was committed in 881 furtherance of the common intention of all the three, pursuant to a pre arranged plan.
The contention is fallacious and cannot be accepted.
Section 34 is to be read along with the preceding section 33 which makes it clear that the "act" spoken of in section 34 includes a series of acts as a single act.
It follows that the words "when a criminal act is done by several persons" in section 34, may be construed to mean "when criminal acts are done by several persons".
The acts committed by different confederates in the criminal action may be different but all must in one way or the other participate and engage in the criminal enterprise, for instance, one may only stand guard to prevent any person coming to the relief of the victim or to otherwise facilitate the execution of the common design.
Such a person also commits an "act" as much as his co participants actually committing the planned crime.
In the case of an offence involving physical violence, however, it is essential for the application of section 34 that the person who instigates or aids the commission of the crime must be physically present at the actual commission of the crime for the purpose of facilitating or promoting the offence, the commission of which is the aim of the joint criminal venture.
Such presence of those who in one way or the other facilitate the execution of the common, design, is itself tantamount to actual participation in the 'criminal act '.
The essence of section 34 is simultaneous consensus of the minds of persons participating in the criminal action to bring about a particular result.
Such consensus can be developed at the spot and thereby intended by all of them.
In the case before us, A 2 obviously, was acting in concert with A 3 and A 4 in causing the murder of the deceased, when he prevented PW 1 from going to the relief of the deceased.
Section 34 was therefore fully attracted and under the circumstances A 2 was equally responsible for the murder of the deceased.
Under these circumstances we think the High Court was justified in convicting A 2 for the offence of murder of Kaliyaperumal with the aid of section 34 of the Penal Code.
There was absolutely no difficulty in maintaining the convictions of A 3 and A 4 for the murder of Kaliyaperumal with the aid of section 34 because both had mercilessly assaulted him with Aruvals on the vital parts of the body.
In the case of A 2 also it is quite legitimate to hold that he had shared the common intention of A 3 and A 4 in the commission of the murder of Kaliyaperumal.
The conviction of none of the accused for the offence of rioting can be maintained either in law or on facts.
In the view which we have expressed above that the High Court was not justified in reversing the acquittals of A 1, A 5 and A 6, there were only 3 left in the party of the assailants.
Moreover the State did not file any appeal, as 882 stated already, against the acquittal of A 2, A 3 and A 4 under section 148 of the Penal Code.
That being so, they could not be convicted for having formed an unlawful assembly for any criminal common object.
None could be convicted, therefore, under sections 147 or 148.
Section 149 could not be pressed into service against any.
In the result we allow both the appeals in part, restore the order of acquittal recorded in favour of A 1 viz., Ramaswami Ayyangar, A 5 Kathayyan and A 6 Kulandaiyan acquitting them of all the charges, set aside the conviction of the remaining accused under sections 147 and 148 of the Penal Code and maintain the convictions of A 2 Vattappan, A 3 Kaipillai alias Karuppayyan, A 4 Raman under section 302/34 with the sentence of life imprisonment to each.
We also maintain the conviction of A 2 under section 324 Indian Penal Code with the concurrent sentence of 4 months ' rigorous imprisonment under the said count.
M.R. Appeals partly allowed.
[/INST]The appellant acquired some land in district Jaunpur, for setting up a factory, but did not use the land for such purpose.
Under the U.P. Large Land Holdings Act, 1957, he was required to pay holdings tax for the assessment years 1365 to 1368 Fasli.
The appellant 's application section 143 of the U.P. Zamindari Abolition and Land Reforms Act, for treating his land as industrial land was rejected by the Sub Divisional Officer.
On appeal, the Collector affirmed the order.
In further appeal to the Commissioner, the appellant succeeded as regards the years 1365 and 1366 Fasli.
The State filed revision petitions.
Subsequently the Commissioner held that the appellant was liable to pay holdings tax for the years 1367 and 1368 Fasli.
The appellant also preferred revision applications.
The Board of Revenue decided all the revision petitions in favour of the State, holding that the appellant 's land was "sirdari" and not bhumidari, and it could not be meant for industrial purposes.
The appellant 's petitions under Article 226 of the Constitution were rejected by a Single Judge of the High Court on the ground that the disputed land constituted "land as defined in the Act, and that he was liable to pay the tax.
On appeal, the Division Bench of the High Court affirmed the order.
It was contended before this Court that the land is held for industrial purposes, and is not "land" under sec.
2(15) of the Act.
Dismissing the appeals, the Court, ^ HELD: The appellant holds the land as a sirdar.
Permission to use the land in question for industrial purposes was not granted.
The word "lands" used in the Act is wide enough to include all lands whether agricultural or not.
The appellant cannot escape liability for payment of holding tax by keeping the land in question uncultivated.
[1065 G, 1066C D] Raja Jagannath Baksh Singh vs State of Uttar Pradesh and Another, ; , referred to.
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<s>[INST] Summarize the judgementminal Appeal No. 105 of 1969.
Appeal by special leave from the judgment and order dated March 27, 1969 of the Bombay High Court in Criminal Appeals Nos. 53 and 45 of 1968.
V.S. Kotwal, A. G. Ratnaparkhi and Rajiv Shah, for the appellant.
R. M. Mehta and B. D. Sharma, for the respondent.
The Judgment of the Court was delivered by Khanna, J.
This is an appeal by special leave by Khandu Sonu Dhobi and Bhikanrao Rambhau Khairnar against the judgment of the Bombay High Court affirming on appeal the conviction of the appellants under section 218 read with section 34, section 477A read with section 34 and section 409 read with section 34 of Indian Penal Code as well as under section 5 (2) read with section 5 ( 1 ) (d) of the Prevention of Corruption Act.
Sentence of rigorous imprisonment for a period of one year and a fine of Rs. 200 or in default further rigorous imprisonment for a period of two months has been awarded on each count to, the appellants.
The substantive sentences have ben ordered to run concurrently.
Dhobi appellant No. 1 was an agricultural assistant and was working under Khairnar appellant No. 2 who was agricultural 512 supervisor in the soil conservation section of the Government of Maharashtra.
Dhobi was incharge of the work relating to a Bundh in block No. 13 of village Asane in Taluka Mandurbar.
The above block comprises agricultural lands bearing survey Nos. 8, 17, 18, 19 and 32 measuring 90 acres.
The Bundhs were being constructed since the year 1962.
Rectification work in respect of those Bundhs at a cost of Rs. 369.07 had to be got done by Dhobi appellant under the supervision of Khaimar appellant.
The Government sanctioned an amount of Rs. 4779 in connection with the construction of the Bundhs.
An advance amount of Rs. 5000 was received by Khaimar accused on March 2, 1966 in that connection.
Work of the value, of Rs. 4400 was done but that relating to rectification work was not done.
According to the rules of the soil conservation section, the Government spent the money in the first instance and after the report of the completion of work was received, the expenses were recovered from the landowners for whose benefit the work was done.
On March 11, 1966 Khaimar made entries in measurement book exhibit 27 showing that he had checked 28 payments and certified the, same.
Khaimar accused also stated in the entry that he had passed the measurements and paid Rs. 369.07.
Paysheets exhibit 64 were prepared by Dhobi accused and he obtained the thumb impressions and signatures of the laborers on the paysheets.
Khaimar made his initials below the thumb impressions in the paysheets.
On the last page of the paysheets, Khaimar signed a certificate according to which he had paid Rs. 369.07 to PW 10 Jagan Trinibak who used to do the labour work.
Final bill exhibit 28 was also prepared on that day by the accused and the signature of Jagan Trimbak was obtained on the same.
The bill was got signed from PW 7 Ziparu Tukaram and another person as attesting witnesses.
The bill was signed thereafter by Khaimar.
Debit entry exhibit 32 of Rs. 369.07 was made by Khaimar accused in the cash book.
He also prepared work abstract exhibit 29 on April 16, 1966 and sent it to the sub divisional soil conservation officer Nandurbar showing an expenditure of Rs. 369 07.
The case of the prosecution was that the measurement book exhibit 27, paysheets exhibit 64, final bill exhibit 28 and cash book entry exhibit 32 were false documents and were fabricated by the accused without doing any reification work on the Bundh.
The accused thus committed criminal breach of trust in respect of the amount of Rs. 369.07 in furtherance of their common intention to misappropriate government property.
According further to the prosecution case, the landowners in block No. 13 came to know of the, above, acts of the accused and they complained about it to Sarpanch Tanku Bhagwan (PW 12).
Tanku sent a telegram on April 12, 1966 to the superintending agricultural officer, Bombay division, Nasik in this connection.
A copy of the telegram was 513 thereafter sent by the superintending agricultural officer to divisional soil conservation officer D.S.D. Ghate (PW 1) for necessary action as well as for enquiry and report.
Chate PW went to village Asane on May 2, 1966 and inspected block No. 13.
He found that entries had been made about the payment of Rs. 369.07 in the measurement book and cash book even though no rectification work had been done.
Chate submitted his report on May 6, 1966 for proceeding departmentally against the accused.
On receipt of the above report, the superintending agricultural officer directed P. R. Inamdar (PW 1 1 ), deputy director of agricultural engineering, to go to Asane village and submit his report after personally verifying the facts.
Inamdar went with Ghate to block No. 13 in Asane village on May 11, 1966.
Both Inamdar and Ghate found that no rectification work had been done.
They did not find even a single pit in the lands in that block although, according to measurement book, 83 pits had been recently dug.
Inamdar and Ghate also met the Sarpanch and other landowners of Asane village.
Report dated May 18, 1966 was thereafter submitted by Inamdar affirming those facts.
Sarpanch Tanku sent complaint exhibit 84, in the meanwhile, on April 30, 1966 to the director of anti corruption branch Maharashtra State stating that the accused had prepared false bill for Rs. 369.07 without doing any work and that they had misappropriated that amount.
It was also stated that attempts were being made to shield the accused.
The director of anti corruption sent a copy of that application to Sub Inspector K. G. Patil (PW 13) who was then attached to Dhulia officse of the anticorruption branch.
Sub Inspector Patil made local enquiry and took into possession the measurement book, paysheets and cash book.
The director of anti corruption branch directed Patil to register a case and investigate into the, matter.
Patil went to Nasik and recorded statement exhibit 79 of Inamdar PW on November 7, 1966.
The statement was then sent to Nandurbar Taluka police station.
A case was registered on the basis of that statement at the police station on November 8, 1966.
On November 12, 1966 sub Inspector Patil applied for permission under section 5A of the Prevention of Corruption Act of judicial magistrate 1st class to investigate the offence.
The permission was granted by the judicial magistrate 1st class Nandurbar on the same day.
Patil thereafter recorded statements of a number of persons.
Patil was subsequently transferred and the case was investigated by his successors Mahamuni and Kulkarni who also obtained the requisite permission.
Sanction exhibit 97 for the prosecution of the two accused was granted under section 6 of the Prevention of Corruption Act by the superintending agricultural officer Bombay division, Nasik on May 18, 1967.
514 The two accused in their statements admitted that the work of the value of Rs. 369.07 wasnot done till March 11, 1966 although it was so stated in the various documents by them.
The accused also admitted that no amounts were paid to any of the labourers mentioned in the paysheets although signatures and thumb impressions of the labourers had been obtained on the paysheets on March 11, 1966.
According to the accused, they had prepared the various documents in accordance with the instructions of Ghate PW who was insisting in March 1966, and even earlier, that a completion report relating to block No. 13 be sent as the entire amount spent on that block since 1962 could not be recovered for want of a. completion report.
Khaimar accused added that rectification work had been done between May 13, 1966 and May 16, 1966 and the amount of Rs. 369.07 was thereafter disbursed on May 16, 1966.
The learned special judge held that the amount of Rs. 369.07 had not been paid by the two accused to the labourers.
No work, it was found, had been done and the different documents prepared by the accused in this connection were false even on their own admissions.
The explanation furnished by the accused that they prepared false documents at the instance of Ghate and got work done thereafter was not accepted.
Objection was raised on behalf of the accused that the investigation of the case was illegal and that prosecution was barred by time under the pro visions of section 23 of the Land Improvement Schemes Act, 1942.
These objections were repelled.
The accused were accordingly convicted and sentenced as above.
On appeal the High Court affirmed the, findings of the learned special judge.
We have heard Mr. Kotwal on behalf of the, appellants and are of the opinion that there is no merit in the appeal.
It has not been disrupted before us that the accused made various entries and prepared documents on March 11, 1966 about their having got the rectification work done as well as about the payment of Rs. 369.07 on that account.
It has also not been disputed before us that the amount of Rs. 369 07 was not paid to any one by the accused in March or April 1966.
According to Ghate (PW 1) and Inamdar (PW 11), no work relating to the rectification of the Bundh was found to have been done till May 11, 1966 when they visited the site in question.
Inamdar 's evidence also shows that according to the measurement book prepared by the accused, 83 pits had been recently dug although the witness could not find a single pit on the spot.
In view of the above, we find no cogent ground to disagree with the trial court and the High Court that the accused had prepared false documents and had also committed criminal breach of trust in respect 515 of the amount of Rs. 369.07.
We also agree with the trial court and the High Court that the accused were in the discharge of their duties guilty of criminal misconduct as defined in section 5 of the Prevention of Corruption Act.
Mr. Kotwal has argued that the accused completed the recti fication work after May 11, 1966,.
There is, however, no direct evidence as may show that the, rectification work was completed ' after May 11, 1966.
Even if it may be assumed that the accused completed the rectification work in May 1966, that fact, in our opinion, would not absolve the accused of their criminal liability.
The charge, against the accused relates to preparation of false documents because even though no work had been done till March 11, 1966 and no amount had been disbursed, they prepared docu ments showing the doing of that work and the payment of that amount.
It is no answer to, that charge that after the matter had been reported to the higher authorities, the accused in the month of May 1966 got the rectification work done.
It is also no answer to a charge of criminal misappropriation that the money was subsequently, after the matter had been reported to the high authorities, disbursed for the purpose for which it had been entrusted.
According to explanation 1 to section 403 Indian Penal Code, a dishonest misappropriation for a time only is " misappropriation " within the meaning of that section.
Mr. Kotwal has also submitted that the accused expressed willingness to complete the work after the matter had been reported to the higher authorities.
This submission, 'even if accepted, would not exonerate the accused because the willingness after the matter had been reported to the higher authorities could not efface or undo the offence earlier committed by the accused.
Argument has then been advanced on behalf of the appellants that Sub Inspector Patil did not make investigation in the case in accordance with law.
It is urged that permission to make investigation was granted to Sub Inspector Patil on November 12, 1966 and, as such, he was not authorized to make before that date the enquiry which led to the registration of the case as that enquiry partook of the character of investigation.
Nothing has been brought to our notice as to how an enquiry before the registration of a case can be held to be investigation.
The matter, however, need not be dilated upon and it is not necessary to express any final opinion in the matter because we find that there is no material on the record as may show that the accused were prejudiced because of the alleged non compliance with the provisions of section 5A of the Prevention of Corruption Act.
It is well established that where cxognizance of a case has, in fact, been taken by the court on a police report following investigation 516 conducted in breach of provisions of section 5A of the Prevention of Corruption Act, the result of the trial cannot be set aside unless the illegality in the investigation can be shown to have brought about a miscarriage of justice.
The underlying reason for the above dictum is that an illegality committed in the course of investigation does not affect the competence and jurisdiction of the court to try the accused.
Where, therefore, the trial of the case has proceeded to termination, the invalidity of the proceeding investigation would not vitiate the conviction of the accused as a result of the trial unless the illegality in the investigation has caused prejudice to the accused (see H. N. Rishbud and Inder Singh vs The State of DelHi(1)].
Since there has been no miscarriage of justice in the present case because of the alleged non compliance with section 5A, the conviction of the accused appellants cannot be set aside on that score.
For the same reason, we are unable to accede to the contention of Mr. Kotwal that the conviction of the accused should be set aside because permission under section 5A of the Prevention of Corruption Act to SI Patil for investigation of the offence was granted in a ,casual manner and without the existence of sufficient reasons.
Lastly, it has been argued by Mr. Kotwal that the prosecution of the accused was barred by time under section 23 of the Bombay Land Improvement Schemes, Act, 1942.
The section reads as under "(1) No suit, prosecution or other legal proceeding shall be instituted against any public servant or person duly authorized under this Act in respect of anything in good faith done or intended to be done under this Act or the rules made thereunder.
(2)No suit or prosecution shall be instituted against any public servant or person duly authorized under this Act in respect of anything done or intended to be done, under this Act, unless the, suit or prosecution has been instituted within six months from the date of the act complained of.
" Sub section (1) of the section has plainly no application as it relates to anything done in good faith.
According to Bombay General Clauses Act, a thing shall be deemed to be done in good faith where it is in fact done honestly, whether it is done negligently or not.
The appellants admittedly were not acting honestly when they prepared the false documents in question and showed disbursement of Rs. 369.07 on March 11, 1966.
Mr. Kotwal, however, relies on sub section (2) of section 23 and (1) ; 517 submits that the prosecution could be instituted against the appellants only within six months from March 11, 1966.
As the charge sheet was submitted long after the expire of six months, the case against the accused appellants, according to the counsel, was barred by time.
This contention, in our opinion, is devoid of force.
Sub section (2) refers to suit or prosecution against a public servant or person duly authorized under the Act in respect of anything done or intended to be done under the Bombay Land Improvement Schemes Act.
It cannot be said that the acts of the accused appellants in preparing false documents and in committing criminal breach of trust in respect of the amount of Rs. 369 07 as also their act of criminal misconduct were done under the Bombay Land Improvement Schemes Act.
Sub section (2) of section 23 deals with anything done or intended to be done under the above mentioned Act by a public servant or a person duly authorized under the Act.
It has no application where something is done not under the Act even though it has been done by a public servant who has been entrusted with duties of carrying out improvement schemes under the above mentioned Act.
The impugned acts of the appellants in the present case were not in discharge of their duties under the above mentioned Act but in obvious breach and flagrant disregard of their duties.
Not only they did no rectification work for the Bundh which was a part of the improvement scheme, they also misappropriated the amount which had been entrusted to them for the purpose of rectification.
Prayer has also been made for the reduction of the sentence, but we see no cogent ground to interfere with the same.
The appeal consequently fails and is dismissed.
K.B.N. Appeal dismissed.
[/INST]The lessee of a plot of land from Government sub leased it and the sub lessee built a building on it consisting of Rats, shops and offices.
The sub lessee assigned the rights of occupation of those flats etc.
under various .agreements.
Thereafter, the appellant company was incorporated and the sub lessee purported to assign all his rights in the building to the appellant company.
In the preamble to the deed it was recited that the company had been formed for the better administration of the building and for the protection of the interests of the persons occupying the flats etc., and that ;the sub lessee had agreed to assign to the appellant company all his interests in the, land and the building.
The consideration, mentioned in the document was nil and the document bore a stamp% of 12 annas.
When it was presented for registration, the authority impounded the deed, held that the appellant company was formed of and for the persons who had purchased the flats etc., that the real consideration for the assignment was .made up partly of what was paid by the occupiers of the flats etc., and determined the stamp duty and penalty under section 40 of the Stamp Act, 1899.
On a reference to the High Court it was held, that the article in the ,Schedule to the St amp Act applicable is article 23.
On the question of consideration, 'however, while one Judge held that the consideration was ,nil ' as mentioned in the deed, the majority held that the Revenue was not bound to accept the quantum of consideration mentioned in the deed, that the deed incorporated into itself the various agreements entered into between the sub lessee and the persons to whom rights were assigned in the flats etc., and that the consideration was the total amount payable to the sub lessee by those assignees.
Allowing the appeal to this Court, HELD: (1) Before the terms and conditions of an agreement can be said to have been incorporated into another document, it must be shown that the parties intended to do so.
In the present case, the mere reference to the earlier transactions in the deed did not amount to an incorporation in it of the terms and conditions of those transactions.
[338 F H] (2) In view of section 27 of the Stamp Act the parties to a document are required to set forth in the document fully and truly, the consideration (if any) and all other facts and circumstances affecting the chargeability of that document with duty.
But a failure to do so is merely punishable under section 64 of the Stamp Act.
There is no provision empowering the Revenue authorities to make an independent inquiry of the value of the property conveyed for determining the duty, even assuming that the charging words in article 23 do not mean that the Revenue must have regard 333 only to what the parties to the instrument have elected to state the consideration to be, but can assess the duty upon the value of the consideration as disclosed upon an examination of the terms of the instrument as a whole.
[339 A D] (3) There is a long line of decisions of the High Courts holding that the Legislature had not empowered the Revenue to make an independent inquiry as regards the valuation of the right sought to be assigned.
That view is correct and the question must also be held to be settled by state decision.
[340 D F] Ramen Chetty vs Mohomed Ghouse, I.L.R. , Sakharam Shankar vs Ramchandra Babu Mohire, I.L.R. , Muhammad Muzaffar Ali, In re.
I.L.R. 44 All.
339, Sri Sitaram Ramalla & Anr.
vs State of Bihar, I.L.R. 39 Pat.
228 and Bharpet Mohammad Hussain Sahib & Anr.
vs District Registrar, Kurnool, I.L.R. , approved.
(4) In any event, there was no basis for holding that the consideration for the deed was the amount received by the sub lessee from the persons to whom he assigned rights in the flats etc.
Those persons acquired an independent right and title whether perfect or not en before the impounded deed was executed, and their rights did not flow from the impounded deed.
[340 F G]
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<s>[INST] Summarize the judgementCivil Appeal No. 2891 of 1984.
From the Judgment and Order dated 28.2.84 of the Customs Excise and Gold Control Appellate Tribunal, New Delhi in Order No. 118/84 D. A.K. Ganguli, P. Parmeswaran and K. Swamy for the Appellant.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI,J.
This is a statutory appeal under Section 35 L(b) of the Central Excise & Salt Act, 1944, hereinafter called the 'Act ', against the Order dated February 22, 1944 passed by the Customs, Excise & Gold (Control) Appellate Tribunal, hereinafter called the 'CEGAT ' In this appeal we are concerned with the question whether there was exigibility to taxation on the item concerned under the Act.
It appears that during the course of investigations made against Swastik Investment Company, Bombay, the Central Excise Officers found that some of the consignments of the material described in the documents as 'crimpled uncut waste ' were cleared from M/s. Swadeshi Polytex Ltd., Ghaziabad, during the period from Jan '74 to Dec '77 and were purchased by the respondents herein and utilised in the manufacture of polyester staple fibre.
The Collector held that the so called 'crimpled uncut waste ' purchased by the respondents was, in fact, polyester fibre tow and the staple fibre which were commercially two distinct products and the respondents had carried on manufacture of polyester staple fibre from tow and, as such, exigible to duty.
The respondents filed an appeal before the Central Board of Excise & Customs against the Collector 's Order.
The appeal was thereafter transferred to CEGAT in pursuance of Section 35 P of the Act.
It appears that there is distinction between a tow and staple fibre.
The Ministry of Finance (Deptt. of Revenue) 's circular indicates as follows: "Tow is a collection of many parallel continuous filaments without twist which are grouped together in rope like form." "Tow is used for the same purpose for which staple fibre is 1009 used.
Tow is mainly converted into staple fibre and only a negligible quantity is converted directly into yarn.
It has been therefore decided that duty should be levied on Tow at the rate applicable to staple fibre (MF (DR & I) F. No. 50/7/71 CX 2 dt.
22.12.72)".
In other words, Tow is fibre in running length and staple fibre is obtained by cutting it into required short length.
On an examination of the material and the contention, the Tribunal came to the conclusion that the material which the respondents had purchased was already man made fibre but in running length.
All that the respondents did in relation to it, was to cut it into staple length after some manual sorting and straightening.
The question, therefore, is whether cutting the long fibre into short fibre resulted into a new and different articles of commerce.
Now it is well settled how to determine whether there was manufacture or not.
This Court held in the case of Union of India vs Delhi Cloth & General Mills, ; that 'manufacture ' means to bring into existence a new substance and does not mean merely to produce some change in a substance (emphasis supplied).
It is true that etymological word 'manufacture ' properly construed would doubtless cover the transformation but the question is whether that transformation brings about fundamental change, a new substance is brought into existence or a new different article having distinctive name, character or use results from a particular process or a particular activity.
The taxable event under the Excise Law is 'manufacture '.
See in this connection Empire Industries Ltd. & Ors. etc.
vs Union of India & Ors. etc.
, [1985] Suppl.
1 SCR page 292 and M/s Ujagar Prints vs Union of India, In the instant case it is not disputed that what the appellant did, was to cut the running length fibre (tow) into short length fibre (staple fibre).
It indubitably brought a change in the substance but did not bring into existence a new substance.
The character and use of the substance (man made fibre) remained the same.
It is true that by the change in the length of the fibre, it acquired a new name.
But since in this case the tariff entry recognised the single description 'man made fibre ' with no further sub division based on length of the fibre and even without any distinct enumeration of the various forms of fibre by cutting long fibres into short ones, the respondents did not bring into existence any new product so as to attract any levy under the same tariff entry.
Even by cutting, the respondents obtained man made fibre.
Such cutting, therefore, involved no manufacture and, hence, no duty liability can be imposed upon them.
1010 In that view of the matter and on the facts found by the Tribunal, we are of the opinion that the Tribunal was right in the view it took and that decision needs no interference.
This appeal, therefore, cannot be entertained and is accordingly dismissed.
N.V.K. Appeal dismissed.
[/INST]% The Central Excise Officers during the course of investigations made against M/s Swastik Investment Company, Bombay found that some of the consignments of the material described in documents as 'crimpled uncut waste ' were cleared from M/s Swadeshi Polytex Limited, Ghaziabad during the period from January, 1974 to December, 1977, were purchased by the respondents and utilised by them in the manufacture of 'polyester staple fibre '.
The Collector held that the 'crimpled uncut waste ' purchased by the respondents was in fact 'polyester fibre tow ' and that the respondents had carried on manufacture of 'polyester staple fibre ' from tow and, as such, exigible to duty.
Aggrieved by the Collector 's Order the respondents filed an appeal before the Central Board of Excise and Customs.
This appeal was transferred to the Customs Excise and Gold Control Appellate Tribunal in pursuance of section 35 P of the .
The Tribunal on an examination of the material and the contentions came to the conclusion that what the respondents had purchased was already man made fibre but in running length, and that what they did in relation to it, was to cut it into staple length after some manual sorting and straightening and held that such cutting involved no 1007 manufacture and hence no duty liability could be imposed.
In the Appeal by the revenue to this Court on the question: whether there was exigibility to taxation on the item manufactured by the respondent.
Dismissing the Appeal.
^ HELD: 1.
There is a distinction between 'tow ' and 'staple fibre '.
'Tow ' 'is fibre in running length and 'staple fibre ' is obtained by cutting it into required short length.
[1009B] 2.
The taxable event under the Excise Law is 'manufacture '. 'Manufacture ' means to bring into existence a new substance and does not mean merely to produce some change in a substance.
[1009D] 3.
Etymologically the word 'manufacture ' properly construed would doubtless cover transformation, but the question is whether the transformation in the instant case brings about fundamental change, a new substance is brought into existence, or a new different article having distinctive name, character or use results from a particular process or a particular activity.
[1009D E] In the instant case, it is not disputed that what the respondents did, was to cut the running length fibre (tow) into short length fibre (staple fibre).
It indubitably brought a change in the substance but did not bring into existence a new substance.
The character and use of the substance (man made fibre) remained the same.
By the change in the length of the fibre, the substance acquired a new name.
But since the tariff entry recognised the single description 'man made fibre ' with no further sub division based on length of fibre and even without any distinct enumeration of the various forms of fibre by cutting long fibres into short ones, the respondents did not bring into existence any new product so as to attract any levy under the same tariff entry.
Even by cutting, the respondents obtained man made fibre.
Such cutting, therefore, involved no manufacture and, hence, no duty liability can be imposed upon them.
[1009E H] Union of India vs Delhi Cloth & General Mills, ; ; Empire Industries Ltd. & Ors. etc.
vs Union of India & Ors. etc.
, [1985] Suppl.
1 SCR page 292 and M/s Ujagar Prints vs Union of India, , referred to. 1008
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<s>[INST] Summarize the judgement: Criminal Appeal No. 310 of 1971.
(Appeal by Special Leave from the Judgment and Order dated 23 4 1971 of the Allahabad High Court in Criminal Appeal No. 168/ 69 with Criminal Appln.
No. 986/69).
Frank Anthony and U.P. Singh, for the Appellant.
O.P. Rana, for the Respondent.
The Judgment of the Court was delivered by KRISHNA IYER, J.
Some exceptions disprove the rule.
Cases are legion where the proverbial proposition of litiga tive finality at the High Court level on findings of fact has been affirmed by this Court, but the exceptions which prove the.
rule are also weB established.
We must at the outset state that this case does not fit into the conventional legal mould but, nevertheless, pos sesses such strange features that our 'ultimate ' power may legitimately come into play.
690 A petty store keeper cum cashier in a rural block devel opment office (in the district of Shahjehanpur) was charged.
with misappropriation of several sums adding up to a little over Rs. 5,000/ .
The charges having been denied and the real culprit having been pointed out as the boss of the block development office, the Sessions Court received evi dence on both sides, found the testimony of the Block Development Officer (BDO, acronymically) 'completely false and unbelievable ' in regard to many of the items of embez zlement and made critical observations about his culpability in respect of many of the malversations.
We may have something to say.
about the not unusual phenomenon of the 'small fry getting caught, and the big shark breaking through the net ' in economic offences where public money is handled by public servants.
For the nonce we may content ourselves with the statement that the little official in his twenties which the accused was was acquitted of all but one charge and the misappropriation of Rs. 5,194.82 dwindled into a solitary fugitive item of Rs. 50/ for which he was punished with imprisonment for one year a fine of Rs. 300/ .
The conviction was confirmed but the sentence was reduced by the High Court.
The aggrieved appellant urges before us that the soli tary surviving item of misappropriation held proved concur rently, had, in fact, been vitiated in the process by funda mental flaws.
We will proceed briefly to narrate the epi sode and examine the tenability of the extraordinary fea tures leading to the exculpatory sequel.
The agrestic immensity of Indian backwardness is sought to be banished by developmental activities through block level infrastructures.
Jaitipur Block is one such and it has a nucleus of small officials and some rural development assistants, the hegemony being vested in the BDO.
The dramaris personae here are the accused, the stock clerk cure cashier, the BDO (PW 8) and the Panchayat Secretary (PW 7) whose magnificent salary is Rs. 50/ per mensem.
The prosecution narrative runs long but can be short if we abandon the plurality of charges and limit the facts to.
the single item of Rs. 50/ .
In skeletal brevity, there was a,Block Office in Jaitipur where a small staff worked on low salaries to stimulate rural development.
The accused was cashier and used to be entrusted in such capaci ty with sums, large and small.
The case, as originally projected, was that Rs. 5,194.82 was committed to his custo dy and the whole sum was siphoned off into his own pocket by various acts of criminal breach of trust.
Admittedly it was the duty of the accused cashier to maintain the cash book and deal with the monies.
Equally clear is the fact that the head of the office, the BDO, was duty bound 'to tally and check the dally entries of the cash book with the rele vant vouchers, to affix his signature. after 'checking the total at the end of the day '.
The block office has, on its rolls, Panchayat Secre taries drawing small salaries.
One of them is PW 7, on a monthly pay of Rs. 50/ .
Another unfortunate feature of these.
offices, as disclosed in the evidence, is that even these petty emoluments are paid irregularly pro 691 ducing both discontent and inclination for manipulation.
That public offices should be so run is not too complimen tary.
Anyway, PW 7 received his pay for December 1964 on February 22, 1965 and his pay for the later month of January 1965 he drew a few days earlier on February 15, 1965 (vide Exhibits Ka 26 and Ka 29).
These oddities in disburse ments led to the plausible plea by Asiam, the accused, that P.W. 7 not having received his pittance for the month of December 1964 even after January had come and gone, pleaded his dire need for money and received Rs. 50/ as pay for the month of January 1965 and signed a separated voucher bearing that date, viz., February I, 1965.
It is conceivable that a little man with a little pay packet, which is tantalizing ly postponed, pressurizes the cashier to pay him the small sum signing a voucher and it need not surprise us if the cashier gives in to compassion and makes the payment.
This is precisely the case of the accused.
To shore up this plea, he points out a regular entry in the cash register against the date February 1, 1965 of a payment of Rs. 50/ as salary for the month of January 1965 to P.W. 7.
Rein forcement is received from the further fact that this spe cific entry of payment the falsification of which is the foundation.
for the charge of misappropriation of Rs. 50/ is ticked and 'initialled by the BDO P.W. 8.
We have earlier referred to the practice and the obligation of this officer to tally and check the daily entries in the cash book with the relevant vouchers and then to affix the signature after checking the total at the end of, day.
Moreover he had the special responsibility, as the most responsible officer on the staff on his own showing, 'to keep the cash balance found at the end of every day in the cash chest register '.
He does not do daily physical verification of the cash but does it on a monthly basis and he keeps the key of the same, although another key is left with the cashier.
The accused 's contention that he paid the salary of Rs. 50/ to P.W. 7 on February 1, 1965 supported though it is by an entry in the Books duly initialled by the BDO presuma bly after verification with the corresponding voucher has been rejected by the Courts without advertence to these spinal circumstances by the superficial plea that P.W. 7 is seen to have been paid the salary for December 1964 on February 22, 1965 with a regular entry and a stamped voucher.
P.W. 7, when examined, denied the earlier payment on February 1, with a touch of dubious candour and owned up the payment for December supported by the stamped voucher on February 22, 1965.
A streak of mystique generates doubt in P.W. 7 's testimony because in cross examination he says: '1 do not remember as such that along with other officials the cashier would have given me the salary for the month of January 1965 for two times by mistake '.
In the next breath he corrects himself to say that he had not been paid twice.
On the strength of these materials a conviction of guilt has been rendered by both the Courts and.
be the appreciation right or wrong, we, as the final court should have held back ordinarily from temptation for reappraisal, vehement argu ment notwithstanding.
But certain grave factors, condu cive to miscarriage of justice have bulked forward to induce us to make an exception, which we will presently expatiate 692 There were nine items of misappropriation originally imputed to the accused.
All, but one, remained unproven and the guilt is now fixed on one of the inconsiderable items.
Not that the littlest sum of public money can be taken on privately with impunity but that the perspective is coloured somewhat by the substantial failure of the prosecution to make out its case regarding all the major items.
More disquieting is the fact that the Single surviving charge stands or falls on the veracity or unveracity of a solitary witness appreciated in the light of the conspectus of circumstances.
What are those circumstances ? The BDO, charged as he is with serious responsibilities including guardant functions over the finances of the institution, has sworn that he checks the daily entries in the cash book with the relevant vouchers and affixes his signature, checks the total at the end of the day and again affixes his signature.
It is a pregnant piece of evidence that there is a specific entry on February 1, 1965 in the cash book that a payment of Rs. 50/ by way of salary to P.W. 7 has been made.
The BDO has signed against the entry which means, in the ordinary course, he has verified the payment with reference to the relevant voucher.
If this be a fact, the accused has proba bly paid the salary, made the necessary entry, shown it together with the relevant, voucher to the BDO, got his signature, totalled up the figures correctly and secured the BDO 's signature over again.
The exculpatory impact of this testimony is sufficient, according to ordinary canons of criminal jurisprudence to relieve the accused of culpa bility since reasonable doubt is generated.
The sensi ble scepticism about guilt which springs from the BDO 's signature against the relevant entry is heightened by the fact that the Finance Handbook referred to by the High Court in its judgment states that it is the duty of the drawing and disbursing officer to check each and every entry of receipt and expenditure recorded in the cash book and peri odically to check physically the cash balances.
The BDO, according to the High Court, has made evasive statements to suppress certain facts and 'spoken some apparent ties '.
Startlingly enough, the Sessions Court has recorded P.W. 8, the BDO, as false and unbelievable in regard to certain other charges and gone to the further extent of concluding that four entries figuring as charges against the accused had been really made to the BDO himself 'who probably embezzled these amounts '.
The consequential acquittal of the accused on these four charges has not been disturbed.
In sum, therefore, the conclusion is irresistible that the BDO, the top officer in full financial control, had behaved irresponsibly or delinquently with regard to the funds of the block office, had been described as too mendacious to be depended and had convicted himself, of gross neglect of public duty in regard to the checking of the cash register, out of his own mouth.
If we are to attach there is no reason for a Court not to do so weight to the contemperane ous entry in the cash register coupled with the signature of the BDO the same day, as against his ipse dixit later, the accused is entitled to the benefit of reasona ble doubt.
There is likely to have been a separate voucher evidencing the payment of Rs. 50/ which is the subject of the defalcation because the BDO is not likely to have at tested the entry of that payment without checking it up with the corresponding receipt.
693 Two circumstances fall to be mentioned before the probative balance sheet can be struck.
The entry of Rs. 50/ on February 1, 1965 is seen scored off.
Who did it ? Can we guess in the dark ? Nothing on record suggests that the accused alone could have done it There is much credibil ity in the theory that with the connivance of the BDO and the clerks petty sums are quietly abstracted from the public exchequer, make believe entries are made and attest ing signatures appended by the BDO and, if the peril of detection by higher officers is apprehended, scorings, additions, alterations and the like are made.
It is common case that in the cash register there are many such cross ings, cuttings, scorings and like tamperings.
Many scape graces were perhaps party to these processes but one scape goat cannot, for that reason, get convicted in the criminal court.
In this context it is pertinent to remember that the District Accountant, after a fuller examination of the books of the block offices, has stated that the several embezzle ments have been facilitated by the laxity of the BDO who should be directed to make good the loss.
A further recom mendation by him to proceed departmentally as against the BDO and as against the Cashier is also found in the report.
Whether action had been taken against the BDO, the State 's counsel was not able to tell us.
The sole lip service to the criminality imputed is lent by PW 7.
Did he receive his salary of Rs. 50/ twice over ? Undoubtedly he was interested in denying it.
Doubt hardly exists of the fact that he got his small December salary of Rs. 50/ only in February next.
Far more likely that in such a situation he would have pressed for the payment of Rs. 50/ to be adjusted later.
Likewise, his initial ambi guity in plainly denying that he had been paid twice en hances this suspicion.
When the cash affairs of the office is in a mess, when the Chief is guilty of dereliction, when the clerks are receiving petty salaries at irregular intervals, the somewhat tainted testimony of PW 7 is fax too slender a string to hang the guilt upon, pitted as it is against the cash register entry by the BDO, apparently after consulting the payment voucher.
The accused was suspended promptly and therefore this voucher, if it did exist, must have been in the office and its non production in court is not a matter for drawing an inference against the ac cused.
We have made this unusual probative survey of the evi dence for the sole reason that the bona fides of the prose cution, leaving off bigger and going at the smaller, mixing false testimony with true seriously suspect and holding on to the conviction of the accused on no evidence, which a reasonable person reasonably instructed in the law will rely upon, is neither just nor legal.
The accused, at the time of the offence, was in his early twenties probably a neophyte or new entrant into a little racket.
Doubts there are about his complicity but that a man may be guilty is different from saying that he must be guilty.
The dividing line between the two is 694 sometimes fine, but always real.
There is undoubtedly collective.
guilt in the conjoint delinquency in the running of the block development office.
Public affairs and public funds, especially on the developmental front, require far more integrity, orderliness, activism and financial pru dence.
Its absence we regret, but the specific guilt of the particular accused not having been proved, as mandated by the law, results in his acquittal.
We accordingly allow the appeal.
The guilt finding function is over, but judges have accountability to the country to the extent matters falling within their professional examination deserve sounding the tocsin.
With this alibi we make a few observations.
The popular art of helping oneself to public money, in little bits or large slices, is an official pathology whose pernicious spell has proliferated with the considerable expansion in institutions of public welfare and expenditure for rural development.
From Kautilya 's Arthashastra to Gunnar Myrdal 's Asian Drama, the vice is writ large and the demoralising kink in the projects for criminal prosecution to eradicate these vices in public offices is that more often than not the bigger engineer of these anti social schemes figures as prosecuting witness and the smaller men in the package deal are put up as sacrificial goats.
The head escapes, the hand is chased down and, when the Court convicts, cynicism, instead of censure, is the unintended public response.
In a social system of the high and low, where the wheels of punitive processes are steered by the former, laws equal in the face quirk unequal at heart.
Crack down Crime Control itself takes its alignment from the social philosophy of the agencies of public power.
The present ease is a small symptom of a spread out disease and the State, in its highest echelons, determined to down this rocket of economic offences must launch massive, quick acting, broad spectrum prosecutorial remedies, regardless of personal positions, and leisurely procedural apparatuses, if high social dividends are to be drawn.
The mystique of ,making the dubious officer the veracity vendor in the witness box and the collaborating minion the dock dweller, is suspected as intrigue to Shelter the upper berth culprit.
Caesar 's wife, where public interest is at stake, must be above suspicion, if prosecutorial credibility is to be popular purchase.
If the nation, poised for socialism, must zero in on public office offences, what we have observed must not and surely, will not slumber as obiter sermons but serve as catalysts to crash strategies on white collar crimes.
In a developing country of scarce resources, husbanding public funds has a special onerousness.
Gross negligence, even absent mens rea, in handling the nation 's assets by those in office must be visited with criminal liability as it in flicts double injury on that voiceless, faceless, woe stricken have not community which is aplenty.
Public power, under the penal Law, must be saddled with 695 higher degree of care, if Indian jurisdiction is to fulfil its social mission through developmental legislation.
Had such a law existed, many superior officers routinely signing away huge sums or large contracts could have been alterted into better standards by potential penal consequence.
The present case is an instance in point and our parliamen tarians we hope, will harken.
M.R. Appeal allowed.
[/INST]The appellant, a cashier in a rural block development office of Shahjahanpur district, was convicted for misappro priating public money.
Both the courts concurrently found that he had pocketed the sum which he claimed to have paid the Panchayat Secretary as salary.
The appellant contended that the charge against him was falsified by the voucher and regular entry of the cash register regarding the above payment, which had been ticked and initialled by the Block Development Officer, and pro duced in evidence.
Allowing the appeal, the Court HELD: (1) The proposition of litigative finality at the High Court level on findings of fact has been affirmed by this Court, but the exceptions which prove the rule are also well established.
A conviction of guilt has been rendered by both the Courts, but certain grave factors conducive to miscarriage of justice, induce us to make an exception.
The accused is entitled to the benefit of reasonable doubt owing to the contemporaneous entry in the cash register coupled with the signature of the B.D.O. the same day, as against ipsi dixit later.
[689 G, 691 H, 692 G H] (2) Our observations must serve as catalysts to crash strategies on white collar crimes.
Gross negligence, even absent mens rea, in handling public funds by those in office must hold penal consequences as it inflicts double injury on the poor masses.
[694 G H]
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<s>[INST] Summarize the judgementAppeals Nos. 104 to 107 of 1961.
Appeals from the judgment and order dated July 5, 1956, of the Madras High Court in Appeal against order No. 480, 454, 478 and 479 of 1954 respectively.
A.V. Viswanatha Sastri and R. Gopalakrishnan, for the appellant.
K.N. Rajagopal Sastri and M. section Narasimhan, for respondent No. 1. 1963.
March 7.
The judgment of the Court was delivered by MUDHOLKAR J.
This appeal and civil appeals Nos. 104, 106 and 107 of 1961 arise out of execution proceedings in four different suits but as they involve a common question they were heard together by the High Court and by us.
That ques tion is whether the execution applications out of which these appeals arise are within time.
We propose to treat C. A. No. 105 of 1961 as a typical case.
The relevant facts thereof are briefly these : In O. section 46 of 1943 one Ramanathan Chettiar instituted a suit against one Venkatachalam Chettiar in the court of the Subordinate Judge of Devakottai, for the recovery of a sum of Rs. 10,285/ due on promisory note dated November 20, 1942 with interest thereon.
He eventually obtained a decree for the full claim.
In so far as the second defendant 244 is concerned, he was made liable for the decrctal amount to the extent of this interest in the joint family property of himself and his father.
The plaintiff assigned the decree in favour of Chidambaram Chettiar, who is the appellant in C. A. 105 of 1961.
He filed an execution application but the execution proceedings commenced by him proved infructuous because the first defendant was adjudicated an insolvent on February 27, 1945.
On September 9, 1946 a composition of the debts due from the insolvent and his son, the second defendant.
was arrived at.
To the deed of composition the second defendant was also a party though he was not adjudicated an insolvent.
Under that deed the creditors, including the four appellants before us, agreed to take 40% of the dues, except one creditor who was to be paid a little more.
The defendants, it may be mentioned, bad extensive money lending business in Burma and the bulk of their property was situate in that country.
Under the composition arrangement the entire property of the defendants, both in India and in Burma was to vest in four trustees, one of whom was the insolvent, that is, the first defendant to the suit.
Two of the trustees were the present appellants, Chidambaram Chettiar and Krishnappa Chettiar, appellant in C. A. 104 of 1961.
The fourth trustee was an outsider.
The total indebtedness of the defendants, as ascertained on the date on which the composition was effected, was Rs. 2,16,077/4/8/ but it was reduced under the arrangement to Rs. 86,430 13 3.
There are four schedules to the composition deed.
Schedule A sets out the names of the creditors and the amounts due to them, Schedule B sets out the properties of the defendants and Schedules C and D set out the properties at Leiwo and Meola respectively in Burma.
The deed provides for the payment of the reduced amount by the trustees to different creditors from the income of the properties or by sale, or mortgage of those properties within four 245 years from April 14, 1947.
The deed further provides for the extension of this time limit "according to exigencies and necessity at the discretion of the first two trustees" i.e., the first defendant and the appellant Chidambaram Chettiar.
The arrangement also provides for payment of interest at 5 annas per mensem in respect of the amounts due on the decrees and 4 annas per mensem in respect of other outstandings as from April 14, 1947.
The composition contemplated the realisation of the dues of the creditors from the income or sale or mortgage of the Burma property, in the first instance.
Clause to which deals with this matter runs as follow "In case the properties of Burma firm are not sufficient to pay the amounts set apart as payable to the creditors at 40 per cent the individuals Nos. 1 and 2 Trustees shall sell the properties in British India and set out in the B schedule herein and from out of the sale proceeds distribute the amount to the creditors.
Similarly, after the 40 per cent amounts have been paid and if there should be any amount of deficiency for the payment of the 60 per cent amount payable to Krishnappa Chettiar as described in para 6 supra, even for that also, the individual Nos. 1 and 2 Trustees shall sell the aforesaid British India properties and pay the aforesaid Krishnappa Chettiar the entire balance amount.
" The composition deed contains various other terms out of which it would be relevant to set out only the following two : "Clause 8 : Until 40 per cent of the amount is paid to the creditors as aforesaid, the said Trustees, shall at the time of disbursement of the dividend, pay from the 1st Chitirai of the year Sarvajith for the annual expenses of the 246 family, a sum of Rs. 600 per annum to indivi dual No. 4 Trustees Venkatachalam Chettiar and a sum of Rs. 300 per annum to his son Nachiappa Chettiar for the aforesaid expenses.
Clause 16 : After the annulment of the order of adjudication herein, the aforesaid Venkata chalam Chettiar shall, in respect of transfer etc., of management of the properties mentioned in C and D schedules, execute a general power of attorney in the favour of individual Nos. 1 and 2 trustees and have the same registered.
" The composition scheme was accepted by the insolvency Court and the adjudication of the first defendant as insolvent was annulled by the court on December 19, 1946.
Due to political changes in Burma only very little was realised out of the Burma assets within the period of four years prescribed in the composition deed.
The trustees who were empowered to extend the time did not extend it.
The appellants, therefore, turned to the Indian assets and sought execution of their decrees against them.
Two contentions were raised on behalf of the defendants.
One was that the Indian assets could not be sold until the assets in Burma were completely exhausted and the other was that the execution applications were barred by time.
In O. section No. 46 of 1943 the last execution application was dismissed on September 19, 1946 (E. P. No. 109 of 1946).
No execution petition was filed thereafter till the present petition (E. P. No. 117 of 1952).
This was filed on June 13, 1952.
Similarly in the remaining three appeals also execu.
tion applications with which we are concerned were filed more than three years after the dismissal of the previous execution applications.
It may be mentioned that originally the appellant as well as appellants in the other appeals had sought the execution of their 247 respective decrees for the fall amount.
But they amended their petitions later on pursuant to the orders of the court and restricted their claims to 40 per cent of the amounts due under their decrees.
The appellant Chidambaram filed an affidavit along with the execution petition and set out the following grounds in support of his contention that the execution application was within time.
"The trustees were able to realise some of the assets of the defendants in Burma and to pay a dividend of 10 per cent to the creditors.
I was paid a sum of Rs. 562 4 0 by way of dividend for this decree on August 10, 1949.
As the rest of the Burma assets of the defendant could not be realised by the trustees on account of the civil war in Burma and the land legislations passed there and as there was no prospect of their being realised in the near future myself and A. section K. Krishnappa Chettiar aforesaid as managing trustees under the said composition offered to extend the period of management by one year provided the defendants would consent to their Indian assets being realised and distributed among the creditors.
But the defendants were not willing thereto and hence we thought fit to extend the period of our management.
We have filed a petition in I. A. No. 87 of 1951 in the suit I. P. No. 1 of 1945 to have the said composition scheme set aside and the 1st defendant re adjudged as insolvent.
The said petition is pending.
I am advised that as the said composition arrangement has failed on account of the assets of the defendants not being realised and the debts discharged within the four year period mentioned therein I am in law and in equity entitled to recover the entire amount due to me under this decree by executing it.
248 8.
The said composition provides for a maintenance allowance of Rs. 600 and Rs. 30 annually being given to the 1st and 2nd defendant respectively at the time of distribution of the dividends.
In respect thereof a notice was issued by the 2nd defendant on April 19, 1949 to myself and A. section K. Krishnappa Chettiar aforesaid wherein there is an acknowledgment of liability in respect of the several debts mentioned in the said composition.
Further the trustees have, acting under the authority given to them by the defendants under the said composition, paid me Rs. 562 4 0 on August 10, 1949 by way of dividend for this decree and have duly entered the same in the accounts maintained by them.
Moreover I could not execute the decree during the four years from April 14, 1947 or any extended period during which the trustees had to manage, realise and distribute the assets of the defendants.
There is therefore no question of limitation.".
Similar grounds were set out in the affidavits filed by the other appellants also.
It may be mentioned that in each of the excution applications relief was claimed only against the second defendant because in insolvency petition No. 87 of 1951 filed by some of the creditors the first defendant, was readjudicated an insolvent by the court on August 3, 1954.
The execution application was, as already stated, opposed by the second defendant firstly on the ground that the composi tion arrived at between him and his father on the one hand and the creditors on the other was still in force, that the arrangement was irrevocable and operated as a complete discharge of the liability of the defendants for all time.
The second ground was that the execution application was barred by time.
249 The precise pleas of the second defendant regarding limitation were as follows : (a) that the adjudication of his father as an insolvent and the pendency of insolvency proceedings against him would not affect limitation in so far as he was concerned; (b) that the receipt by the appellant and other creditors of certain amounts as dividends in August, 1949 would not extend the period of limitation for execution proceedings; (c) that the acknowledgment relied upon is " 'wholly wrong, misconceived and untenable.
" According to him there was no acknowledgement of liability of any kind in the notice referred to in the affidavit much less the liability of the second defendant to discharge the decree which had in fact become extinguished and effaced by reason of the composition arrived at on September 9, 1946.
In the course of the arguments before the executing court it was urged on behalf of the appellants in those appeals that the four years within which the trustees were required to realise the Burma properties and pay off the debts of the creditors must be regarded as a period during which the execution of the decrees was stayed and that consequently on the principles underlying section 15 of the Indian Limitation Act, 1908, that period should be deducted from computing the period of limitation for preferring execution applications.
The Subordinate judge, before whom the execution applica tions were filed, upheld this contention and held that the execution applications were within time.
He also held that the execution applications arrived at between the parties operated as an adjustment 250 of the decree on the date on which that composition was effected or from the date on which the adjudication was arrived at and that though the composition could not be certified to the executing court under 0.
XXI, r. 2, C. P. C. within the time permitted by law, it could be certified even now at the instance of the decree holder because it was open to the decree holder to certify an adjustment at any time he liked.
According to the learned Subordinate judge, the adjustment precluded each of the appellants from ex cuting his decree for a period of four years from April 14, 1947 and, therefore, the execution applications were within time.
The High Court, however, disagreed with the Subordinate judge on both the grounds and holding that the execution petitions were barred by time allowed the appeals.
It may be mentioned that neither of the two courts below has considered the contention of the appellants in these appeals that the letter dated April 19, 1949 sent by the second defendant to two of the trustees operated as an acknowledgment of their liability or that dividends paid to the appellants by the trustees in August, 1949 operated to extend the time of limitation.
Mr. Viswanatha Sastri, who appears for the appellants in these appeals, has raised only two contentions.
The first is that the principle underlying section 15 (1) of the Limitation Act is applicable to a case of this kind and that, therefore, the execution applications are within time.
The second is that at any rate the letter dated April 19, 1949, written by the second defendant to the trustees operates as an acknowledgment of liability under section 19 of the Limitation Act and, therefore, saves the limitation in respect of all the execution applications except the one out of which C. A. No. 104 of 1961 arises.
According to Mr. Sastri the composition of a decretal debt does not amount to an adjustment or satisfaction of a decree until the acts required to be 251 done thereunder have been performed.
Here the composition scheme required payment of 40 per cent of the decretal debts by the trustees to the craditors.
According to him, until that condition was fulfilled the original decree cannot be said to have been satisfied.
Since the decrees herein involved could not be regarded as having been satisfied they are still alive.
Then, according to Mr. Sastri, where a composition scheme prescribes the period during which a condition has to be performed, till the expiry of theperiod or performance of the condition the operationof the decrees must be deemed to have been stayed.
For, during this period it would be incompetent to the decree holders to execute their decrees.
Such period could therefore be deducted by applying the principles underlying section 15 (1) of the Limitation Act from computing the period of limitation for filing a fresh execution application.
He concedes that here the composition scheme not having been certified to the execution court, the defendants would not have been able to resist an execution application if made within the period of four years specified in the deed of composition.
But the composition being binding on the appellants, they would have laid themselves open to suits for damages at the instance of the defendants if they had proceeded to execute their decrees within this period.
Section 15 (1) of the Limitation Act runs thus : "15 (1) : In computing the period of limi tation prescribed for any suit or application for the execution of a decree, the institution or execution of which has been stayed by injunction or order, the time of the continuance of the injunction or order, the day on which it was issued or made, and the day on which it was withdrawn, shall be excluded.
" It is clear from its terms that it is restricted in its application to a case where the execution of a decree 252 has been stayed by an injunction or an order.
By no stretch of imagination can it be said that the acceptance by the insolvency court of the composition operated as a stay of execution of the decrees for the period of four years referred to in the deed or as an injunction.
Further, the second defendant was not a party to the insolvency proceedings and could, therefore, not have been entitled to the benefit of the order of the court accepting the scheme of composition.
In support of his contention that the principles underlying section 15 (1) are applicable to a case like the present one, Mr. Sastri has strongly relied on the decision in Govindnaik Gurunathnaik vs Basauannawa Parutappa (1).
There, Beaumont C. J., has observed at P. 437 : "Section 15 of the Act recognizes the princi ple that in computing the period of limitation prescribed for an application for the execution of a decree, any period during which the execution of the decree has been stayed must be excluded; and it would certainly seem right to apply a similar principle to applications in a suit which has been stayed; in terms.
, however, the section does not apply.
The only authority on the point, to which we have been referred, and which was referred to in the lower Courts, is Pulin Chandra Sen vs Amin Mia Muzffar Ahmad (2).
" Saying that this decision had stood for some years and had not been dissented from the learned Chief justice observed "I would rather base the appellant 'scase on the ground that the right to appear for a final decree was suspended duringthe period in which the suit was stayed.
Sucha principle was applied by the CalcuttaHigh Court (1) I.L.R, (2) A.I.R. 1933 Cal.
253 in Lakhan Chunder Sen vs Manhusudan Sen (1) affirmed by the Privy Council in Nrityamoni Dassi vs Lakhan Chandra Sen (2).
" It would thus appear that the learned Chief Justice based his decision really on section 14 of the Limitation Act.
In both the cases referred to by the learned Chief Justice the provisions of section 14 of the Limitation Act were applied.
In Pulin Chandra Sen 's case(3), the facts were these: The next friend of it minor instituted a suit upon a mortgage but died after the preliminary decree was passed.
No new next friend was, however, appointed in his place.
The minor made an application for passing a final decree within 3 years after attaining majority, but three years after the period of grace fixed by the preliminary decree.
The High Court, while holding that though the erstwhile minor was not entitled to claim the benefit of section 6 of the Limitation Act, held that the execution application must be regarded as within time since it had been made within three years from the date when the right to apply accrued to him on his attaining majority.
No doubt, this is a case where in effect the court has applied the principles underlying section 6 though it was clearly of opinion that section 6 in terms did not apply.
There is no discussion of the point at all and, therefore, we do not think that this is a decision which needs to be considered.
The next two decisions relied on are Badruddin Khan vs Mahvar Khan (4) and Managing Committee Sundar Singh Malha Singh Rajput High School, Indora vs Sundar Singh Malha Singh Sanatan Dharma Rajput High School Trust (5).
In both these cases the court applied what according to it were the general principles underlying section 15 of the Limitation Act, though the facts of these cases do not strictly fail within the purview of that section.
The question (1)(1907) 1 (3)A.1 R. (2) Cal.
All Lah.
254 is whether there is any well recognized principle whereunder the period of limitation can be regarded as being suspended because a party is prevented under certain circumstances from taking action in pursuance of his rights.
The Limitation Act is a consolidating and amending statute relating to the limitation of suits, appeals and certain types of applications to courts and must, therefore, be regarded as an exhaustive Code.
It is a piece of adjective or procedural law and not of substantive law.
Rules of procedure, whatever they may be, are to be applied only to matters 'to which they are made applicable by the legislature expressly or by necessary implication.
They cannot be extended by analogy or reference to proceedings to which they do riot expressly apply or could be said to apply by necessary implication.
It would, therefore, not be correct to apply any of the provisions of the Limitation Act to matters which do not strictly fall within the purview of those provisions.
Thus, for instance, period of limitation for various kinds of suits, appeals and applications are prescribed in the First Schedule.
A proceeding which does not fall under any of the articles in that schedule could not be said to be barred by time on the analogy of a matter which is governed by a particular article, For the same reasons the provisions of sections 3 to 28 of Limitation Act cannot be applied to situations which fall outside their purview.
These provisions do not adumbrate any general principles of substantive law nor do they confer any substantive rig, its on litigants and, therefore, cannot be permitted to have greater application than what is explicit or implicit in them.
Suspension of limitation in circumstances of the kind obtaining in these appeals is neither explicit nor implicit in section 15 upon which reliance is placed on behalf of the appellants.
We are, therefore, unable to accept the first argument of Mr. Sastri.
Coming to the second argument of Mr. Sastri it would be useful to reproduce the relevant portion 255 of the letter dated April 1.9, 1949, on which reliance is placed : "The properties of our client 's family and his father, Venkatachalam Chettiar 's share of properties have vested in you in the capacity of Trustees as per the composition scheme of arrangement effected on September 9, 1946 and you are managing the same, and you have to pay Rs. 300 per annum to our client from 1st Chitrai of Sarvajit year (April 14, 1947) for his family expenses as provided in the scheme of composition and you have paid Rs. 300 and for the year Sarvajit and have obtained a receipt therefor from my client.
You have not paid the sum of Rs. 300 due for the year Sarwadhari to our client though he demanded you many times.
As it is learnt that individual No. 2 out of you, are raising non maintainable objections and the sum of Rs. 300 due for the year Virodhi, still remains to be paid, I have been given instructions to demand the total amount of Rs. 600 payable for the aforesaid years.
So you should pay the amount to my client and obtain a receipt therefore within one week after the receipt of this notice.
Further you have till now collected Rs. 17,500 as per the scheme of arrangement and though you have received the amount long time ago, you have not paid to the creditors their dividend amounts, you are bound by law and equity to pay interest to the aforesaid amounts You are hereby informed that as you have not paid to the creditors the dividend amounts my client is put to a heavy loss and that you are bound to bear all the losses that may be caused thereby and make good the losses ; you should immediately pay off the creditors the dividends and in default my client will have to launch 256 proceedings against you and seek reliefs through Court.
" This letter was written by the, vakil of the second defendant to the Trustees demanding payment of the maintenance allowance due to the second defendant.
The second object of this letter was to require the trustees to pay out of the funds in their hands dividends due to the various creditors under the composition scheme.
Mr. Sastri contends that this letter contains a definite admission of the jural relationship between the defendant on the one hand and the creditors on the other i. e., the relationship of creditor and debtor and, therefore, this is an admission of liability under the decrees.
Relying upon the decision of this Court in Khan Bahadur Shapoor Freedom Mazda vs Durga Prosad Chamria (1), he says that the essential requirement for sustaining a plea of acknowledgment under section 19 of the Limitation Act is that the statement on which it is sought to be founded must relate to a subsisting liability, indicate the existence of jural relationship and must be intended, either expressly or implied, to admit that jural relationship.
Where such jural relationship is admitted expressly or impliedly, he contends, that the mere fact that the precise nature of the liability is not mentioned would not prevent the acknowledgment from falling within section 19.
That was a case in which the mortgagor had written to his creditor a letter to the following effect "My dear Durgaprosad.
Chandni Bazar is again advertised for sale on Friday the 11th inst.
I am afraid it will go very cheap.
I had a private offer of Rs. 2,75,000 a few days ago but as soon as they heard it was advertised by the Registrar they withdrew.
As you are interested why do you not take up the whole.
There is only (1) (1962] 1 S.C.R. 140.
257 about 70,000 due to the mortgagee a payment of 10,000 will stop the sale.
Yours sincerely, Sd/ J. C. Galstaun.
" The q qestion to be considered was whether this amounted to an acknowledgment of the mortgagee 's right.
This Court held that it did amount to an acknowledgment and observed thus : "It is thus clear that acknowledgment as prescribed by section 19 merely renews debt; it does not create a new right of action.
It is a mere acknowledgment of the liability in respect of the right in question ; it need not be accompanied by a promise to pay either expressly or even by implication.
The statement on which a plea of acknowledgment is based must relate to a present subsisting liability though the exact nature or the specific character of the said liability may not be indicated in words.
Words used in the acknowledgment must, however, indicate the existence of jural relationship between the parties such as that of debtor and creditor, and it must appear that the statement is made with the intention to admit such jural relationship.
Such intention can be inferred by implication from the nature of the admission and need not be expressed in words.
If the statement is fairly clear then the intention to admit jural relationship may be implied from it.
The admission in question need not be express but must be made in circumstances and in words from which the court can reasonably infer that the person making the admission intended to refer to a subsisting liability as at the date of the statement.
In construing words used in the statements made in 258 writing on which a plea of acknowledgment rests oral evidence has been expressly excluded but surrounding circumstances can always be considered.
Stated generally courts lean in favour of a liberal construction of such statements though it does not mean that where no admission is made one should be inferred.
, or where a statement was made clearly without intending to admit the existence of jural relationship such intention could be fastened on the maker of the statement by an involved or far fetched process of ' reasoning.
Broadly stated that is the effect of the relevant provisions contained in section 19, and there is really no substantial difference between the parties as to the true legal position in this matter. ' In our opinion, this case is not of assistance co the appellants.
In the appeals before us though there was a personal liability on the defendants under the various decrees, their liability which was created by the composition deed was only on properties in which they had, consequent on the creation of a trust under the composition deed, only a beneficial interest.
This new liability had to be discharged by the trustees in whom the legal title to the property vested Thus there were two different sets of persons who were liable, the defendants and the Trustees and their respective liabilities were distinct.
What the defendant No. 2 has referred to is the libility of the Trustees arising under the terms of the deed of composition and could be enforced only against them.
To refer to a liability resting on someone else is not to acknowledge one 's own liability within the meaning of the word in section 19.
The defendant No. 2 has not even indirectly referred to the decree much less to the liability arising under any of them.
In the circumstances we must hold that this letter does not extend the period of limitation.
For these reasons 259 we uphold the decision of the High Court and dismiss each of these appeals with costs.
There will, however, be only one hearing fee.
Appeals dismissed.
[/INST]The jurisdiction of the High Court in the matter of mooroetax references is an advisory jurisdiction and under the Incometax Act the decision of the Appellate Tribunal on facts is final unless it can be successfully assailed on the ground that thoro was 1009 no evidence for the conclusions on facts recorded by the Tribunal.
It is therefore the duty of the High Court to start by looking at the facts found by the Tribunal and answer the questions of law on that footing.
It is not proper to depart from this rule of law as it will convert the High Court into a fact finding authority, which it is not, under the advisory jurisdiction.
As the statement of tile Case prepared by the Appellate Tribunal in accodance with the rules framed under the In come tax Act is prepared with the knowledge of the parties concerned and they have full opportunity to apply for any addition or deletion from that statement, if they have approved of the statement made by the Tribunal, it is the agreed statement of facts by the parties on which the High Court has to pronounce its judgment. ' The High Court would be acting improperly if it takes the arguments one of the counsel for the assessee as if they were facts and bases its conclusion on those arguments.
One of the directors of the assessee company, acting in the capaci ty of managing agents of certain ,Mills, had drawn some hundis in the name of the Mills, and as the Mills repudiated liability, suits were filed on the hundis against the Mills and the assessees.
The assessees thereupon agreed to reim burse the Mills by permitting the latter.
to deduct a moiety of the commission payable to them under the agreement of managing agency, against payments which the Mills may have to make under the decrees.
In their assessment to income tax the assessees claimed that the amounts so deducted should be excluded from their assessable income as business expendi ture under section 10 (2,) (xv) of the incometax Act.
The Appel late Tribunal found that the assessees had agreed to pay off the decree amount from the remuneration due to them, that the decree was passed against them evidently for some mis feasance committed by their directors, that the books of both companies showed that the assesssea were paid their remuneration in full, and that the expenditure was not therefore laid out for the purpose of carrying on the busi ness, and also that, as the payment was made for the liqui dation of a debt, it was not a revenue expenditure.
In the High Court the assessees ' counsel argued, relying on the case of Mitchell vs B. W. Noble Ltd.(1), that the payments were matie by the assessees to avoid the publicity of an action against them and the consequent exposure and less of reputation as a managing agency company, and as such the payments were deductible as business expenditure.
The High Court accepted this argument and reversed the decision of the Tribunel.
Held, that the High Court acted wrongly in accepting the arguments of the assessees ' counsel as if they were proved facts and basing its decision on them; and, as the facts necessary to support the claim for exemption under section 10 (2) (xv) had not been established at any stage of the case, the assessees were not entitlecl to the deduction claimed.
(1) ; 129 1010 Judgment of the Calcutta High Court reversed.
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<s>[INST] Summarize the judgementCivil Appeal No. 1157 of 1974.
Appeal by special leave from the judgment and order dated the 20th June, 1973 of the Andhra Pradesh High Court in Writ Appeal No. 411 of 1973.
F.S. Nariman and P. P. Rao, for the appellant.
A. Subba Rao, for respondents Nos.
1 10, 12 31, 33 and 36.
The Judgment of the Court was delivered by CHANDRACHUD, J.
The Andhra Pradesh Municipalities Act.
VI of 1965, (hereinafter called "the Act") came into force on April 2, 1965.
Section 3(1)(a) of the Act empowers the State Government to constitute a local area as a municipality.
Section 3(1)(b) empowers the Government, by notification in the Gazette "to declare its intention to include within a municipality any local area in the vicinity thereof and defined in such notification".
Section 3(1)(c) confers power on the Government to exclude from a municipality any local area comprised therein and defined in such notification.
Under section 3(2), any resident of a local area or taxpayer of a municipality, in respect of which a notification under section 3(1) is published, may, if he desires to object to anything therein contained, submit his objection in writing to the Government within six weeks from the 546 publication of the notification and the Government is under an obligation to take all such objections into consideration.
Under section 3(3) after the expiry of the aforesaid period o six weeks and on considering the objections, the Government may by notification in the Gazette declare to be a municipality or include in or exclude from a municipality, the local area or any portion thereof.
By section 3(4), the provisions of the Act come into force in or cease to apply to and municipality or part thereof, as the case may be, on the date of publication of notification under sub section (3) if such date is the first day of April, or in any other case, on the first day of April immediately succeeding the 'date of publication of such notification.
Respondents 1 to 36 are residents of two villages called Ramakrishnapuram and Sriharipuram.
Prior to the year 1966, the area comprised in these villages was not included within the municipal limits of the Visakhapatnam Municipality.
Most of these respondents own properties situated within the limits of the two villages but they were not assessed to property tax under the Andhra Pradesh (Andhra Area) District Municipalities Act 1920 which was in force until the introduction of the Act.
They used to pay taxes to the village Panchayat.
In exercise of the powers conferred by the corresponding provision of the District Municipalities Act, 1920, namely section 4(1)(c), the Government of Andhra Pradesh declared its intention to include within the limits of Visakhapatnam Municipality the local area comprised in the villages of Ramakrishnapuram and Sriharipuram.
The district Municipalities Act, 1920 was repealed by section 391(1) of the Act which, as stated earlier, came into force on April 2, 1965.
On March 24, 1966 the Government of Andhra Pradesh acting in the exercise or powers conferred by section 3(3) of the Act issued a notification including within the limits of the Visakhapatnam Municipality the area comprised in the villages of Ramakrishnapuram and Sriharipuram with effect from April 1, 1966.
on March 24, 1970 and June 10, 1970 the Municipal Council declared its intention to levy property tax in the areas newly included within the municipal limits.
After considering the objections, the Council passed a resolution on August 28, 1970 confirming the levy of property tax on buildings and lands situated within the municipal limits, with effect from October 1, 1970.
However, the municipality issued notices to respondents 1 to 36 demanding property tax from them not from October 1, 1970 but from April 1, 1966, that is to say, with effect from the date when the villages of Ramakrishnapuram and Sriharipuram were included within the municipal limits.
These notices would appear to have been issued on the supposition that taxes leviable under the District Municipalities Act, 1920 could be levied under clause 12, Schedule IX of the Act, unless the Government directed otherwise.
On January 24, 1971 respondents 1 to 36 filed writ petition 442 of 1971 in the High Court of Andhra Pradesh against the State of 547 Andhra Pradesh and the Visakhapatnam Municipality asking for a declaration that the levy of property tax on their properties for the period prior to October 1, 1970 was illegal.
The writ petition was dismissed by a learned Single Judge on the view that it was competent to the municipality, under the District Municipalities Act 1920, to levy property tax on properties situated in the newly included areas from April 1, 1966 to October 1, 1970.
Respondents 1 to 36 filed writ appeal 411 of 1972 against the decision on the Single Judge, which was allowed by a Division Bench of the High Court by its judgment dated June 13, 1972.
lt held that the provisions contained in clause 12 of Schedule IX had no application and that it was incompetent to the municipality to impose the property tax on the newly included areas without following the procedure prescribed by sections 81 and 83 of the Act.
The correctness of that view is challenged by the Visakhapatnam Municipality in this appeal by special leave.
The State of Andhra Pradesh is respondent No. 37 to the appeal.
The circumstance that whereas the preliminary notification declaring the intention of the State Government to include new areas within the municipal limits was issued under the District Municipalities Act 1920, the final notification confirming that intention was issued under the Act presents no difficulty.
In so far as relevant, Schedule IX clause 13 of the Act, read with clause 1, provides that any action taken under the District Municipalities Act, 1920 by any authority before the commencement of the Act shall, unless inconsistent with the Act be deemed to have been taken by the authority competent to take such action under the Act.
The preliminary notification, though issued under section 4(1) (c) of the 1920 Act must therefore be deemed to have been issued under section 3(1)(b) of the Act.
The inclusion of the villages of Ramakrishnapuram and Sriharipuram within the limits of the Visakhapatnam Municipality is accordingly in order.
The true question for our consideration is whether the property tax which could lawfully be levied under the District Municipalities Act, 1920 can be levied, after the repeal of that Act, on properties situated in the areas included within the municipal limits after the constitution of the municipality.
Section 391(1) of the Act expressly appeals the District Municipalities Act, 1920 from which it must follow that ordinarily, no action can be taken under the Act of 1920 after April 1,1966 when the repeal became effective on the coming into force of the Act.
But counsel for the appellant municipality contends that clause 12 of Schedule IX of the Act keeps the repealed enactments alive for tax purposes and therefore the municipality has authority to impose the property tax under the Act of 1920, notwithstanding its repeal by the Act.
Schedule IX appears under the title "Transitional Provisions" and clause 12 thereof reads thus: 548 "12.
Continuance of existing taxes, etc.
Any tax, cess or fee which was being lawfully levied by or on behalf of any council at the commencement of this Act and which may be lawfully levied under this Act, shall, notwithstanding any change in the method or manner of assessment or levy of such tax, cess or fee, continue to be levied by or on behalf of the council for the year in which this Act is brought into .
force, and unless the Government by general or special order otherwise direct, for subsequent years also.
" This provision cannot justify the imposition of tax under the repealed Act of 1920 on properties situated in the newly included areas.
In the first place, as the very title of Schedule IX shows, the provisions contained in the Schedule are of a transitional nature.
They are intended to apply during the period of transition following upon the repeal of old municipal laws and the introduction of the new law.
Some time must necessarily elapse before a municipality can act under the new law but taxes have all the same to the imposed and collected during the interregnum.
The object of clause 12 of Schedule IX is to authorise the levy of taxes which, on the commencement of the Act, were levied under the repealed laws.
The material date for this purpose is the date of the commencement of the Act, namely April 1, 1966 and the legality of the exercise of the power conferred by clause 12 is to be judged in reference to that date.
In other words, if any tax, cess or fee was being lawfully levied by or on behalf of any council on April 1, 1966 and if it can be lawfully levied under the Act, it can continue to be levied notwithstanding any change in the method or manner of assessment or levy of such tax, cess or fee.
On April 1, 1966 no tax at all was being levied by or on behalf of any council on properties situated in Ramakrishnapuram and Sriharipuram and therefore the appellant municipality had no occasion or power to direct that the property tax may "continue to be levied" on those properties.
"Continuance of existing taxes", after the commencement of the Act being the theme of clause 12 and since the property tax was not levied by or on behalf of any council at the commencement of the Act on the properties situated in the two villages, clause 12 has no application.
Imposition of certain kinds of taxes is an obligatory function of municipal councils, under the Act.
Section 81(1)(a) provides that every council shall, by resolution, levy a property tax, a profession tax, a tax on carriages and carts and a tax on animals.
under.
section 81(2) a resolution of a council determining to levy tax shall specify the rate at which and the date from which the tax shall be levied.
The first proviso to this sub section requires that "before passing a resolution imposing a tax for the first time" or increasing the rate of an existing tax, the council shall publish a notice in the prescribed manner declaring the requisite intention The council has further to invite objections and it is under an obligation to consider the objections received within the stipulated time.
By section 83, when a council determines, subject to the provisions of section 81, to levy any tax for the first time or at a new rate, the Secretary shall forthwith publish a 549 notification in the prescribed manner specifying the rate at which, the date from which and the period of levy, it any, for which, such tax shall be levied.
Section 83 is thus expressly subject to section 81 and under the latter provision no tax can be imposed "for the first time" unless the procedure prescribed therein is followed.
Since the procedure prescribed by the first proviso to section 81(2) was not followed in regard to the period prior to October 1, 1970 the levy of property tax on the properties of respondents 1 to 36 for that period is without the authority of law and consequently illegal.
It was urged on behalf of The appellant that the first proviso to section 81(2) would apply only when a tax was imposed for the first time ' and since appellant was levying properly tax long before its imposition on the properties of respondents 1 to 36, it was unnecessary to follow the procedure prescribed by the proviso.
It is not possible to accept this submission.
The Municipality might have been levying property tax since long on properties situated within its limits but until April 1, 1966 the villages of Rarmakrishnapuram and Shriharipuram were outside those limits.
Qua the areas newly included within the municipal limits, the tax was being imposed for the first time and therefore it was incumbent on the Municipality to follow the procedure prescribed by the first proviso to section 81(2).
Residents and taxpayers of those areas, like respondents 1 to 36, never had an opportunity to object to the imposition of the tax and that valuable opportunity cannot be denied to them.
It is obligatory upon the Municipality not only to invite objections to the proposed tax but also to consider the objections received by it within the specified period.
Such period has to be reasonable, not being less than one month.
The policy of the law is to afford to those likely to be affected by the imposition of the tax a reasonable opportunity to object to the proposed levy.
According to the appellant, the residents of Ramakrishnapuram and Sriharipuram had an opportunity to object to the imposition of the tax when the State Government issued a notification under section 3(1)(b) of the Act declaring its intention to include the two villages within the limits of the municipality.
It is not possible to accept this submission either.
When the State Government issues a notification under any of the clauses of section 3(1), any resident of the local area concerned or any tax payer of the municipality can "object to anything therein contained" meaning thereby, anything contained in the notification.
A notification issued under section 3 (1) (b) contains only the declaration of the Government 's intention "to include within a municipality any local area in the vicinity thereof and defined in such notification".
The right of objection would therefore be limited to the question whether a particular area should, as proposed, be included within the municipal limits.
It would be premature at that stage to offer objections to the imposition of any tax because it is only after the final Notification is issued under section 3(3) that the question would at all arise as regards the imposition of a tax on the newly included areas.
A notification under section 3(3) has to be followed by a 550 resolution under section 81(1) if the municipality wants to impose a tax, and for the resolution to be effective, the procedure prescribed by the first proviso to section 81(2) has to be followed.
The appellant municipality short circuited this mandatory procedure and thereby deprived respondents 1 to 36 of the valuable right of objecting to the imposition of the tax.
Finally, relying on section 3(4) of the Act, learned counsel for the appellant contended that the inclusion of the two villages within the municipal area attracts of its own force every provision of the Act with effect from the date on which the final notification is published by the Government under section 3(3).
This argument is said to find support in a decision of this Court in Atlas Cycle Industries Ltd. vs State of Haryana & Anr.(1).
Far from supporting the argument, we consider that the decision shows how a provision like the one contained in Section 3(4) cannot have the effect contended for by the "appellant in the Atlas Cycle case, section 5(4) of the Punjab Municipality Act.
1911 provided that when any local area was included in a municipality, "this Act and. . . all rules, bye laws, orders, directions and powers made, issued or conferred under this Act and in force throughout the whole municipality at the time, shall apply to such areas".
The industrial area within which the factory of the Atlas Cycle was situated was by a notification included within the municipality of Sonepat.
The municipality thereafter purported to impose octroi duty on the goods manufactured, by the company without following the procedure corresponding to that prescribed by sections 81 and 83 of the Act.
It was held by this Court that since section 5(4) of the Punjab Act did not, significantly, refer to notifications and since section 62(10) of the Punjab Act spoke of "notification" for the imposition of taxes, it was not competent to the municipality to levy and collect octroi from the company on the strength merely of the provision contained in section 5(4) of the Punjab Act.
Tn the instant case, what section 3(4) provides is that once a notification including any area within a municipality is published under section 3(3), "The provisions of this Act shall come into force into . . any municipality or part thereof. .on the date of publication of the notification under sub section (3), if such date is the first day of April, or in any other case, on the first day of April immediately succeeding the date of publication of such notification".
by section 3(4), once a notification is issued under section 3(3), all the provisions of the Act come into force.
That means that sections 81 and 83, which are a part of the act, would also apply to the entire Municipal area.
It would then be obligatory for the municipality to follow the procedure prescribed in these sections.
Taxes can be imposed under the Act only by passing appropriate resolutions under section 81.
Section 3(4) does not provide that on the inclusion of a new area within a municipality, the resolutions passed by the municipal council before such inclusion will automatically apply to the new area.
Plainly, such could not be the intention of the legislature in (1) ; 551 view of the importance which it has attached to the right of the citizens to object to the imposition of a proposed tax.
Though, therefore, by reason of section 3(4) the provisions of the Act would apply to the new areas included within a municipality, it is not competent to the municipality to take resourse to the resolution passed for imposing tax on the old areas for the purpose of levying taxes on new areas.
The procedure prescribed by section 81 and 83 must be followed if a tax is proposed to be levied on the new areas.
For these reasons we confirm the judgment rendered by the Division Bench of the High Court and dismiss this appeal with costs.
V.P.S. Appeal dismissed.
[/INST]Under section 4(1)(c) of the District Municipalities Act, 1920, the State Government declared its intention to include within the limits of the appellant municipality the local areas comprised in two villages. 'The 1920 Act was repealed by the Andhra Pradesh Municipalities Act, 1965 which came into force on April 2, 1965.
Section 3(1)(b) of the 1965 Act corresponds to section 4(1)(c) of the repealed Act.
Under s.3(3), the Government may include within a municipality a local area after considering any objections submitted by the residents of the local are: Under section 3(4) the provisions of the 1965 Act come into force in that area on the first April, if that is the date of the notification under sub section
(3) and in any other cases the first day of April immediately succeeding.
The State Government, in exercise of its power under section 3(3) of the 1965 Act, issued the notification in March 1966 including within the limits of the appellant municipality the areas comprised in the two villages with effect from April 1, 1966.
In 1971, the Municipal Council after considering objections, passed a resolution for levying property tax on land and buildings in the two villages with effect from October 1, 1970, but, The municipality issued notices to the respondents, who were residents of those two villages, demanding the property tax from them from April 1, 1966 the date of inclusion of the villages.
The respondents thereupon challenged the levy and the High Court upheld the challenge.
In appeal to this Court, it was contended that the appellant municipality was entitled to demand the tax even from April 1, 1966, under cl. 12 of Schedule 9 of the 1965 Act.
This clause provided that any tax which was being lawfully levied by the municipal council at the commencement of the 1965 Act and which may be lawfully levied under that Act shall continue to be levied by the council unless the Government by general or special order directs otherwise.
Dismissing the appeal to this Court, ^ HELD :(1) The inclusion of the two villages within the limits of the appellant municipality is in order, because, under cl. 13 of Schedule 9 of the 1965 Act the notification issued under section 4(1) of the 1920 Act must be deemed to have been issued under section 3 (1) of the 1965 Act.
[547 D F] (2) However, clause 12 of Schedule 9 cannot justify the imposition of the tax under the repealed Act of 1920, from April 1, 1966, on property situate in the newly included areas.
[548 B C] (a) The clause is of a transitional nature and its object is to authorise the levy of taxes which, at the commencement of the 1965 Act were levied under the repealed law.
That is, in the present case, if any tax etc. was being lawfully levied by the appellant on April 1, 1966, (which was the date of commencement of the Act in the two villages) and if it can be lawfully levied under the 1965 Act, it can continue to be levied.
But on April 1, 1966, no tax at all.
was being levied by or on behalf of the appellant on the property situate in the two villages included within the municipality on that date.
Therefore, the appellant had no occasion or power to direct that a property tax may continue to be levied on those properties, and hence cl.
12 has no application.
[548 C E] (b) It cannot be urged that because the appellant was levying property tax on property situate within its limits (other than the 2 villages) the property tax was not being levied for the first time.
Qua the two villages newly 545 included in the municipal limits, the tax was being imposed for the first time, and therefore, it was incumbent upon the municipality to follow the procedure prescribed by the first proviso to section 81(2), because, the residents of these areas had no opportunity to object lo the imposition of tax or for the municipality to invite objections and consider them.
[549 C E] (3) The first proviso to section 81 requires that before passing a resolution imposing a tax for the first time the council shall publish a notice, invite objections and consider the objections received within the stipulated time.
Since the procedure was not followed in regard to the period prior to October 1, 1970 the levy of property tax on the properties of the respondents for that period is without authority of law and consequently illegal.
By section 83 when a council determines to levy any tax for the first time or at a new rate the Secretary shall forthwith publish a notification in the prescribed manner specifying the rate and the date from which the tax shall be levied.
Section 83 is expressly subject to section 81 and under the latter provision no tax can be imposed for the first time unless the procedure prescribed therein is followed [548G 549 B] (4) When the State Government issued the notification declaring its intention to include the two villages within the limits of the municipality the residents had an opportunity to object, not to the imposition of the tax but only to "any thing contained therein", meaning anything contained in the notification, that is to the inclusion within the municipality.
The question of imposition of a tax within the included areas, arises only after the final notification under section 3(3) followed by a resolution under section 81 (1) .
[547F 550 B] (5) It could not also be contended that mere inclusion of two villages with in the municipal area automatically attracts the tax.
On the contrary, what section . (4) provides is that once a notification including any area within a municipality is published under section 3(3), the provisions of the Act, that is, sections 81 and 83, shall come into force in that area from the first day of April, and hence, the procedure prescribed therein will have to be followed.[550 F H] Atlas Cycle Industries Ltd. vs State of Haryana & Anr. ; , explained.
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<s>[INST] Summarize the judgementAppeal No. 107 of 1953.
Appeal by special leave from the judgment and decree dated the 7th February 1949 of the Patna High Court in appeal from original decrees No. 230 and 268 of 1945 arising out of the decree dated the 9th 3 day of August 1945 of the Second Court of Subordinate Judge at Monghyr in Title Suit No. 40 of 1943.
P. K. Chatterjee, for the appellants.
Tarachand Brijmohanlal, B. C. Misra and section Barneshwar Prasad, for respondents Nos.
3 to 6, 20 to 25 and 27 to 39.
January 16.
The Judgment of the Court was delivered by VENKATARAMA AYYAR J.
The properties which are the subject matter of this litigation are agricultural lands of the extent of 18 acres 23 cents situate in Mauza Chowki.
They originally belonged to Khiran Rai, Firangi Rai and others, and were usufructuarily mortgaged by them on 10 8 1900 to Babunath Prasad and Babu Misri Lal under two sudbharna deeds, Exhibits 2 and 3, for a sum of Rs. 1,600.
The defendants of the first party are the representatives of these mortgagees.
In execution of a money decree passed against the mortgagors, 9 acres 6 cents out of the above lands were brought to sale on 11 6 1907 and purchased by Rameshwar Prasad Singh, the undivided uncle of the first plaintiff.
On 23 12 1913 the remaining extent of 9 acres 17 cents was purchased by the.
first plaintiff from the mortgagors, and thus, the plaintiffs who were members of a joint Hindu family became entitled to all the interests of the mortgagors in the suit lands.
In 1943 they deposited under section 83 of the Transfer of Property Act the amounts due on the mortgage deeds, Exhibits 2 and 3, in the court of the District Munsif, Monghyr.
The defendants of the first party withdrew the amount, and the mortgages thus became redeemed.
When the plaintiffs attempted to take khas or actual possession of the lands, they were obstructed by the defendants of the second party who claimed occupancy rights therein.
The plaintiffs then instituted the suit out of which the present appeal arises, in the court of the Subordinate Judge, Monghyr, for recovery of possession of the lands from the second party defendants.
4 The plaintiffs alleged that the lands were 'kamat khudkast ' which had been in the personal enjoyment of Khiran Rai and Firangi Rai and thereafter of the mortgagees and the defendants of the first party by virtue of the sudbharna deeds, Exhibits 2 and 3, that the second party defendants claimed rights as occupancy raiyats under a settlement by the mortgagees, that the settlement was not real or bona fide, and was not binding on the mortgagors.
In the alternative, the plaintiffs claimed damages against the defendants of the first party, if it was found that the second party bad acquired occupancy rights under a settle ment from them.
Both sets of defendants denied that the lands were kamat lands, or that the defendants of the first party settled the defendants of the second party as raiyats on the land.
They pleaded that the latter had been in possession even prior to the mortgages, Exhibits 2 and 3, under a settlement with the mortgagors, and that accordingly the plaintiffs were entitled neither to possession from the second party nor damages from the first party.
The Subordinate Judge of Mongbyr who tried the suit, held that the lands were private lands of the proprietors, that the defendants of the second party or their predecessors in title bad not been inducted on the lands by the mortgagors, that they were put into possession by the mortgagees only under the lease deed, Exhibit 2(a) dated 27th May 1905, that they were mere creatures of the first party, and that the settlement was not bona fide and not binding on the plaintiffs.
He accordingly granted a decree in favour of the plaintiffs in ejectment.
Against this judgment, there was an appeal by the defendants to the High Court of Patna, which agreed with the Subordinate Judge that the defendants of the second party were inducted into possession only in 1905 under the lease deed, Exhibit 2(a), and that they were not raiyats settled by the mortgagors prior to 1900.
But the learned Judges held that the suit lands were not proved to be 'sir ' or private lands, that the second party defendants were not the creatures of the first party, that the lease deed, Exhibit 2(a) was a 5 bona fide transaction, and that the recognition of the defendants of the second party by the mortgagees as tenants would confer occupancy rights on them.
In the result, the suit was dismissed.
The plaintiffs appeal.
It may be stated that the alternative claim for damages against the first party was abandoned by the plaintiffs, and the only relief now claimed is possession of lands as against the second party.
Mr. Misra, counsel for the first party, had accordingly nothing to say about the merits of the controversy between the appellants and the second party defendants, and merely pressed for his costs being awarded.
It was the second party appearing by counsel Mr. Tarachand Brijmohan Lal, that vigorously contested the appeal.
The substantial question that arises for our decision is whether the lands in dispute are private lands of the proprietor.
Section 120(2) of the Bihar Tenancy Act VIII of 1885, hereinafter referred to as the Act, enacts a presumption that "land is not a proprietor 's private land, until the contrary is shown".
And further, there was a cadastral survey in 1908, and in the final notification published under section 103 A of the Act, the lands were recorded as in the possession of the second party defendants, whose status was described as 'kaimi ' or settled raiyats.
Under section 103 B(3), "every entry in a record of rights so published shall be evidence of the matter referred to in such entry, and shall be presumed to be correct until it is proved by evidence to be incorrect".
The result of both these provisions is that the burden is on the proprietor clearly to establish that the lands are his private lands.
Some oral evidence has been adduced by both sides as to the character of the lands, but it is too vague, recent and interested to be of much value, and the question therefore falls primarily to be decided on the 'documentary evidence in the case.
The earliest document bearing on the question is Exhibit 1, which is a mortgage deed executed by the previous owners, Firangi Rai and others, to Harbans Narain Singh on the 10th April, 1893 over a portion 6 of the suit lands.
Therein, it is recited that the mortgagors "mortgage, hypothecate and render liable the properties constituting the proprietory mukarri interest, with all the zamindari rights and claims including the khudkasht kamat lands".
The word 'khudkasht ' means personal cultivation, and that is a neutral expression, which might include both private lands and bakasht lands, that is to say, raiyati lands, which had come into the possession of the proprietor by surrender, abandonment or otherwise.
But the word 'kamat ' has a definite connotation, and means private lands.
Vide section 116 of the Bihar Tenancy Act.
If the recital in Exhibit I is to be accepted as correct, the lands were on that date in the personal cultivation of the proprietor as private lands.
Exhibits 2 and 3 are the sudbharna deeds dated 10 8 1900 under which the first party defendants got into possession of the suit lands.
They are in the same terms, and recite the at the mortgagees are to enter into possession and occupation of lands, " cultivate or cause to be cultivated the same for their self satisfaction", and that after the expiry of the period fixed for redemption, the mortgagors are to pay the mortgage amounts in one lump and take back the properties "in our sir and khas possession".
The word 'sir ' is synonymous with 'kamat ' and 'ziraat ', and means private lands of the proprietor.
(Vide section 116).
These recitals are of considerable importance, as they occur in deeds inter parties.
The respondents are right in contending that they cannot be regarded as admissions by the mortgagees as the deeds were executed by the mortgagors; but they are certainly admissible under section 13 of the Evidence Act as assertions of title, and as it is under these documents that the first party defendants claim, their probative value as against them and as against the second party defendants who claim under them is high.
Exhibit I (b) is a simple mortgage executed by Firangi Rai and others on 21 12 1901 in favour of one Chhotu Singh over some properties forming part of the suit lands.
It also contains the recital that these properties are kamat khudkasht lands.
There 7 is finally the lease deed executed in favour of the first party by the defendants of the second party, Exhibit 2(a) under which the latter came into possession of the lands.
It recites that the lands had been in the exclusive cultivation of Babu Nath Prasad and Babu Misri Lal, that the lessees will give up possession of the lands at the end of the term which was a period of 2 years,, and that the lessors will be "competent to bring the lands mentioned in this kabuliat under their exclusive cultivation".
As these documents are ante litem motam, and as some of them, are inter parties and extend over a considerable period of time, they form cogent and strong evidence that the lands are private lands.
Now, what is the evidence adduced by the defendants to rebut the inference to be drawn from them? None.
They simply trust to the presumptions in their favour enacted in sections 120(2) and 103 B of the Act to non suit the plaintiffs.
But these are rebuttable presumptions, and they have, in our opinion, been rebutted by the evidence in the suit, which is all one way.
It was argued for the respondents that even if the evidence referred to above was accepted, that would be insufficient under section 120 of the Act to support a finding that the lands were private lands.
Section 120 runs as follows: "(1) The Revenue Officer shall record as a proprietor 's private land (a) land, which is proved to have been cultivated as khamar, ziraat , sir, nij, nijjot or kamat by the propriet or, himself with his own stock or by his own servants or by hired labour for twelve continuous years immediately before the passing of this Act, and (b) cultivated land which is recognised by village usage as proprietor 's khamar, ziraat, sir, nij, nijjot or kamat.
(2) In determining whether any other land ought to be recorded as a proprietor 's private land, the officer shall have regard to local custom, and to the question whether the land was, before the second day 8 of March, 1883, specifically let as proprietor 's private land, and to any other evidence that may be produced; but shall presume that land is not a proprietor 's private land until the contrary is shown.
(3)If any question arises in a Civil Court as to whether land is or is not a proprietor 's private land, the Court shall have regard to the rules laid down in this section for the guidance of Revenue Officers".
The contention of the respondents is that under this section before lands could be held to be private, it must be shown that they had been cultivated as private lands for 12 years prior to the date of the Act, and that as the evidence in the case went back only to 1893, the requirements of the section were not satisfied.
This argument proceeds on a misconception about the true scope of section 120.
That section does not enact that no land shall be recorded as private, unless it is proved to have been cultivated as private land for 12 years prior to the date of the Act.
It only provides that when that is proved, it shall be recorded as private land.
But when no such evidence is forthcoming, it does not preclude that fact from being established by "any other evidence that may be produced", if that is relevant and admissible under the provisions of the Evidence Act.
That was the view taken in Maharaja Kesho Prasad Singh vs Parmeshri Prasad Singh(1), and on appeal, the Privy Council agreed with it in Bindeshwari Prasad Singh vs Maharaja Kesho Prasad Singh(2).
The position, therefore, is that section 120 merely enacts certain rules of evidence to be followed in an enquiry as to whether a disputed land is 'ziraat '.
When in such enquiry the facts mentioned in section 120(1) are established, the law raises a presumptio juris et de jure that the lands are private.
But where such evidence is not available, that fact can still be estab lished by otber and satisfactory evidence.
What has to be decided therefore is whether the evidence actually adduced by the plaintiffs in the present case is (1) Patna 414.
(2) [1926] 53 I.A. 164, 9 sufficient to discharge the burden which the law casts on them and to prove that the lands are 'kamat ' or 'sir ' lands.
For the reasons already given, weare of opinion that it is sufficient to justify a findidg in the affirmative.
Strong reliance was placed by the respondents on Exhibits F 1 and F 1(1) which are khatians relating to the suit lands published on 7 12 1909 recording them as in the possession of the defendants of the second party as 'kaimi ' and on the presumption under section 103 B that that entry is correct.
This presumption, it is contended, is particularly strong in the present case, because the predecessors in title of the plaintiffs were parties to the proceedings and contested the same, and that the record of rights was made after considering their objections.
The plaintiffs, however, denied that they were parties to the proceedings, and contended that they were taken behind their back by the mortgagees and the second party defendants acting in collusion with a view to defeat their rights.
Exhibits A 1 and A 1(1) are certified copies of the objection petitions stated to have been filed by the mortgagors under section 103 A of the Act, and they purport to have been signed by one Chulai Mahto as karpardaz of some of the mortgagors.
The plaintiffs deny the genuineness of the signatures in Exhibits A 1 and A 1(1) and also the authority of Chulai Mahto to represent the mortgagors.
There is no evidence that the signatures on Exhibits A 1 and A 1 (1) are true, but the defendants rely on the presumption enacted in section 90 of the Evidence Act in favour of their genuineness.
But Exhibits A 1 and A 1 (I) are merely certified copies of the objection petitions filed before the Survey Officer and not the originals, and it was held in Basant vs Brijraj(1) that the presumption enacted in the section can be raised only with reference to original documents and not to copies thereof.
There is the further difficulty in the way of the respondents that the documents are signed by Chulai Mahto as agent, and there is no proof that he was an agent, (1) [1935] 62 I.A. 180.
10 and section 90 does not authorise the raising of a presumption as to the existence of authority on the part of Chulai Mahto to represent the mortgagors.
It is again to be noted that the objection on the merits raised in Exhibits A 1 and A 1(1) that the lands are bakasht lands in the possession of mortgagees is not one which it was to the interests of the mortgagors to put forward, as, if accepted, it would preclude them from admitting tenants in respect of them, without conferring on them the status of settled raiyats and occupancy rights under section 21 of the Act.
It was only if the lands were private lands that the proprietor would be entitled to cultivate them personally, and that was the claim which they had been making consistently from 1893 onwards.
The claim put forward in Exhibits A 1 and and A 1(1) is destructive of the rights claimed all along by the mortgagors, and amounts to an admission that the lands are not private and raises the doubt that the petitions were not really inspired by them.
It should also be mentioned that at the hearing of the petition, no evidence was adduced by the mortgagors, and the decision of the Survey Officer was given practically ex parte.
The mortgagees were parties to the proceedings, and they did not appear and produce the mortgage deeds, Exhibits 2 and 3, under which they got into possession, and which described the lands as 'sir '.
It was to the interests of the mortgagees that the 'lands should be held to be 'sir ', and it was further their duty to defend the title of the mortgagors as against the claim made by the tenants that they were raiyati lands.
Why then did they not produce Exhibits 2 and 3 at the hearing? The recitals in the lease deed, Exhibit 2(a) which was executed by the defendants of the second party, were inconsistent with their claim that the lands were raiyati.
Why did they not produce it at the hearing ? Thereis therefore much to be said for the contention ofthe appellants that the proceedings evidenced by Exhibits A 1 and A 1(1) were collusive in character.
But even assuming that they were real, that 11 would not materially affect the result, as the true effect of a record of rights under section 103 A is not to create rights where none existed but simply to raise a presumption under section 103 B that such ' rights exist, and that presumption is one liable to be rebutted.
There is a long line of authorities that a person who attacks a record made under section 103 A as incorrect discharges the burden which the law casts on him under section 103 B by showing that it was not justified on the materials on which it is based.
Vide Bogha Mower vs Ram Lakhan(1) and Eakub Ali vs Muhammad Ali(2).
And where., as here, no evidence was placed before the authorities who made the record, he has only to produce evidence which satisfies the court that the entry is erroneous.
Whether the question is considered with reference to the presumption under section 120(2) or section 103 B, the position is the same.
The plaintiffs who claim that the lands are kamat have to establish it by clear and satisfactory evidence.
If the evidence adduced by them is sufficient, as we have held it is, to establish it, the presumption under section 103 B equally with that under section 120(2 becomes displaced.
In the result, we are of opinion that the suit lands are the private lands of the proprietor.
It was next contended that even if the lands were private lands, that would not prevent the acquis tion of occupancy rights by the tenants under Chapter V, as the restriction provided in section 116 in that behalf did not apply on the facts of the present case, and that in consequence no relief in ejectment could be granted.
Section 116 enacts, omitting what is not material, that "nothing in Chapter V shall confer a right of occupancy in a proprietor 's private land where any such land is held under a lease for a term of years or under a lease from year to year".
, In the present case,, the tenants got into possession under Exhibit 2(a), which was a lease for two years, and they would therefore be precluded from acquiring occupancy rights by virtue of that demise.
But it is argued that the tenants continued in possession of (1) (2) 12 the holdings even after the expiry of the term under Exhibit 2(a), paid the rent to the mortgagees who recognised them as tenants, and that their status therefore was not that of tenants holding under a lease for a term or from year to year, and that accordingly there was no impediment to their acquiring occupancy rights under Chapter V.
The point has not been argued whether, as Exhibit 2(a) is an agricultural lease, the tenants who held over after the expiry of the period fixed therein, should not be con, sidered to hold as tenants from year to year, on the principle enacted in sections 106 and 116 of the Transfer of Property Act.
We shall proceed on the footing that on the findings of the High Court that the tenants were riot the creatures or servants of the mortgagees, and that they had been in continuous possession paying rent to them, section 116 did not debar them from acquiring rights under Chapter V.
But the question is whether they acquired such rights under that Chapter.
Section 21 provides that every person who is a settled raiyat in a village shall have a right of occupancy in all land for the time being held by him as a raiyat in that village.
Section 20 defines a settled raiyat as a person who holds continuously land for a period of 12 years in any village.
Section 5(2) defines 'raiyat ' as a person who has acquired a right to bold land for the purpose of cultivating it by himself or members of his family or servants or partners, and section 5 (3) provides that "a person shall not be deemed to be a raiyat unless he holds land either immediately under a proprietor or immediately under a tenure bolder".
The position therefore is that before a person can claim occupancy rights under section 21, he must establish that he is a raiyat as defined in sections 5(2) and 5(3), and as the defendants of the second party acquired the right to hold the lands for the purpose of cultivation from the first party mortgagees and not under the mortgagors, they are not raiyats as defided in section 5(3), and can claim no rights under section 21.
On behalf of the tenants, it was contended that as under section 58 of the Transfer of Property Act a 13 mortgage is a transfer of interest in land, the mortgagee is the owner of that interest and therefore a proprietor for the purpose of section 5(3).
Section 3(2) defines a proprietor as meaning a person owning whether in trust or for his own benefit an estate or part of an estate.
A mortgagee is no doubt the transferee of an interest in immovable property, and may in a loose sense be said to be the owner of that interest.
But the definition of a proprietor requires that he should own the estate or part thereof and not merely an interest therein.
It would be a contradiction in terms to say of a mortgagee that he owns the estate over which he owns an interest.
As observed in Ghose on the Law of Mortgage in India, Volume I, page 77, "Interest which passes to the mortgagee is not the ownership or dominion which, notwithstanding the mortgage, resides in the mortgagor".
The question whether for purposes of section 21 of the Act a tenant from a mortgagee can be held to be a raiyat as defined in section 5(3) was considered by this Court in Mahabir Gope and others vs Harban8 Narain Singh and others(1), and it was held that a mortgagee is neither a proprietor nor a tenure holder, and a tenant inducted by him on the lands is not a raiyat within the definition of those terms under the Act.
That decision governs this case.
The contention of the respondents that the mortgagees could be considered as tenure holders within section 5(3) is equally untenable.
Section 5(1) defines a tenure holder as meaning a person who has acquired a right to hold lands for collecting rents or for bringing them into cultivation by establishing tenants thereon.
In the present case, the lands were under the personal cultivation of the mortgagors at the time when they were mortgaged under Exhibits 2 and 3.
There were then no raiyats on the land and no 'question of transferring the right to collect rent from them.
The respondents relied on the terms in Exhibits 2 and 3 that the mortgagees might cultivate the lands or cause them to be cultivated at their pleasure, as authorising the establishment of tenants.
But that (1) , 781.
14 clause would apply only if the lands had to be brought afresh under cultivation, and that was not the position here.
As the mortgagees are neither proprietors nor tenure holders as defined in the Act, the tenants holding under them could not claim to be raiyats as defined in sections.5(2) and 5(3), and no occupancy rights could therefore be acquired by them under section 21 of the Act.
It was next contended that the mortgagees had the power under section 76 of the Transfer of Property Act to induct tenants on the land for purposes of cultivation, that such a transaction.
would be binding on the mortgagors, and that its effect would be to confer on the tenants the status of raiyats and that they would get occupancy rights under section 21 of the Act.
The decisions in Manjhil Lal Biswa Nath Sah Deo vs Mahiuddin(1), Rajendra Nath vs Dinu Prodhan(2) and Pramatha Nath vs Sashi Bhu8an(3) were relied on in support of this contention.
This argument proceeds on a confusion of two wholly independent concepts distinct in their origin and different in their legal incidents.
The law is that a person cannot confer on another any right higher than what he himself possesses, and therefore, a lease created by a usufructuary mortgagee would normally terminate on the redemption of the mortgage.
Section 76(a) enacts an exception to this rule.
If the lease is one which could have been made by the owner in the course of prudent management, it would be binding on the mortgagors, notwithstanding that the mortgage has been redeemed.
Even in such a case, the operation of the lease cannot extend beyond the period for which it was granted.
In the present case, assuming that the mortgagees bad the power under section 76(a) of the Transfer of Property Act to continue the lessees under Exhibit 2(a) as tenants on the lands after the termination of the period fixed therein that would confer on them at best the status of tenants from year to year and not give them the right to continue in possession after the termination of the agricultural year during which the redemption (1) (2) A.I.R. 1930 Cal.
(3)A.I.R. 15 takes place.
In this view, the power of the mortgagee under section 76(a) of the Transfer of Property Act to induct tenants in the usual course of management would not avail the respondents to claim occupancy rights over the lands.
Turning next to the provisions of the Bihar Tenancy Act, section 21 confers on settled raiyats a permanent right of occupancy, provided the conditions mentioned in that section are satisfied.
But this right is a creature of the statute, and cannot be claimed apart from its provisions.
A mortgagee is, as already stated, neither a proprietor nor a tenure holder, and a person settled by him on the land does not enjoy the status of a raiyat under sections 5(2) and 5(3).
He is therefore not a person entitled under the terms of the statute to any occupancy rights.
Thus, if the respondents cannot resist the suit for ejectment either by reason of section 76(a) of the Transfer of Property Act or section 21 of the Bihar Tenancy Act, it is difficult to see how they could get such a right as the result of the interaction of both those sections.
In Manjhil Lal Biswa Nath Sah Deo vs Mahiuddin(1), the suit was by a mortgagor after redemption to recover possession of lands, which had been leased by the mortgagee.
The proprietor claimed that the lands were zirait; but the finding, however, was that they were raiyat lands, and that the mortgagee had inducted tenants into possession in the usual course of management.
It was held that the tenants could not be ejected.
The decision was expressly based on the fact that the lands were raiyati lands, and the learned Judges distinguished the cases in Mahadeo Prasad Sahu vs Gajadhar Prasad Sahu(2 ) and Jogeshwar Mazumdar vs Abed Mahomed Sirkar (3) on the ground that the lands which were the subject of mortgage therein were zerait lands.
This decision does not support the broad proposition for which the respondents contend, and is really against them, as the mortgage in the present case is of 'kamat ' lands.
In Rajendra Nath vs Dinu Prodhan(4), the facts were (1) (2) (3) (4) A.I.R. 1930 Cal.
16 similar to those in Manjhil Lal Biswa Nath Sah Deo vs Mahiuddin(1), except that the lands do not appear to have been raiyati lands.
In holding that the mortgagor was not entitled to possession, Guha, J. observed that the mortgage deed did not stand in the way of the tenants being settled by the mortgagee, and that when they were so settled, they had well defined rights under the Act, and could not be ejected.
If section 5(3) of the Act did not apply and it would not, unless the letting was by the proprietor or tenureholder it is not stated what other provision of law operated to confer occupancy rights on the tenant.
The learned Judge then referred to Binad Lal Pakrashi vs Kalu Pramanik(2 ) as furnishing the principle on which the decision should rest.
There, a tenant was put into possession by a person who claimed to be the proprietor, and though it subsequently turned out that he was not, it was held that the letting by him conferred on the tenant the status of a raiyat.
As pointed out in Peary Mohun Mondal vs Radhika Mohun Hazra(3) and Krishna Nath Chakrabarty vs Mahomed Wafiz(4) the basis of the decision in Binad Lal Pakrashi vs Kalu Pramanik(2) was that the word "proprietor" in section 5(3) would include a defacto as well as a de jure proprietor, and a tenant who is bona fide inducted into possession by him would have the status of a raiyat.
This decision makes an inroad on the general principle that no one can confer a better right than what he has got, and later decisions have generally shown a disposition to confine its application within narrow limits.
But even on its own ground, it can have no application when the person who admits a tenant is not, as required by section 5 (3), a proprietor de facto or de jure, but a mortgagee.
The principle of the decision in Binad Lal Pakraski vs Kalu Pramanik(2) does not therefore support the conclusion in Rajendra Nath vs Dinu Prodhan(5) that a tenant admitted by a mortgagee into possession acquires the status of a raiyat.
(1) , (2) Cal.
(3) (4) (5)A.I.R. 17 In Pramtha Nath vs Sashi Bhusan(1), a permanent lease was granted by a mortgagee after he had obtained a decree for foreclosure.
Subsequently, that decree was recalled in a suit by the Official Receiver ' representing one of the mortgagors and a fresh decree for redemption was passed.
After redemption, the Official Receiver received rent from the lessee treating him as a tenant on the land.
A transferee from the Official Receiver having subsequently instituted a suit in ejectment against the tenant, it was held that the latter bad acquired a right of occupancy under section 21 of the Act, and that the relief for khas possession could not be granted as against him.
Notwithstanding that some of the observations in the judgment are widely expressed, the ground of the decision really is that when the Official Receiver accepted rent from the tenant, that amounted to an affirmance of the lease by him, and that would have the effect of bringing section 5(3) directly into play and conferring on the tenant the status of a raiyat.
The decisions discussed above do not lay down any acceptable principle that a lease by a mortgagee which is protected by section 76(a) of the Transfer of Property Act, operates by itself to confer a right of occupancy on the tenant under section 21 of the Act.
Some argument was founded by the respondents on the clause in Exhibits 2 and 3 that the mortgagee could get the lands cultivated.
It was contended that this clause conferred authority on the mortgagee to settle raiyats on the lands, and that the tenants admitted in pursuance of this authority would be in the same position as if they had been admitted by the proprietor and the conditions of section 5(3) would be satisfied.
But then, the lands are private lands, and the clause in question is followed by the provision that on redemption the mortgagors would be entitled to resume "sir and khas possession", and that would be rendered nugatory if the deed is construed as authorising the mortgagees to settle tenants on the lands with the status of raiyats.
The authority to get lands cultivated can only mean (1) A.I.R. 1937 Cal. 763.
3 18 getting them cultivated through hired labour as contemplated in the definition of 'private lands '.
We are clearly of opinion that the mortgage deed conferred no authority on the mortgagees to admit tenants so as to confer on them rights of occupancy.
In the result, we must old that the defendants of the second party have failed to establish that they have any rights of occupancy over the suit lands, and that the plaintiffs are accordingly entitled to a decree in ejectment, with future mesne profits as claimed in the plaint.
This appeal is allowed, the decree of the lower court is set aside, and that of the Subordinate Judge of Monghyr restored as against 2nd party defendants with costs throughout.
The suit as against the first party defendants is dismissed, but in the circumstances, there will be no order as to costs.
[/INST]The appellants were the purchasers of the mortgagors ' interests in the agricultural lands in suit and deposited the amounts due on the mortgages in court under section 83 of the Transfer of Property Act, which were withdrawn by the representatives of the mortgagees and the mortgages were redeemed.
They were obstructed in taking khas possession of the lands by tenants who were recorded as "settledraiyats" in the finally published record of rights and brought the suit for recovery of possession from the tenants and, alternatively, for damages against the representatives of the mortgagees.
The subordinate Judge found that the lands were the private lands of the proprietors and the tenants were inducted not by them but by the mortgagees in possession by a lease for a term which was neither bona fide nor binding on the appellants and passed a decree in ejectment.
On appeal, the High Court held that the lands were not the private lands of the mortgagors, the lease was bona fide and the recognition of the lessees as tenants by the mortgagees conferred on them rights of occupancy in the suit lands and dismissed the suit.
The respondents relied on the presumptions under sections 103 B and 120(2) of the Bihar Tenancy Act and contended that the recognition by the mort gagees of their tenancy right had the effect of conferring on them the rights of occupancy under the Act.
Held, that an entry in the record of rights published under section 103 A of the Bihar Tenancy Act does not create rights but merely raises a presumption under section 103 B of the Act that such Tights exist, which can be rebutted if it can be shown that the materials on which it was based do not justify it.
Bogha Mower vs Ram Lakhan, ([1917] and Bakub Ali vs Muhammad Ali ([1928] , referred to.
That where, as in the present case, no evidence was produced before the authority who made the record, one has only to produce 2 such evidence as satisfies the court in order to rebut the presumption.
This is equally true with regard to the presumption enacted by section 120(2) of the Act with regard to the proprietor 's private land.
That section 120 of the Bihar Tenancy Act merely enacts certain rules of evidence for determining whether a disputed land is the proprietor 's "private" land.
It does not preclude the proprietor, even if he cannot prove that he cultivated the land as such for 12 years prior to the date of the Act, from adducing other evidence to show that the land is his private land.
Kisho Prashad Singh vs Parmeshri Prasad Singh, ([1923] I.L.R. 2 Pat. 414) and Bindeshwari Prasad Singh vs Kisho Prasad Singh ([1926] L.R. 53 I.A. 164), relied on.
That as the mortgagees were neither proprietors nor tenure holders as defined by the Bihar Tenancy Act, persons inducted by them could not be raiyats within the meaning of section 5(3) of the Act so as to acquire any rights of occupancy under section 21 of the Act.
Mahabir Gope vs Harbans Narain Singh ([1952] S.C.R. 775), applied.
Nor could the provisions of section 76 (a) of the Transfer of Property Act be of any avail.
Assuming that the lease granted by the mortgagees continued even after termination of the period fixed therein, that could confer on the lessees no more than the status of tenants from year to year, in which case, their possession would cease with the termination of the agricultural year during which the mortgages were redeemed.
Rajendra Nath vs Dinu Prodhan (A.I.R. , disap proved.
Binod Lal Pakrashi vs Kalu Pramanik ([1893] I.L.R. 20 Cal.
708), doubted and held inapplicable.
Pramatha Noth vs Sashi Bhusan (A.I.R. , distinguished.
Case law discussed.
Held further, that there is no presumption of genuineness in favour of certified copies of documents under section 90 of the Evidence Act, nor does that section authorise the raising of a presumption as to the existence of authority of an agent to act for another.
Basant vs Brijraj ([1935] L.R. 62 I.A. 180), referred to.
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<s>[INST] Summarize the judgement: Criminal Appeal No. 79 of 1984.
From the Judgment and Order dated 5.10.1983 of the Punjab and Haryana High Court in Criminal Original Contempt Petition No. 27 of 1983.
R.K. Garg, Mahabir Singh and S.Srinivasan for the Appellant.
Kapil Sibal, R.N. Karanjawala, Mrs. M.Karanjawala,and Ejaz Maqbool for theRespondents.
The Judgment of the Court was delivered by DUTT, J.
This appeal under section 19(1) of the Contempt of Courts Act, hereinafter referred to as 'the Act ', is directed against the judgment and order of the Punjab & Haryana High Court dismissing the application for contempt filed by the appellant against Shri Bhajan Lal, who was then the Chief Minister of the State.
In the application for contempt, it was, inter alia, alleged by the appellant that one Shri Devinder Sharma was a Forest Minister in the Council of Ministers headed by Shri Bhajan Lal.
The said Devinder Sharma was defeated in the legislative assembly election held in 1982.
Shri Bhajan Lal, because of his political and personal relations with Shri Devinder Sharma, was personally very keen on giving him an office of profit.
In order to achieve this objective, Bhajan Lal got an Ordinance being Ordinance No. 44 of 1982 promulgated by the Governor.
The Ordinance, inter alia, provided the constitution of a Forest Development Board.
According to the appellant, such Board was constituted with a view to appointing the said Devinder Sharma as its Chairman.
It was further alleged by the appellant that the constitutional validity of the said Ordinance was challenged by twelve Indian Forest Officers including the appellant by filing a writ petition in the High Court.
It was alleged that the respondent, Bhajan Lal, through Shri R.K. Vashisth, the Superintendent of Police, pressurised and threatened the writ petitioners to withdraw the said writ petition and, pursuant to that, eleven officers withdrew from the petition.
It was only the appellant who continued to prosecute the writ petition and, as a consequence of which, the appellant was transferred from the Forest Expert Special Project Cell to the Forest Department, Haryana, on 891 March 18, 1983.
The further allegation of the appellant was that after having failed to threaten and demoralise the appellant through indirect means the respondent, Bhajan Lal, called him to his official residence on July 26, 1983 through the Acting Chief Conservator of Forests and criminally intimidated him to withdraw the writ petition.
Thereafter, the appellant filed an application for contempt against the respondent, Bhajan Lal, in the High Court complaining of interference by the respondent with the due course of judicial proceedings.
The application was admitted and a rule nisi was issued upon the respondent.
The respondent appeared in the rule and opposed the same by filing an affidavit denying all the allegations made against him by the appellant.
The learned Single Judge of the High Court, after considering the application, affidavits and the submissions made on behalf of the parties, took the view that there were circumstances to indicate that it was not a fit case in which the court should exercise its jurisdiction under the Act.
In that view of the matter, the learned Judge dismissed the application and discharged the rule nisi.
It is apparent from the facts stated above that the allegations made by the appellant, if proved would consitute a criminal contempt.
It is also not disputed by the parties that it was a case of criminal contempt as defined in section 2(c) of the Act.
The scope and ambit of this judgment will, therefore, be confined to criminal contempt.
Mr. Sibbal, learned Counsel appearing on behalf of the respondent, has taken a preliminary objection to the maintainability of the appeal under section 19(1) of the Act.
It is contended by him that as no punishment was imposed on the respondent by the High Court in exercise of its jurisdiction to punish for contempt, section 19(1) is inapplicable and the appeal is incompetent.
Section 19(1) provides as follows: "19(1).
An appeal shall lie as of right from any order or decision of a High Court in the exercise of its jurisdiction to punish for contempt (a) where the order or decision is that of a single judge, to a Bench of not less than two Judges of the Court; 892 (b) where the order or decision is that of a Bench, to the Supreme Court.
Provided that where the order or decision is that of the Court of the Judicial Commissioner in any Union territory, such appeal shall lie to the Supreme Court.
" The right of appeal will be available under sub section (1) of section 19 only against any decision or order of a High Court passed in the exercise of its jurisdiction to punish for contempt.
In this connection, it is pertinent to refer to the provision of Article 215 of the Constitution which provides that every High Court shall be a court of record and shall have all the powers of such a court including the power to punish for contempt of itself.
Article 215 confers on the High Court the power to punish for contempt of itself.
In other words, the High Court derives its jurisdiction to punish for contempt from Article 215 of the Constitution.
As has been noticed earlier, an appeal will lie under section 19(1) of the Act only when the High Court makes an order or decision in exercise of its jurisdiction to punish for contempt.
It is submitted on behalf of the respondent and, in our opinion rightly, that the High Court exercises its jurisdiction or power as conferred on it by Article 215 of the Constitution when it imposes a punishment for contempt.
When the High Court does not impose any punishment on the alleged contemnor, the High Court does not exercise its jurisdiction or power to punish for contempt.
The jurisdiction of the High Court is to punish.
When no punishment is imposed by the High Court, it is difficult to say that the High Court has exercised its jurisdiction or power as conferred on it by Article 215 of the Constitution.
It is, however, strenuously urged by Mr. R.K. Garg, learned Counsel appearing on behalf of the appellant, that when the High Court acquits a contemnor after hearing the parties and after considering the facts and circumstances of the case, the High Court does so also in the exercise of its jurisdiction as conferred by Article 215 of the Constitution.
Counsel submits that jurisdiction to punish for contempt includes also the jurisdiction to dispose of the case either by punishing the contemnor or by acquitting him.
In support of the contention much reliance has been placed on behalf of the appellant on a decision of this Court in Smt.
Ujjam Bai vs State of Uttar Pradesh, [1963] 1 SCR 778 wherein S.K. Das, J. observed "jurisdiction means authority to decide." Relying upon the said observation it is submitted by Mr. Garg that the jurisdiction of the High Court to punish for contempt also includes the jurisdiction to decide whether such punishment 893 should be imposed or not and when the High Court comes to the finding that such punishment should not be imposed on the contemnor or that no contempt has been committed by the alleged contemnor and acquits him, such decision of the High Court acquitting the contemnor is made in the exercise of its jurisdiction to punish for contempt.
We are unable to accept this contention.
The said observation, in our opinion, should not be read dehors the context in which it was made.
In that case, the Sales Tax Officer disallowed the claim of the petitioner to exemption from payment of Sales Tax under a certain notification.
An appeal preferred by the petitioner to the Court of the Judge (Appeals), Sales Tax, Allahabad, was dismissed.
The question that came up for consideration before this Court was whether a writ of certiorari could be issued for quashing the order of Assessment on the ground that the authority concerned had erroneously exercised its jurisdiction by not granting exemption to the petitioner.
In that context the said observations was made and which was immediately followed by further observation: "Whenever a judicial or quasi judicial tribunal is empowered or required to enquire into a question of law or fact for the purpose of giving a decision on it, its findings thereon cannot be impeached collaterally or on an application for certiorari but are binding until reversed on appeal.
Where a quasi judicial authority has jurisdiction to decide a matter, it does not lose its jurisdiction by coming to a wrong conclusion whether it is wrong in law or in fact.
" There can be no doubt that whenever a court, tribunal or authority is vested with a jurisdiction to decide a matter, such jurisdiction can be exercised in deciding the matter in favour or against a person.
For example, a civil court is conferred with the jurisdiction to decide a suit; the civil court will have undoubtedly the jurisdiction to decree the suit or dismiss the same.
But when a court is conferred with the power or jurisdiction to act in a particular manner, the exercise of jurisdiction or the power will involve the acting in that particular manner and in no other.
Article 215 confers jurisdiction or power on the High Court to punish for contempt.
The High Court can exercise its jurisdiction only by punishing for contempt.
It is true that in considering a question whether the alleged contemnor is guilty of contempt or not, the court hears the parties and considers the materials produced before it and, if necessary, examines witnesses and, thereafter, passes an order either acquitting or punishing him for contempt.
When the High Court acquits the contemnor, the High Court does not exercise its jurisdic 894 tion for contempt, for such exercise will mean that the High Court should act in a particular manner, that is to say, by imposing punishment for contempt.
So long as no punishment is imposed by the High Court, the High Court cannot be said to be exercising its jurisdiction or power to punish for contempt under Article 215 of the Constitution.
It does not, however, mean that when the High Court erroneously acquits a contemnor guilty of criminal contempt, the petitioner who is interested in maintaining the dignity of the court will not be without any remedy.
Even though no appeal is maintainable under section 19(1) of the Act, the petitioner in such a case can move this Court under Article 136 of the Constitution.
Therefore, the contention, as advanced on behalf of the appellant, that there would be no remedy against the erroneous or perverse decision of the High Court in not exercising its jurisdiction to punish for contempt, is not correct.
But, in such a case there would be no right of appeal under section 19(1), as there is no exercise of jurisdiction or power by the High Court to punish for contempt.
The view which we take finds support from a decision of this Court in Paradakanta Mishra vs Mr. Justice Gatikrushna Mishra; , Right of appeal is a creature of the statute and the question whether there is a right of appeal or not will have to be considered on an interpretation of the provision of the statute and not on the ground of porpriety or any other consideration.
In this connection, it may be noticed that there was no right of appeal under the .
It is for the first time that under section 19(1) of the Act, a right of appeal has been provided for.
A contempt is a matter between the court and the alleged contemnor.
Any person who moves the machinery of the court for contempt only brings to the notice of the court certain facts constituting contempt of court.
After furnishing such information he may still assist the court, but it must always be borne in mind that in a contempt proceeding there are only two parties, namely, the court and the contemnor.
It may be one of the reasons which weighed with the Legislature in not conferring any right of appeal on the petitioner for contempt.
The aggrieved party under section 19(1) can only be the contemnor who has been punished for contempt of court.
For the reasons aforesaid, there is substance in the preliminary objection raised as to the maintainability of the appeal.
In our view the appeal is incompetent and is, accordingly, dismissed.
There will, however, be no order as to costs.
H.S.K. Appeal dismissed.
[/INST]A car owned by a firm was entrusted to Guru, proprietor of M/s Auto Electrical Works, for electrical repairs.
The car was insured with M/s. Oriental Insurance Co. Ltd. as required under the ( 'The Act ').
When Momad Donttach an employee of the repairer, was repairing the car, the respondent No. 1 was knocked down when the car dashed against the said respondent as a result whereof she had to be hospitalised and treated for injuries.
The respondent No. 1 instituted a claim petition under section 110 A of the Act before the Motor Accidents Claims Tribunal, impleading the firm the owner of the car Guru, the repairer, Momad Donttach, the mechanic, and the insurer M/s.
Oriental Insurance Co. Ltd. as respondents.
The respondents contested the petition.
The Tribunal passed its award, allowing a compensation of Rs.90,000 to the respondent No. 1 for the injuries suffered by her, payable jointly and severally by the insurer and all the other respondents.
Aggrieved by the decision of the Tribunal, the insurer and Guru filed appeals before the High Court, which allowed the appeal of the insurer, however, holding that under section 92 A of the Act, the insurer was liable to pay to the extent of Rs.7,500.
Guru 's appeal was dismissed, holding that he and his mechanic Momad Donttach alone were jointly and severally liable to pay the compensation, i.e. the entire sum awarded minus Rs.7,500 above said.
Aggrieved by the decision of the High Court.
Guru moved this Court for relief by special leave.
Allowing the appeal and modifying the order of the High Court, the Court, 171 ^ HELD: The only question of law arising for consideration was whether the insurer was liable to pay the compensation to the claimant, which has to be resolved in the light of the provisions of the Act.
[175 B, C] If a policy is taken in respect of a motor vehicle from an insurer in compliance with the requirements of Chapter VIII of the Act, the insurer is under an obligation to pay the compensation payable to a third party on account of any injury to his/her person, property or to a legal representative of the third party in case of death of the third party caused by use of the vehicle at a public place.
The liability to pay the said compensation arises when the insured is using the vehicle in a public place.
It also arises when the insured has caused or allowed any other person (including an independent contractor) to use his vehicle in a public place and the death of or injury to the person or property of a third party is caused on account of the use of the said vehicle during such period, unless such other person has himself taken out a policy of insurance to cover the liability arising out of such an accident.
[176E ] In this case, neither Guru Govekar, the repairer, nor his mechanic Momad Donttach had taken a policy of insurance covering the liability to pay compensation payable to a third party, when a motor vehicle taken for repairs from its owner has caused the death of or injury to a third party.
When the owner of a Motor vehicle entrusts his vehicle to a repairer to carry out repairs, he is allowing the repairer to use his vehicle in that connection.
It is also implicit in the said transaction that unless there is any contract to the contrary, the owner of the vehicle also causes or allows any servant of the repairer, engaged in the work of repairs to use the vehicle in connection with the work of repairs and when such work of repair is being carried out in a public place, if on account of the negligence of either the repairer or his employee engaged in the repair work, a third party dies or suffers injury to his person or property, the insurer becomes liable to pay the compensation under the provisions of the Act.
While it may be true that under the Law of Torts, the owner may not be liable on the principle of vicarious liability, the insurer would be liable to pay the compensation by virtue of the provisions of sections 94 and 95 of the Act.
On the facts of the case, the insurer was liable to pay the compensation found due to the claimant as a consequence of the injuries suffered by her due to the negligence of the mechanic engaged by the repairer who had undertaken to repair the vehicle, by virtue of the provisions contained in section 94 of the Act.
Any other view will expose the innocent third 172 parties to go without compensation when they suffer injuries on account of such motor accidents and will defeat the very object of introducing the necessity for taking out insurance policy under the Act.
[176H; 177A C; 180F; 181F] The Court allowed the appeal, modified the order of the High Court and directed the insurer to pay to the claimant the sum of Rs.90,000, etc.
[181G] Monk vs Warbey and others, ; McLeod (or Houston) vs Buchanan, ; Vijaynagaram Narasimha Rao and others vs Chanashyam Das Tapadia and others, ; Shantibai and others vs The Principal Govindram C. Sakseria Technological Institute, Indore and others, ; D. Rajapathi vs University of Madurai and others, ; New Asiatic Insurance Co. Ltd. vs Pessumal Dhanamal Aswani and Ors., , referred to.
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<s>[INST] Summarize the judgementON: Civil Appeal No. 2732 of 1980.
From the Judgment and Order dated 25.8.1980 of the Andhra Pradesh High Court in C.R.P. No. 7974 of 1979.
155 A.V. Rangam for the Appellant.
C. Setharamaiah, P.K. Rao, V.A. Babu and K.R. Nagaraja for the Respondents.
The Judgment of the Court was delivered by KANIA, J.
This is an appeal by Special Leave against the judgment of a learned Single Judge of the Andhra Pradesh High Court in Civil ' Revision Petition No. 7974 of 1979.
The appellant before us is the tenant and the original respond ent is the landlord who is dead and is represented by his legal representatives.
The premises in question are in Eluru Town in Andhra Pradesh.
The appellant is carrying on business in the name and style of Sri Panduranga Engineering Company.
According to the original respondent (who will hereinafter be referred to as "the respondent") he was the owner of the building in which the said premises situated and hence, the owner of the said premises.
The respondent filed an eviction petition against the appellant on the ground of bona fide requirement as he wanted to set up his eldest son in business by start ing a photo studio in the said premises.
The appellant disputed the correctness of the said claim.
The appellant in his counter to the eviction petition, inter alia, alleged that the said property in which the said premises were situated was the absolute endowed property of punyamurthula vari Choultry of which the original respondent was the de facto trustee and that the original respondent had no per sonal or proprietary interest in the said property.
He asserted that the said property belonged to the said Choul try and that the original respondent had no manner of right to evict the appellant on the ground of personal use and occupation.
The appellant asserted that the said premises were not the individual property of the original respondent but trust property.
The respondent filed a rejoinder denying that the said premises were the endowed property or that the said property was a part of punyamurthulavari Choultry.
He asserted that he was the absolute owner of the said property which was purchased by his father under a registered sale deed dated 29th June, 1908.
The respondent submitted that the appellant had denied his title and, as the said denial was not bona fide, the appellant was liable to be evicted also on the ground of denial of title of the landlord.
The Rent Controller passed a decree for eviction on the ground that the bona fide requirement of the landlord respondent was made out and also on the ground that the appellant tenant had denied the title of respondent landlord which 156 denial was not bona fide.
The appellant preferred an appeal against the said decision to the Appellate Authority.
The Appellate Authority, however, dismissed the appeal upholding both the grounds of eviction found by the Rent Controller.
Against this decision, the appellant preferred a revision petition to the High Court.
The High Court in its impugned judgment upheld the order of eviction only on the ground of denial of title which was not a bona fide denial.
It is this decision of the High Court which is challenged before us.
The finding that the denial of title was not bona fide, is essentially a finding of fact and, fairly enough, no dispute has been raised by learned counsel for the appellant in respect of that finding.
It is, however, submitted by him that in order to constitute a ground for eviction the denial of title .must be anterior to the filing of the eviction petition and a denial of title in the course of eviction petition would not constitute a ground for eviction.
He drew our attention to the provisions of section 10 of the Andhra Pradesh Buildings (Lease, Rent and Eviction) Control Act, 1960 (hereinafter referred to as "the A.P. Rent Act").
The A.P. Rent Act was enacted with a view to consolidate the law relating to regulation of leasing of buildings, control of rent thereof and prevention of unreasonable eviction of tenants in the State of Andhra Pradesh.
Section 10 of the A.P. Rent Act deals with eviction of tenants.
Sub section (1) of that section prohibits eviction of tenants except in accordance with the provisions of that section or sections 12 and 13 of that Act.
The relevant part of sub section (2) of section 10 of the A.P. Rent Act runs as follows: "(2) A landlord who seeks to evict his tenant shall apply to the controller for a direction in that behalf.
If the Controller, after giving the tenant a reasonable opportunity of showing cause against the application, is satisfied; (i) x x x x (ii) x x x x (iii) x x x x (iv) x x x x (v) x x x x (vi) that the tenant has denied the title of the land lord or claimed a right of permanent tenancy and that such denial or claim was not bona fide, the Controller shall make an order directing the tenant to put the landlord in possession of the building and 157 if the controller is not so satisfied he shall make an order rejecting the application.
" It was urged by learned counsel for the appellant that the ground for eviction must come into existence before the application to the Rent Controller for eviction is made and hence, a denial of title which can be relied upon by the landlord respondent for eviction must be.
anterior to the eviction petition.
In support of his contention, Mr. Rangam, learned coun sel for the appellant placed reliance on the decision of a Bench of this Court in Kundan Mal vs Gurudutta, Judgments Today In that case it has been observed that in providing disclaimer as a ground for eviction of a tenant in clause (f) of section 13(1) of the Rajasthan Premises (Control of Rent and Eviction) Act, 1950 the Legis lature decided to give effect to the provisions of clause (g) of section 111 of the Transfer of Property Act.
The principle of forfeiture on disclaimer is rounded on the rule that a man cannot approbate and reprobate at the same time.
Since the consequence of applying the rule is very serious, it must be held that the denial of title to has to be clear and in unequivocal terms.
In our view, this decision is hardly of any assistance to learned counsel.
The principle laid down in that case is that, in order to constitute a ground for eviction, the denial of title has to be clear and in unequivocal terms.
In the present case, the facts found show that the denial of title of the respondent by the appellant was in dear and unequivocal terms.
Although it is observed in the said judgment that in providing this ground for eviction, the Legislature of the State of Rajasthan decided to give effect to the provisions of clause (g) of section 111 of the Transfer of Property Act, the judgment nowhere lays down that the denial of title must be anterior to the eviction petition nor does it say that the provisions relating to eviction of tenants under the Transfer of Property Act are applicable to the eviction of tenants under the Rajasthan Rent Act.
In this connection we may point out that it is well settled that the Court hearing a suit or appeal can take into account events which are subsequent to the filing of the suit in order to give appropriate relief or mould the relief appropriately.
Moreover, it is signifi cant that in the present case, the denial of the landlord 's title was not the only ground pleaded in support of the claim for eviction but it was also contended by the respond ent that the appellant was liable to be evicted as the respondent wanted the said premises for his personal bona fide use and occupation.
158 It was argued by learned counsel for the appellant that even accepting that there was a denial of title by the appellant and the result would be only that the respondent landlord became entitled to forfeit the lease and in order to be a ground for eviction in a suit that forfeiture would have to precede the suit or petition for eviction.
It was submitted by him that it was not open to a landlord to take advantage of a denial of title by the tenant in the very proceedings for eviction in the course of which the denial was made.
The denial must be anterior to the eviction pro ceedings.
In support of this argument learned counsel placed reliance on the decision in Maharaja of Jeypore vs Rukmani Pattamahdevi, 46 I.A. 109; AIR 1919 P.C. 1.
In our view, this argument also does not stand scrutiny.
In V. Dhanapal Chettiar vs Yesodai Arnrnal, ; a Constitution Bench of this Court comprising seven learned Judges held that in the matter of determination of tenancy the State Rent Acts do not permit a landlord to snap his relationship with the tenant merely by serving on him a notice to quit as is the position under the Transfer of Property Act.
The landlord can recover possession of the property only on one or more of the grounds enacted in the relevant section of the Rent Acts.
Even after the termination of the contractual tenancy the landlord under the definitions of landlord and tenant contained in the Rent Acts, remains a landlord and a tenant remains a tenant because of the express provision made in the enactments that a tenant means 'a person contin uing in possession after the termination of the tenancy in his favour '.
Yet another important feature of the Rent Acts is that either by way of a non obstante clause or by neces sary implication these enactments have done away with the law contained in section 108 of the Transfer of Property Act dealing with rights and liabilities of the lessor and the lessee.
The difference between the position obtaining under the Transfer of Property Act and the Rent Acts in the matter of determination of a lease is that under the former Act in order to recover possession of the leased premises determi nation of the lease is necessary because during the continu ance of the lease the landlord cannot recover possession of the premises while under the Rent Acts the landlord becomes entitled to recover possession only on the fulfilment of the conditions laid down in the relevant sections.
He cannot recover possession merely by determining the tenancy.
Nor can he be stopped from doing so on the ground that he has not terminated the contractual tenancy.
In the case before us, we find that the denial of landlord 's title by the tenant has been expressly made a ground for eviction under section 10(2)(vi) of the A.P. Rent Act which we have already set out earlier.
In view of this, the entire basis for the argument that the denial of title must be anterior to the proceedings for eviction under the A.P. Rent 159 Act is knocked out.
In our opinion, the argument of learned counsel for the appellant must, therefore, be rejected.
We find, on the other hand, that a number of High Courts have taken the view that even a denial of the landlord 's title by a tenant in a written statement in an eviction petition under the Rent Act concerned furnishes a ground for eviction and can be relied upon in the very proceedings in which a written statement containing the denial has been filed (See: Sada Ram and Others vs Gajjan Shiama, AIR 1970 Punjab & Haryana 511; Shiv Parshad vs Smt.
Shila Rani, AIR 1974 H.P. 22 and Machavaram Venkata Narayana Rao vs Sarvepalli Nara yana Rao Sarada and another, As ob served by the Punjab and Haryana High Court to insist that a denial of title in the written statement cannot be taken advantage of in that suit but can be taken advantage of only in a subsequent suit to be filed by the landlord would only lead to unnecessary multiplicity of legal proceedings as the landlord would be obliged to file a second suit for eject ment of the tenant on the ground of forfeiture entailed by the tenant 's denial of his character as a tenant in the written statement.
It was submitted by learned counsel for the appellant that, in any event, the respondent failed to apply for amendment of his plaint and incorporate the ground of denial of title therein as he was bound to do so in order to get relief on that ground which had arisen after the eviction petition was filed.
We agree that normally this would have been so but, in the present case, we find that the Trial Court, namely, the Rent Controller, framed an issue as to whether the tenant 's denial of the landlord 's title to the schedule property including the said premises was bona fide.
The parties went to trial on this clear issue and the appel lant had full knowledge of the ground alleged against him.
It was open to him to have objected to the framing of this issue on the ground that it was not alleged in the eviction petition that the appellant had denied the title of the respondent and that the denial of title was bona fide.
If he had done that the respondent could have well applied for an amendment of the eviction petition to incorporate that ground.
Having failed to raise that contention at that stage it is not open now to the appellant to say that the eviction decree could not be passed against him as the ground of denial of title was not pleaded in the eviction petition.
No other argument have been advanced before us.
In the result, the appeal fails and is dismissal with costs.
S.K.A. Appeal dis missed.
[/INST]These two appeals were preferred against the decision of the Nagpur High Court in an appeal under 'section 19(1)(f) of the Defence of India Act, 1939, modifying an award of compensation made 1178 under section 19(i)(b) of that Act in respect of certain premises requisitioned by the Government under 75(A) of the Rules framed under the Act.
Both the parties applied for and obtained leave to appeal to the Federal Court under sections 109 and 110 of the Code of Civil Procedure.
A preliminary objection was taken on behalf of the Government that the decision of the High Court was an award and not a judgment, decree or order within the meaning of sections 109 and 110 of the Code and as such no appeal lay therefrom : Held, that the objection must prevail and both the appeals stand dismissed.
There could be no doubt that an appeal to the High Court under section 19(1)(f) Of the Defence of India Act from an award made under section 19(i)(b) of that Act was essentially an arbitration proceeding and as such the decision in such appeal cold not be a judgment, decree or order either under the Code of civil procedure or under Cl. 29 Of the Letters patent of the Nagpur High Court.
Kollegal Silk Filatures Ltd. vs province, of Madyas, I. I,.
R. , approved.
There is a well recognised distinction between a decision given by the Court in a case which it 'hears on merits and one given by it in a proceeding for the filing of an award.
The former is a judgment, decree or order of the Court appellable under the general law while, the latter is an adjudication of a private individual with the sanction of the Court stamped on it and where it does not exceed the terms of the reference, it is final and not appealable.
There can be no difference in law between an arbitaration by agreement of parties and one under a statute.
A referrence to arbitration under a statute to a court may be to it either as a court or as an arbitrator.
If it is to it as a court, the decision is a judgment, decree or order appealable under the ordinary law unless the statute provides otherwise, while in the latter case the Court functions as a persona designata and its decision is air award not appealable under the ordinary law but only under the statute and to the extent provided by it.
An appeal being essentially a continuation of the original proceedings, what *as at its inception an arbitration proceeding must retain its character as an arbitration proceeding even where the statute provides for an appeal, Rangoon Botatung Company vs The Collecter , Rangoon (1912) L.R. 39 I.A. 197 .The special officer sales the building sites Dassabhai Beznoji, Bom 506 the special officer sales the Building sites vs Dassabhai Bozanji Motiwala Manavikram Tirumalpad vs the Collector of the Nilagrie, Mad 943 and secretary of state for India in council vs Hindustan Co operative Insurance society Limited ,(1931) L.R. 58 I. A 259 relied on.
National Telephone Company Limited vs Postmaster General, , explained.
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<s>[INST] Summarize the judgementil Appeals Nos. 62 and 63 of 1953.
Appeals under Article 132 (1) of the Constitution of India from the Judgment and Order dated 22nd December, 1952, of the High Court of Judicature at Patna (Ramaswami and Sarjoo Prosad JJ.) in Miscellaneous Judicial Cases Nos. 238 and 242 of 1952.
P. R. Das (J. C. Sinha and L. K. Chaudhry, with him) for the appellant in both the appeals.
M. C. Setalvad, Attorney General for India (L. N.Sinha and Bajrang Sahai, with him) for the respondents in both the appeals.
April 17.
The Judgment of the Court was delivered by section R. DAB J.
721 DAS J.
This judgment disposes of Civil Appeals No. 62 of 1953 and No. 63 of 1953 which have been heard together.
The Motipur Zamindari Company Ltd., the appellant in Civil Appeal No. 6.) of 1953, was incorporated in 1932 under the Indian Companies Act and has its registered office in Bengal.
It supplies sugar cane to a sister concern named Motipur Sugar Factory Ltd. Raja Jankinath Roy and Narendra Nath Roy and Co., Ltd., the appellant in C. A. No. 63 of 1953, was incorporated in 1933 under the Indian Companies Act and also has its registered office in Bengal.
This company owns Zamindari Properties in Purnea in the State of Bihar as well as in Malda in the State of West Bengal.
It carries on business, amongst others, as banker and financier.
On the 30th December, 1949, a bill entitled the Bihar Land Reforms Bill was passed by the Bihar Legislature and having been reserved for the consideration of the President received his assent on the 11th September, 1950.
The Act so passed and assented to was published in the Bihar Gazette on the 25th September, 1950, and was brought into force on the same day by a notification made by the State Government in exercise of powers conferred on it by section 1(3) of the Act.
Many of the proprietors and tenure holders of Zamindari estates took proceedings against the State of Bihar for appropriate orders restraining the State Government from taking over the estates under the provisions of the Act which they claimed to be beyond the legislative competency of the Bihar Legislature and otherwise void.
On the 12th March, 1951, a Special Bench of the Patna High Court held that the Act was unconstitutional on account of its contravention of article 14 of the Constitution.
The State of Bihar appealed to this Court.
Pending that appeal, the provisional Parliament passed the Constitution (First Amendment) Act, 1951.
The respondents in the main appeal took proceedings in this Court, contending that the Act amending the Constitution was invalid.
This 722 Court however, on 5th October, 1951, upheld the validity of the amending Act.
On 6th November, ' 1951, notifications were issued under section3 of the Bihar Act declaring that certain Touzies belonging to the appellants specified in the notification had passed to and become vested in the State.
Both the appellants made separate applications to the Patna High Court under article 226 of the Constitution praying for mandamus or suitable direction or order restraining the respondent from taking possession of their respective estates or tenures by virtue of the said notifications and for other ancillary reliefs.
The appeals filed by the State of Bihar against the order of the Special Bench declaring the Act to be void came up for hearing before this Court and this Court upheld the validity of the Act, except as to a few provisions mentioned in the majority judgment which were hold to be severable.
Thereafter, the two applications made by the two appellants under article 226 before the Patna High Court came up for hearing and were dismissed by a Bench of that Court on the 22nd December, 1952.
The present appeals have been filed with leave of the Patna High Court against the said dismissal.
The question raised before the High Court was whether the Act was, on its true construction, intended to apply to Zamindari estates of companies incorporated under the Indian Companies Act.
In support of the appellants ' contention that it was not, it was urged that the Bihar Legislature had no authority to legislate with respect to trading corporations or non trading corporations whose objects were not confined, to one State.
Reference was made to entries 43, 44 and 45 of List I to show that it was Parliament alone which was authorized to make law with respect to matters set forth in those entries.
The contention was that the Bihar Legislature in enacting the Act invaded the Union field and so the Act was invalid.
This argument was sought to be reinforced by reference to the provisions of the Act and the winding up provisions of the Companies Act.
The Patna High 723 Court overruled this contention and Mr.P.R.Das appearing in support of these appeals has not challenged this part of the decision of the Patna High Court.
The main point urged by Mr. P. R. Das is that even if the Bihar Legislature could make a law for acquiring Zamindari estates of incorporated companies it did not, by the Act, in fact do so.
Section 3 authorises the State Government to declare by notification that the estates or tenures of a proprietor or tenure holder have passed to and become vested in the State.
It will be recalled that it was under this section that the State Government on the 6th November, 1951, issued the notifications with respect to the estates of the appellants situate within the State.
Mr. P. R. Das 's principal contention is that the appellant companies do not come within the terms, " proprietor" or " tenure holder" as defined by the Act and consequently no part of their estates were intended 'to be vested or did in fact vest in the State.
" Proprietor" is defined by section 2(o) as meaning a person holding in trust or owning for his own benefit an estate or a part of an state and includes the heirs and successors in interest of a proprietor and, where a proprietor is a minor or of unsound mind or an idiot, his guardian, committee or other legal curator.
Tenure holder is defined by section 2 (r) as meaning a person who has acquired from a proprietor or from any tenure holder a right to hold land etc.
The argument is that the word "person" in the two definitions referred to above does not, in the context of the Act, include a company.
It is conceded that under section 4(40) of the Bihar General Clauses Act the word "person" would ordinarily include a company, but it is urged by Mr. P.R. Das that the definitions given in that section apply only where there is nothing repugnant in the subject or context.
His contention is that the definition of "proprietor" and "tenureholder" indicates that a company which owns Zamindaries is not covered by that definition.
We are unable to accept this contention.
It is not disputed 94 724 that a company can own an estate or a part of an estate and, indeed, the appellant companies are fighting these appeals only to protect the estates they own.
Therefore, they come within the first part of the definition.
The definition after stating what the word means proceeds to state what else the definition would include under certain specified circumstances, namely, the heirs and successor in interest etc.
The word "heir" certainly is inappropriate with regard to a company, but there is nothing inappropriate in the company having a successor in interest.
It is pointed out that there is no provision in the definition of proprietor to include the directors, managing agents and, in case of winding up, the liquidator of the company.
This circumstance does not appear to us to be a cogent reason for holding that the word "proprietor" as defined does not cover a company.
It is to be noted that the agent or, in case of insolvency, the official assignee or receiver of an individual proprietor are also not included in the definition.
Reference to proprietor who is a minor or of unsound mind or an idiot and his guardian etc.
, was obviously necessary because those proprietors suffer from legal disabilities.
Mr. P. R. Das refers us to various sections and rules framed under section 43 of the Act to show that ' only natural persons were intended to be affected by the Act, because, ha urges, the company is not competent to do the acts therein referred to.
It is not ,disputed by Mr. P. R. Das that there is no difficulty on the part of an incorporated company to do all these acts by its directors or managing agents or other officers empowered in that behalf by its articles of association, but his contention is that the provisions of the Indian Companies Act should not be imported into the consideration of the provisions of his Act.
He relies primarily on the case of Pharmaceutical Society vs The London and Provincial Supply Association, Limited(1) whore it was held,that a corporation (1) 725 did not come within the word "person" used in the Pharmacy Act, 1868 (31 & 32 Vic., Chapter 121).
Reliance was placed upon the observations of Lord Selborne L.C. at page 863.
The preamble to that Act recited, amongst other things, that it was "expedient for the safety of the public that persons keeping open shop for the retailing, dispensing or compound ing of poisons, and persons known as chemists and druggists should possess a competent practical knowledge of their business.
" This clearly comtemplated persons skilled in matters pharmaceutical and not impersonal corporate bodies which would know nothing about that particular business.
Indeed, Lord Blackburn in his speech in the House of Lords in the Pharmaceutical Society 's case(1) referred to this preamble and observed at page 870: "Stopping there, it is quite plain.
that those who used that language were not thinking of corporations.
A corporation may in one ' sense, for all substantial purposes of protecting the public, possess a competent knowledge of its business,, if it employs competent directors, managers, and so forth.
But it cannot possibly have a competent knowledge in itself.
The metaphysical entity, the legal 'person ', the corporation, cannot possibly have a competent knowledge.
Nor I think, can a corporation be supposed to be a 'person known as a chemist and druggist '.
" His Lordship then referred to the provisions of sections 1 and 15 of that Act and came to the conclusion that the word "person" in that Act.
meant a natural person.
The effect of 'that case is that whether the word "Person" in a statute can be treated as including a corporation must depend on a consideraiion of the object of the statute and of the enactments passed with a view to carry that object into effect.
In view of the object of that Act as recited in the preamble there could be no manner of doubt that the word "person" in that Act could not possibly, include a corporation.
Lord Selborne towards the end of page 863 indicated, by reference to the 18th (1) (188o) L.R. 5 App.
857 726 section, that the legislature by the word "person" referred only to individual persons as it was clearly repugnant to the subject of that Act to include a corporation within the word "person" as used in 'that Act.
Mr. P. R. Das urges that the judgment of Lord Selborne was founded on the fact that the corporation could not come within the term "person" on the ground that it could not make an application in writing signed by it.
From this Mr. P. R. Das urges that the necessary implication of this part of the judgment of Lord Selborne is that it was not permissible to take the provisions of the Companies Act into consideration for construing another Act.
If that were the implication of the speech of Lord Selborne, with respect, we are unable to accept the same.
Indeed, one cannot think of a company unless one has in view the provisions of the Companies Act, for a company is the creature of the Companies Act.
Its existence, powers and rights are all regulated by that Act.
The trend of the, speeches of the noble Lords in the case relied on by Mr. P. R. Das is that the object of the particular Act under consideration was entirely repugnant to the word "corporation" being included within the term "Person" as used in that Act, and as we apprehend it, that decision lays down nothing beyond that.
In support of his contention that a company owning an estate was never intended to be affected by the Act, Mr.P. R. Das draws our attention to the winding up sections of the Indian Companies Act and urges that it is not possible to fit in the scheme of winding up into the scheme of the Bihar Act.
If the Zamindari assets of the company are taken over and compensation is paid by non transferable bonds it will, he contends, be impossible, to apply the law of winding up in case the company goes into liquidation.
There will, according to him, be conflict of jurisdiction between the Court where the winding up is proceeding, which may conceivably be in another State, land the Bihar Government and its officers. 'We see no force in this contention.
Upon a 727 notification being issued under section 3, the Zamindari estate will vest in the State and the company will cease to have any interest in it.
Its only right will be to receive compensation.
In case of winding up the liquidator will have to pursue the remedy provided by this Act.
He or the company will be in no worse position than the official assignee or official receiver of an individual proprietor who may happen to become insolvent in another State.
Finally, Mr. P. R. Das strongly relies on section 41 of the Act and contends that that section would be wholly inapplicable to a company and that circumstance by itself would indicate that the Bihar Legislature did not intend that a company owning an estate should be governed by this Act.
A corporation, it is true, cannot be made liable for treason, felony or any misdemeanour involving personal violence or for any offence for which the only penalty is.
imprisonment or corporal punishment.
(Halsbury, 2nd Edition, Volume IX, article 5, p. 14).
Section 41 does not prescribe punishment by imprisonment only.
Mr. P. R. Das suggests that the infliction of imprisonment or fine would depend upon the gravity of the offence and not on the character of the offender.
This argument, however, would seem to run counter to the opinion of Lord Blackburn set forth at pages 869 870 of the report of the very case relied on by Mr. P. R. Das.
The recent cases of Director of Public Prosecutions vs Kent and Sussex Contractors Limited(1) and Rex vs I.C.B. Haulage, Limited and Another(2) seem to indicate that a corporation may be convicted even of an offence requiring an act of will or a state of mind.
Apart, however, from the consideration whether a company may be held guilty of wilful failure or neglect, as to which we need not express any definite opinion on this occasion, there can be no difficulty in applying the provisions of section 41 to the officers or agents of the company.
On a notification under section 3(1) being published the estate vests in the State.
Section 4 sets out the (1) [1944] I.K.B. 14 6.
(2) [1944] I.K.B. 551.
728 consequences of such vesting.
Clause (g) of that section empowers the Collector by written order served in the prescribed manner to require any person in possession of.
such an estate or tenure or any part thereof to give up possession of the same by a date specified in the order and to take such steps or use such force as may be necessary for securing compliance with the said order.
If any officer or agent of the company in the possession of the estate wilfully fails or ignores to comply with such lawful order, then surely he can be proceeded against under section 41.
Likewise, under section 40, the.
officers therein mentioned are authorized at any time before or after the date of vesting by a written order served in the prescribed manner to require a proprietor or tenureholder or any other person in possession of such an estate or tenure or any agents or employees of such proprietor, tenure holder or other person to produce at a time and place specified in the order such documents, papers or registers or to furnish such informa tion relating to such estate or tenure as such officer may from time to time require for any of the purposes of this Act.
A wilful failure or neglect to comply with such order would clearly bring the recalcitrant officer or agent of the company within the penalty provided under section 41.
Section 41 therefore, does not necessarily preclude the application of the Act to incorporated companies.
It cannot be denied that a company is competent to own and hold property.
The whole.
object of the impugned Act is thus stated by Mahajan J. in the State of Bihar vs Kameshwar Singh(1): " Now it is obvious that concentration of big blocks of land in the hands of a few individuals is contrary to the principle on which the Constitution of India is based.
The purpose of the acquisition contemplated by the impugned Act therefore is to do away with the concentration of big blocks of land and means of production in the hands of a few individuals and to so distribute the ownership and control of the (1) at p. 941.
729 material resources which come in the hands of the State as to subserve the common good as best as possible.
In other words, shortly put, the purpose behind the Act is to bring about a reform in the land distribution system of Bihar for the general benefit of the community as advised.
" In view of this, purpose there is no reason to differentiate between an individual proprietor and a company which owns estates or tenures.
Indeed, there is not only nothing repugnant in the subject or context of the Act which should prevent the inclusion of a company owning estate within the definition of "proprietor", such inclusion is necessary in order to give full effect to the very object of the Act.
In Appeal No. 63 of 1953 Mr. P. R. Das raises an additional point, namely, that the appellant company in that appeal owns estates which are situate in Purnea in the district of Bihar and in Malda in the district of West Bengal but it has to pay a single Government revenue at Purnea.
It is further alleged that the appellant company has let out portions of the estates on Patni leases, each of the Patnis comprising land situate both within and outside Bihar.
The acquisition of that part of the estate, which is situate in Bihar has made it difficult, if not impossible, for the appellant company to pay its revenue or recover its rent.
That part of the estate which is in Bihar cannot be severed from the rest and therefore the notification covering only the portion of the estate situate in Bihar is invalid.
We do not think there is any substance in this argument.
As stated by the High Court it is a simple case of apportionment of the revenue and also apportionment of the rent.
The necessity for such apportionment cannot possibly affect the validity of the notification.
For reasons stated above these appeals fail and must be dismissed with costs.
Appeals dismissed.
[/INST]The word " person " in the definitions of " proprietor "" and tenure holder " contained in a. 2 (o) and section 2 (r) respectively of the Bihar Land Reforms Act, 1950, includes companies incorporated under the Indian Companies Act, 1913.
There is nothing repugnant in the subject or context of the Act to prevent the inclusion of a company within the terms proprietor " and " tenure holder ".
On the contrary such inclusion is necessary in order to give full effect to the object of the Act.
Pharmaceutical Society vs The London and Provincial Supply Association, Limited distinguished.
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<s>[INST] Summarize the judgementCTION: Civil Appeal No. 460 of 1970.
Appeal by special leave from the judgment and order dated May 20, 1969 of the Allahabad High Court in Special Appeal No. 1177 of 1968.
M. C. Chagla and R. Gopalakrishnan, for the appellant.
V. A. Seyid Muhammad, P. C. Chandi, B. D. Sharma and section P. Nayar, for the respondents.
The Judgment of the Court was delivered by Grover, J.
This is an appeal by special leave from a judgement of the Allahabad High Court dismissing a writ petition by which the appellant challenged the validity of a warrant issued by the Assistant Collector, Central Excise, Allahabad, authorising the Superintendent Central Excise, Varanasi, to enter certain premises, search the same and seize the documents therefrom.
The appellant, which is a public limited company having its registered office at Calcutta, owns and runs a factory known as Sahu Chemicals and Fertilisers at Varanasi where chemicals such 94 as ammonia and soda ash are manufactured.
In February 1962 excise duty was fixed on manufacture of ammonia for the purpose of fertilisers at Rs. 25/ per metric ton, the rate being Rs. 125/ per metric ton if it was used for other purposes.
The notification by which the aforesaid duty was payable was later withdrawn by means of another notification dated March 1, 1964 and thereafter no excise duty was required to be paid on the manufacture of ammonia.
For the period from May 1962 to the beginning of March 1964 the appellant had paid duty at the rate of Rs. 25/ per metric ton on the ground that ammonia had been utilised for the purpose of manufacture of chemical fertiliser.
The Central Excise authorities, however, had received information that part of the ammonia had been utilised for purposes other than the manufacture of fertilizers on which higher duty of Rs. 125/ per metric ton was payable.
It was considered that there had been evasion of duty.
On May 11, 1968, the Assistant Collector issued a warrant for the search and seizure of goods and documents pursuant to which the premises of the factory at Varanasi were searched on May 11, 12 and 13, 1968 and various documents were seized.
The writ petition was heard in the first instance by the learned single judge who dismissed it.
In appeal his judgment was upheld by the Division Bench.
Three contentions were raised before the Division Bench; the first was that section 1.2 of the , hereinafter called, the "Act" was void as the powers delegated to the Central Government by the legislature were excessive and beyond permissible limits.
The second point was that the having been repealed it was not open to the Central Government under section 12 of the Act to apply section 105(1) of the to the Act and the notification dated May 4, 1963 by which this was done was illegal and ultra vires.
The, third was that the search and seizure made by the respondents under the impugned authorisation dated August 11, 1968 and the authorisation itself were not in accordance with the provisions of section 105 of the .
Section 12 of the Act is in the following terms: section 12.
Application of the provisions of Act VIII of 1878 to Central Excise Duties.
The Central Government may, by notification in the official Gazette declare that any of the provisions of the relating to the levy on and exemption from customs duties, drawback of duty, warehousing offences and penalties, confiscation, and procedure relating to offences and appeals, shall, with such modifications and alterations as it may consider necessary or desirable to adapt them to the circumstances, be applicable in regard to 95 like matters in respect of the duties imposed by section 3.
" When the Act was enacted section 172 of the which could be applied to the Act under section 12 provided : S.172.
"Any Magistrate may, on application by a Customs Collector, stating his belief that dutiable or prohibited goods (or any documents relating to such goods) are secreted in any place within the local limits of the, jurisdiction of such Magistrate, issue a warrant to search for such goods.
Such warrant shall be executed in the same way and shall have the same effect, as a search warrant issued under the law relating to Criminal Procedure.
" It may be mentioned that the words "or documents" were inserted by the Sea Customs Amendment Act 1955.
After the enactment of the by the notification dated May 4, 1963 as amended by the Notification dated February 6, 1965 amongst other provisions of the , sub section (1) of section 105 and section 1, IO were made applicable with certain modifications of a minor nature under section 12 of the Act.
The material part of these sections are reproduced below ; "section 105(1) Power to search premises. (1) if the Assistant Collector of Customs, or in any area adjoining the land frontier or the coast of India an officer of Customs specially empowered by name in this behalf by the Board, has reason to believe that any goods liable to confiscation or any documents or things which in his opinion will be useful for or relevant to any proceeding under this Act are secreted in any place, he may authorise any officer of customs to search or may himself search for such goods, documents or things." "section 110(3).
The proper officer may seize any document or things which, in his opinion, will be useful for, or relevant to, any proceeding under this Act.
" On the first point it has been urged on behalf of the appellant that section 12 of the Act gave unrestricted and unlimited power to the Central Government to modify or alter the provisions of the and to apply the provisions of that Act with such modifications and alterations as the Central Government might consider appropriate.
Modification, it has been pointed out, may be permissible, and may not fall within the vice of excessive delegation because the basic structure is not changed but alteration, it is suggested, has a much wider connotation and it emm 96 braces even the changing of the essential pattern of a thing or object.
Such a power inherently involves the making of changes even in regard to matters pertaining to legislative policy.
In our opinion the above contention is purely of academic interest in the present case.
In the notifications which were issued applying, inter alia, section 105 (1) and section 1 10 of the no such changes have been made as can possibly fall within the meaning of the word "alterations".
It has been pointed out in the previous decisions of this Court that the power to restrict and modify does not import the power to make essential changes.
It is confined to alterations of a minor character and no change in principle is involved.
See In re Delhi Laws Act, 1912.(1) It was conceded before the High Court and has not been urged before us that the word "modifications" could not be taken as con ferring on the Central Government any legislative power which was in excess of the permissible limits.
Objection was taken only with regard to the word "alterations" but that word must be understood in the sense in which it was open to the legislature to employ it legitimately and in a constitutional manner.
No question is thus involved of delegation either of any essential legislative functions or any change of legislative policy.
The second contention has hardly any merit.
Section 8(1) of the General Clauses Act provides that where any Central Act repeals and re enacts with or without modification any provision of a former enactment then references in any such enactment or in any instrument to the provision so repealed shall, unless a different intention appears, be construed as references to the provision so re enacted.
By virtue of this provision it cannot be disputed.
that in section 12 of the Act the can be read in place of the .
An attempt has been made to argue that section 12 of the Act empowers incorporation of the provisions of in the Act itself and whenever a notification is issued under it such provisions of the as have been applied become incorporated as in integral part of the Act.
Section 8 of the General Clauses Act would not be applicable to a case of such incorporation and it can only apply if section 12 can be regarded as containing a reference to the provisions of the .
In Secretary of State for Indian in Council vs Hindusthan Cooperative Insurance Society Ltd. (2) it was accepted as a settled rule of construction that where a statute is incorporated by reference into a second the repeal of the first statute does not affect the second.
The law laid down by the Privy Council can have no applicability to the present case.
Section 12 of the Act did not bodily lift, as it were, certain provisions of the and incorporate (1) ; (2) 58 I.A.259.
97 them as an integral part of the Act.
It only empowered the Central Government to apply the provisions of the with such modifications and alterations as might be considered necessary or desirable by the Central Government for the purpose of implementation and enforcement of section 3 of the Act.
No exception could be taken to the view of the High Court that section 12 contained a provision delegating limited powers to the Central Government to draw upon the provisions of the for the purpose of implementing section 3 of the Act.
in The Collector of Customs, Madras vs Nathella Sampathu Chetty & Another(1) this Court examined at length the meaning and effect of incorporation by reference of one statute into another and discussed the Privy Council case referred to before in detail.
Section 8(1) of the General Clauses Act, it was pointed out, 'dealt with reference or citation of one enactment in another without incorporation.
The usual or recognised formulae generally employed to effect incorporation were considered; for instance the words used in section 20 of 53 and 54 Vict.
70 Housing of the Working Classes Act, 1890, the words used were " shall, for that purpose, be deemed to form part of this Act in the same manner as if they were enacted in the body thereof." In 54 and 55 Vict.
19, section 1(3), the language employed was,: "The provisions of section 134 of the said Act (set out in the schedule) shall apply as if they were herein enacted.
" It is unnecessary to mention the other provisions because a comparison of the recognised formulae with the text of section 12 of the Act shows that the provisions of the were not meant to be incorporated in the Act and were only to be applicable to the extent notified by the Central Government for the purpose of the duty leviable under section 3.
Another aspect which has been presented under the second contention is that the impugned notification is bad and stands vitiated because under the previous notification which applies section 172 of the it was a Magistrate who had to bring his judicial mind to bear on the expediency or desirability of issuing a warrant for search whereas under the present notification after the enactment of the it is the Assistant Collector of Customs who performs executive functions and who has been empowered to issue the warrant for search and seizure.
The decision of this Court in Collector of Customs & Excise.
Cochin & Ors.
vs A. section Bava(2) has been sought to be pressed into service in support of the argument that extension of section 105 (1), (1) ; (2) 98 is illegal.
In that case the provisions of section 129 of the had been applied under section 12 of the Act.
Section 129 dealt with the procedure relating to appeals and required an appellant to deposit pending the appeal the duty or penalty imposed and empowered the appellate authority, in its discretion, to dispense with such deposit pending the appeal in any particular case.
There was a provision in the Act itself, section 35, which gave an unfettered right of appeal to a person aggrieved by any decision or order made under the Act.
It was in these circumstances that it was held that section 129 of the could not be made applicable so as to whittle down the substantive right of appeal conferred by section 35 of the Act.
The ratio of that decision can afford no assistance to the appellant in the present case.
By the notification issued under section 12 of the Act after the enactment of , the previous notification under the stood superseded and no question survives with regard to the validity of the notification issued in 1963 and amended in 1965.
On the third point an attempt was made to argue that the Assistant Collector, while issuing the, warrant for search and seizure did not apply his mind to the relevant and necessary facts.
Our attention has been invited to the warrant itself in which the documents have not been particularised or specified but the words certain documents" have been used.
The learned single judge dealt with this matter fully and repelled the contention that there was no relevant material before the authority upon which the belief could be founded in terms of section 105(1) of the by the Assistant Collector.
We find no merit in this contention.
The appeal fails and it is dismissed with costs.
G.C. Appeal dismissed.
[/INST]On July 29, 1945 the predecessor in interest of the appellant mortgaged his house in Ratlam to K for a sum of Rs. 3,100 with possession.
According to the deed of mortgage interest would run on the said sum at Rs. 0 10 0 per cent per annum till realisation.
The period of redemption was two years.
Simultaneously with the mortgage a rent note was executed by and between the parties under which the mortgagor was to continue to Occupy the premises, at a rental of Rs. 20/ per month.
The rent note provided inter alia that if the executant (i.e. mortgagor) made default in payment of two months ' rent the mortgagee would be entitled to get him evicted.
The mortgagee was also entitled to increase or decrease the rent and the executant was to vacate the.
house whenever asked to do so.
K filed a suit on his mortgage in 1954 and a preliminary decree was passed in his favour.
On his death his legal representatives were substituted in his place on record.
For some reason no application for a final decree for sale of the property was made within the period fixed under the Limitation Act.
The application for this purpose made by the executors to the estate of K was dismissed on July 29, 1960 as barred by limitation.
On December 27, 1960 the said executors filed a suit for ejectment of the appellant alleging that the 'rent for the premises had remained unpaid from September 19, 1957 till November 28, 1960.
The trial judge dismissed the suit.
In first appeal the plaintiffs claim was allowed in full.
The High Court in second appeal maintained the decree of the appellate court.
Appeal by special leave was filed in this Court against the High Court 's judgment.
It was contended by the appellants that : (i) The rent note executed simultaneously with the mortgage was a mere device to secure payment of interest and did not represent an independent transaction.
Further it did not create any relationship of landlord and tenant; (ii) The plaintiffs ' right as mortgagee merged in the decree and execution thereof being barred by the laws of limitation the plaintiffs had lost all their rights; (iii) The mortgage being extinguished the mortgagor could not bring a suit for redemption on account of section 28 of the Limitation Act, 1908.
HELD : The appeal must be dismissed.
(1) The contents of the documents executed by the parties showed that the relationship between the parties was not simply that of a mortgagee and mortgagor the creditor also had the rights of a landlord qua his tenant besides other rights conferred on him which were greater than those possessed by an ordinary landlord.
[728 F] In all such cases the leasing back of the property arises because of the mortgage with possession.
It cannot however be held that the mortgagee 724 does not secure to himself any rights under the deed of lease but must proceed on his mortgage in case the amount secured to him under the deed of lease is not paid.
If the security is good and considered to be sufficient by the mortgagee there is no reason why be should be driven to file a suit an his mortgage when be can file a suit for realisation of the moneys due under the rent note.
The position of the creditor is strengthened where as in the present case, the interest on the amount of the mortgagee is not the same as the rent fixed.
If during the continuance of, the security the mortgagee wanted to sue the mortgagor on the basis of the rent note and take possession himself or to induct some other tenant thereby securing to himself the amount which the mortgagor had covenanted to pay, there could be no legal objection to it.
Under the provisions of 0.34 r. 4 of the Code of Civil Procedure he could deprive the mortgagor of his right to redeem excepting by proceeding on his mortgage.
It may be (without a final opinion being expressed on the point) that a mortgagee who secured decree for payment of rent cannot put the property to sale for realisation of the amount decreed, but there cas be no objection to his suing for possession if the rent note entitles him to do so.
So long as the mortgagor has a right to redeem the mortgage fie can always pay off the mortgagee and get back possession.
This position would continue so long as the property is not sold under a final decree for sale under the provisions of 0.
34 C.P.C. [732 D G] Lalchand vs Nenuram, I.L.R. , approved.
Harilal Bhagwanji vs Hemshanker, A.I.R. 1958 Bombay 8, Ramnarain vs Sukhi, A.I.R. 1957 Patna 24, Umeshwar Prasad vs Dwarika Prasad, A.I.R. 1944 Patna 5, Ganpat Ruri vs Mad.
Asraf Ali, A.I.R. 1961 Patna 133 and Jankidas vs Laxminarain, I.L.R. , 'referred to.
(ii) Since the mortgagee had only lost his 'right to recover the money by sale of the mortgaged property, his security otherwise remaining intact, and the mortgagor also continued to have his right to redeem the property, the contention on behalf of the appellant that the rights of the mortgagee merged in the preliminary decree could not be accepted.
[732 H] (iii) If the mortgagee had an independent right on the strength of the rent note which continued to be in force notwithstanding that the period for a final decree for sale had expired, there could be no extinction of his right to sue for possession because of section 28 of the Limitation Act.
[733 C]
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<s>[INST] Summarize the judgementAppeals Nos. 271 272 of 1955.
Appeal by special leave from the judgment and order dated June 19, 1953, of the Calcutta High Court in Income tax Reference Nos. 6 & 7 of 1950.
A.V. Viswanatha Sastri, A. K. Dutt, section K. Kapur and Sukumar Ghose, for the appellant.
C.K. Daphtary, Solicitor General of India, R. Ganapathy Iyer, R. H. Dhebar and D. Gupta, for the respondent.
November 13.
The Judgment of the Court was delivered by VENKATARAMA AIYAR, J.
The appellant was a Hindu undivided family carrying on business as piecegoods merchants in the city of Calcutta.
The present proceedings relate to the assessment of its income for the year 1946 47, the previous year thereto being June 12, 1944, to April 24, 1945.
In the course of the assessment, the appellant filed a petition under section 25 A of the Incometax Act, 1922, claiming that there had been a partition in the family on April 24,1945.
On May 27,1945, the In.
come tax Officer enquired into both these matters, the factum of partition and the quantum of income charge.
able to tax, and pronounced orders thereon on June 30, 1945.
On the petition under section 25 A, he held that the partition was true, and that the family had become divided into five groups.
As regards the income assessable under section 23, the dispute related to six sums aggregating to Rs. 2,30,346 shown in the accounts as the sale proceeds of ornaments.
The case of the appellant with reference to these sums was that at the partition the jewels of the family were sold in six lots, that the price realised therefrom was invested in the business, and that the credits in question related thereto.
The Income tax Officer declined to accept this explanation.
He observed that while the books of the appellant 417 showed that what was sold was ornaments, the accounts of Chunilal Damani to whom they were stated to have been sold, showed sale of gold.
He also pointed out that while the weight of the ornaments according to the partition agreement, exhibit A, was 3422 tolas, the weight of gold which was actually sold to the purchaser was 3133 tolas.
The explanation given by the appellant for this discrepancy was that the jewels in question had come down to the family through several generations, and were not pure.
The Income tax Officer rejected this explanation, because he held that the weight which was actually deducted for impurities in the accounts of the purchaser was almost negligible, and that what was sold was thus pure gold and not gold in old family jewels.
He also remarked that the sales were in round figures of 500 tolas, and that "if the assessee had been taking old ornaments broken or unbroken for sale it is inconceivable that on three occasions out of six he took gold weighing 500 tolas in round figure." He also referred to the fact that there was no list of the family jewels, and that there was nothing in the family accounts to show what jewels were held by the family.
He accordingly held that the story of sale of family jewels was not true, and that the sum of Rs. 2,30,346 represented concealed profits of the business, and he included the said amount in the taxable income.
He also followed it up by an order imposing tax on the appellant under the Excess Profits Tax Act.
The appellant took both these orders in appeal to the Appellate Assistant Commissioner who again went into the matter fully, and observed that the appellant had been changing his version as to the true character of the sales from time to time.
Dealing with the discrepancy of 289 tolas between the weight shown in the partition agreement, exhibit A, and that appearing in the accounts books of Chunilal Damani, he remarked that while the explanation of the appellant before the Income tax Officer was that it was due to alloy and brass in the jewels, before him the position taken up was that it was due to pearls and stones which 53 418 had been removed from the jewels, and that the gold contained in the jewels was pure gold.
He did not accept this explanation as, in his opinion, the jewels which were stated to have been in existence for three or four generations should have contained much more of alloy than was shown in the accounts of the purchaser.
He also considered that the sale of gold in round figures of 250 or 500 tolas was a circumstance which threw considerable doubt as to the truth of the appellant 's version.
In the result, he confirmed the findings of the Income tax Officer, and dismissed the appeals.
Against these orders, the appellant appealed to the Appellate Tribunal.
There, he sought to rely on a certain proceedings book as showing that the family jewels were really broken up, and that what was sold to Chunilal Damani was the gold thus separated.
As this proceedings book forms the real sheet anchor of the appellant 's contention before us, it is necessary to refer to the facts relating thereto in some detail.
On February 20, 1945, the members of the family entered into an agreement, exhibit A, to divide their joint proper.
ties among the five branches, of which it was constituted.
In sch.
B to this document are set out the jewels to be divided, and their total weight is, in round figure, 3422 tolas.
Then we have the proceedings book, and that purports to be a record of the decisions taken by the members of the family from time to time for implementing exhibit A.
The minutes of the meeting held on February 23, 1945, show that the pearls and stones imbedded in the jewels were to be removed and divided among the members, and that a goldsmith called Inderban was engaged for the purpose of breaking up the jewels.
Then we have the minutes of a meeting held on February 28, 1945, and therein, it is recited that the weight of the pearls, stones and copper removed was, again in round figure, 289 tolas, and deducting this out of 3422 tolas being the weight of the jewels set out in exhibit A, the gold which was available for partition was 3133 tolas.
It is recorded that this quantity should be sold in the market and the sale proceeds credited in the capital accounts of the business.
And then we have the last of the proceedings dated April 21, 419 1945, which record that gold weighing 3133 tolas was sold and the price credited in the accounts.
Now, if these minutes are genuine and give a correct picture as to what really took place, they would go a long way to support the version given by the appellant as to how he came by the sums making up a total Rs. 2,30,346.
Quite naturally, therefore, the appellant applied to the Tribunal to receive the proceedings book in evidence, and the ground given in support of the application was that it had been filed before the Income tax Officer but had not been considered by him.
Then the question was raised as to whether the proceedings book was, in fact, produced before the Incometax Officer.
The argument of the appellant was that the decision taken at the meeting dated April 21, 1945, which forms the concluding portion of the book had been translated into English at the instance of the Income tax Officer, the original being in Hindi, that the said translation was marked exhibit B and contained the endorsement of the Officer " Original produced ", and that accordingly the book must have been produced before the Officer.
But the Tribunal was not impressed by this argument.
It observed that the book iselft had not been initialled by the Officer, and that though the minutes of the meeting dated April 21, 1945, were genuine, there was no certainty that when it was shown to the Income tax Officer it was contained in the book now produced, that such minutes could have found a place in another book as well, and that, therefore, the book which was sought to be admitted before it in evidence was not proved to be the book which was produced before the Officer.
It was also of the opinion that the minutes of the previous meetings could not have been shown to the Officer.
It accordingly refused to receive the book in evidence, and relying on the other circumstances mentioned in the order of the Income tax Officer and the Appellate Assistant Commissioner, it held that the sum of Rs. 2,30,346 was not the proceeds of the family jewels sold but secret profits made by the appellant in business.
Another contention raised by the appellant before 420 the Tribunal was that in the proceedings under section 25A, the Income tax Officer had held, after making enquiry, that the partition set up by it was true, and that as according to the appellant, the partition consisted in the division, inter alia, of family jewels weighing 3422 tolas, the Income tax Officer must be held to have decided that the family was in possession of the jewels mentioned in exhibit A and had divided them in the manner set out in exhibit B, and that as that order had become final, it must conclude the present question in favour of the appellant.
The Tribunal repelled this contention on the ground that the order under section 25A only decided that there was partition in the family, and that it had no bearing on the issues which arose for decision in the assessment proceedings.
In the result, both the appeals were dismissed.
Pursuant to an order of the High Court of Calcutta dated December 7, 1950, passed under section 66(2) of the Act, the Tribunal referred the following questions for its Opinion: (1)" Whether the Income tax Appellate Tribunal was bound by the findings of fact of the Income tax Officer relating to the nature and division of the assets of the joint family in question which he arrived at in his enquiry under Section 25A(l) of the Indian Income tax Act ? (2)Whether there was any material or evidence upon which the taxing authorities could legally hold that the amount of Rs. 2,30,346 (Rupees two lakhs thirty thousand three hundred and forty six) represented undisclosed profits of the accounting year in question ? " The reference was heard by Chakravarti, C. J., and Lahiri, J., who by their judgment dated June 19, 1953, answered the first question in the negative and the second in the affirmative.
The appellant then filed an application under section 66A(2) for leave to appeal to this Court, and that having been dismissed, has preferred the present appeals on leave granted by this Court under article 136.
Mr. Viswanatha Sastri, learned counsel for the appellant, raised the following contentions: 421 (1) In view of the order of the Income tax Officer under section 25A, it was not open to the Department to contend that the sum of Rs. 2,30,346 does not represent the value of family jewels.
(2)The finding of the Income tax authorities that the said amount represents concealed profits of business is not supported by legal evidence and is, in any event, perverse.
(3)There is no evidence that the amount in question represents profits of business, and it was therefore not chargeable to tax under the provisions of the Excess Profits Tax Act.
(1)On the first question, the appellant relied on certain observations in the order of the Income tax Officer passed under section 25A as amounting to a decision that the family had the jewels mentioned in exhibit A, and that what was actually divided was only the price received therefor.
Now, when a claim is made under section 25A, the points to be decided by the Income tax Officer are whether there has been a partition in the family, and if so, what the definite portions are in which the division had been made among the members or groups of members.
The question as to what the income of the family assessable to tax under section 23(3) was, would be foreign to the scope of an enquiry under section 25A.
That section was, it should be noted, introduced by the Indian Income tax (Amendment) Act, 1928 (3 of 1928), for removing a defect which the working of the Act as enacted in 1922 had disclosed.
Under the provisions of the Act as they stood prior to the amendment, when the assessee was an undivided family, no assessment could be made thereon if at the time of the assessment it had become divided, because at that point of time, there was no undivided family in existence which could be taxed, though when the income was received in the year of account the family was joint.
Nor could the individual members of the family be taxed in respect of such income as the same is exempt from tax under section 14(1) of the Act.
The result of these provisions was that a joint family which had become divided at the time of the assessment escaped tax altogether.
To 422 remove this defect, section 25A enacted that until an order is made under that section, the family should be deemed to continue as an undivided family.
When an order is made under that section, its effect is that while the tax payable on the total income is apportioned among the divided members or groups, all of them are liable for the tax payable on the total income of the family.
What that tax is would depend on the assessment of income in proceedings taken under section 23, and an order under section 25A would have no effect on that assessment.
It is in this context that we must read the observations in the order under section 25A relied on for the appellant.
In fact, that order does not expressly decide that the family had the jewels mentioned in exhibit A, and that they were converted into cash as claimed by the appellant.
Nor could such a finding be implied therein, when regard is had to the scope of the proceedings under section 25A and to the fact that the order under section 23(3) holding that the sum of Rs. 2,30,346 did not represent the value of the family jewels sold was passed on the same date as the order under section 25A and by the very same officer.
(2)The next question is and that is what was really pressed before us whether the sum of Rs. 2,30,346 represents the price of family jewels sold or whether it is concealed business profits.
That clearly is a question of fact the finding on which is open to attack in a reference under section 66 only if it could be shown that there is no evidence to support it or that it is perverse.
Now, the contention of Mr. Viswanatha Sastri for the appellant is that the finding that it is concealed profits was reached by the Income tax Officer and by the Appellate Assistant Commissioner by ignoring the very material evidence furnished by the proceedings book, and that the Appellate Tribunal had erroneously refused to receive the book in evidence.
This contention raises two controversies: (i) Was the proceedings book which was produced before the Tribunal the book which was produced before the Income tax Officer ? (ii) If it was, were the minutes of the meeting prior to April 21, 1945, relied on by the appellant before the Income tax Officer ? Whatever 423 view one might be inclined to take on the former question, so far as the latter is concerned, it is perfectly plain that they were not.
On May 27, 1947, the enquiry was held on both the petitions under s, 25A and on the quantum of income assessable to tax under section 23(3).
Exhibit D is an extract from the order sheet of the Income tax Officer, and it runs as follows: "Regarding credits amounting to Rs. 2,30,346 6 3 in the a/c.
Udoyaram Bhaniram the representatives state that besides the evidence produced, which are noted below, they are not in a position to produce any further evidence, (i) Account books of the assessee containing the details of the amounts aggregating the aforesaid sum.
(ii) Sale statements rendered by Chunilal Damani,copies of which have been filed.
(iii)Roker of Chunilal Damani containing entries for purchase of gold, sold by the assessee family along with Surajrattan Bagri the accountant of Chunilal Damani.
(iv) Statement of Lakhmichand Bhiwaniwalla and Pannalal Bhiwaniwalla, member of the assessee family.
" This statement is signed by the counsel for the appellant.
It is clear from the above that the proceedings book was not relied on as evidence on the character of the receipts making up the sum of Rs. 2,30,346.
The fact appears to be that the appellant produced the proceedings book in support of his petition under section 25A for the purpose of establishing that there was a completed partition, and relied only on the minutes of the meeting held on April 21, 1945, in proof thereof, and that is why that alone was translated in English and marked as exhibit B. It is also to be noted that there is no reference in the order of assessment by the Income tax Officer under section 23(3) to the minutes of the meetings prior to April 21, 1945, and that they were not even translated, as was the record of the meeting dated April 21, 1945.
The obvious inference is that they were not relied on by the appellant, and were therefore not considered by the Officer.
It is also 424 significant that the order of the Income tax Officer refers to sale of ornaments broken or unbroken.
The story that the gold which was separated from the jewels after removing the pearls and stones was melted and sold in quantities of 250 or 500 tolas, which was the argument pressed before us, was not put forward before him.
It is argued that in the appeal against the order of the Income tax Officer the ground was definitely taken that the proceedings book had been produced before him, and that it was also prominently mentioned in a petition supported by affidavit filed by the appellant.
But the order of the Appellate Assistant Commissioner does not deal with this matter either, and it is inconceivable that he would have failed to consider it if it had been pressed before him.
It is also to be noted that the appellant who had obtained a return of the proceedings book from the Income tax Officer did not file it before the Appellate Assistant Commissioner, nor did he move for its admission in evidence.
Apart from taking the grounds to which we were referred, the appellant appears to have presented his case before the Appellate Assistant Commissioner precisely on the same lines on which lie pressed it before the Income tax Officer.
In view of these facts, we are unable to hold that in refusing to admit the proceedings book as evidence in the appeal, the Appellate Tribunal acted perversely or unreasonably.
Indeed, counsel for the appellant did not contend in the High Court that the Tribunal had acted illegally or unreasonably in refusing to admit the proceedings book in evidence.
That being so, it cannot be said that the finding given by the Tribunal on an appreciation of the facts and circumstances already set out is unsupported by evidence or is perverse.
The position may thus be summed up: In the business accounts of the appellant we find certain sums credited.
The explanation given by the appellant as to how the amounts came to be received is rejected by all the Income tax authorities as untenable.
The credits are accordingly treated as business receipts which are chargeable to tax.
In V. Govindarajulu 425 Mudaliar vs The Commissioner of Income tax, Hyderabad (1), this Court observed: " There is ample authority for the position that where an assessee fails to prove satisfactorily the source and nature of certain amounts of cash received during the accounting year, the Income tax Officer is entitled to draw the inference that the receipts are of an assessable nature.
" That is precisely what the Income tax authorities have done in the present case, and we do not find any grounds for holding that their finding is open to attack as erroneous in law.
(3)Lastly, the question was sought to be raised that even if the credits aggregating to Rs. 2,30,346 are held to be concealed income, no levy of excess profits tax can be made on them without a further finding that they represented business income, and that there is no such finding.
When an amount is credited in business books, it is not an unreasonable inference to draw that it is a receipt from business.
It is unnecessary to pursue this matter further, as this is not one of the questions referred under section 66(2).
In the result, the appeals fail and are dismissed with costs.
Appeals dismissed.
(1) , 810.
[/INST]The appellant, a real estate company, was engaged in the business of letting out its property on lease, Besides it was also rendering various services to its tenants such as electricity and water supply, washing and cleaning, lift services, electrical and sanitary repairs on payment basis.
For rendering these services the appellant company employed a number of workmen.
A dispute arose between the employees and the appellant company with regard to wages, scales of pay, dearness allowance and gratuity.
The State Government re ferred the disputes to Industrial Tribunal for adjudication.
The appellant company contested the reference before the Tribunal by raising a preliminary objection that the alleged dispute was not an industrial dispute and that the reference was barred by Section 19 of the since there was an earlier binding award, based on settlement with the Union, which was not terminated by either parties.
934 By an order dated August 24, 1968 the Tribunal overruled the preliminary objection and gave the award dated March 3. 1969 enhancing the dearness allowance of the employees.
The Tribunal also framed a revised gratuity scheme but did not fix any grades and pay scales of workmen for want of con vincing evidence.
The appellant company filed a writ petition in the High Court challenging the Tribunal 's order dated August 24, 1968 as well as the Award dated March 7, 1969 contending: (i) that the Award was without jurisdiction because the appel lant company was not carrying on 'industry ' and the alleged dispute was not an 'Industrial Dispute ' and that the previ ous Award was not terminated and was still subsisting; (ii) that no dispute was raised between the workmen and the appellant prior to the reference before the Tribunal; and (iii) that the Tribunal did not consider the appellant 's capacity to pay dearness allowance to the workmen.
A single judge of the High Court dismissed the writ petition by rejecting all the contentions.
The appellant filed an appeal against the judgment of the single judge before a Division Bench of the High Court which was also dismissed.
Against the decision of the Division Bench of the High Court the appellant company filed an appeal to this Court, contending: (i) that the High Court was in error in holding that the appellant was an 'industry ' under Section 2(j) of the Act; (ii) that the Tribunal was not competent to make the Award since the earlier Award, which was in the nature of a settlement under Section 2(p), was not terminated in accordance with section 19(2) by giving a formal written notice; (iii) that there was non compliance with the provi sions of Section 19(7) of the Act; and (iv) that the Indus trial Tribunal was in error in making the Award in relation to Dearness Allowance without examining the capacity to pay the additional amount and that the High Court should have remanded the matter to the Tribunal for considering this issue in the light of the documents which were submitted by the appellant before the High Court.
Dismissing appeal, this Court, HELD: 1.
The activity carried on by the appellant compa ny falls within the ambit of the expression "industry" defined in Section 2(j) of the .
The Award of the Industrial Tribunal cannot, there fore, be assailed on the basis that the appellant is 935 not carrying on an 'industry ' under the Act.
[943E] Bangalore Water Supply & Swerage Board v .R. Rajappa and Ors., ; , applied.
Management of Safdar jung Hospital vs Kuldip Singh Sethi, ; ; State of Bombay vs Hospital Mazdoor Sabha, ; ; D.N. Banerjee vs P.R. Mukherjee, ; and Corporation of the City of Nagpur vs Its employees; , , referred to. 2.
It is not the requirement of Section 19(2) of the that there should be a formal notice terminating a settlement, and notice can be inferred from the correspondence between the parties.
[944B] Indian Link Chain Manufacturers Ltd. vs Their Workmen, [1972] I SCR 790, applied.
2.1 In view of the finding of the Division bench that the letter of employees Union dated November 24, 1966 was a notice under section 19(6) as well as section 19(2) of the and that the said letter contained a clear intimation of the intention of the employ ees to terminate the Award, the High Court was justified in holding that the earlier award had been validly terminated before the passing of the order of reference.
[943H; 944A B ] 3.
The High Court was right in taking the view that while exercising its jurisdiction under Article 226 of the Constitution the High Court should generally consider the materials which were made available to the Tribunal and fresh or further materials which were not before the Tribu nal should not normally be allowed to be placed before the Court.
[944F G] 3.1 In the instant case the appellant has not been able to show why the documents relied on by it were not produced before the Tribunal.
Therefore there is no justification for accepting the plea of the appellant for reconsideration of the Award of the Tribunal in the light of the documents submitted by the appellant during the pendency of the appeal before High Court.
[944G H] 4.
A question raised for the first time in the Supreme Court involving an inquiry into questions of fact cannot be allowed to be agitated.
[944E] 936
</s>
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<s>[INST] Summarize the judgementAppeals Nos. 351 356 and 358 369 of 1960.
Appeals by special leave from the Award Part 1 of the Industrial Court, Bombay, in References IC Nos. 261, 297, 238, 241, 248, 263, 266, 271, 301, 302, 257, 237 296: 299, 300, 283 and 284 of 1959.
3 N. A. Palkhivala, I. M. Nanavati, section N. Andley J. B. Dadachanji, Rameshwar Nath and P. L. Vohra, for the appellants in C. A. No. 351 of 1960.
N. A. Palkhivala, J. B. Mehta, section N. Andley, J. B. Dadachanji, Rameshwar Nath and P. L. Vohra, for the appellant; in C.As.
Nos. 352 and 358 of 1960.
R. J. Kolah, J. B. Mehta, section N. Andley, J. B. Dadachanji, Rameshwar Nath and P. L. Vohra, for the appellants in C.As.
Nos. 353 and 362 of 1960.
I. M. Nanavati, section N. Andley, J. B. Dadachanji, Rameshwar Nath and P. L. Vohra, for the appellants in C. As.
Nos. 354, 356, 363 365, 367 and 369 of 1960.
J. B. Mehta, section N. Andley, J. B. Dadachanji, Rameshwar Nath and P. L. Vohra, for the appellants in C. As.
Nos. 355, 359 361, 366 and 368 of 1960.
section R. Vasavada, for the respondent in C. As.
Nos. 351, 352, 355, 358, 360 364, and 368 of 1960.
N. H. Shaikh, for the respondent in C. As.
Nos. 353 and 365 of 1960.
N. M. Barot, for the respondent in C. As.
Nos. 354, 359 and 367 of 1960.
K. L. Hathi, for the respondent in C. As.
Nos. 366 and 369 of 1960.
December 7.
The Judgment of Gajendragadkar, Sarkar, Wanchoo and Mudholkar, JJ. was delivered by Wanchoo, J. Subba Rao, J. delivered a separate Judgment.
WANCHOO, J.
These eighteen appeals by ' special leave raise a common question and will be dealt with by this judgment.
The appellants are certain cotton textile mills in Ahmedabad while the respondent in each appeal is the Textile Labour Association, Ahmedabad, which is a representative union of the cotton textile workers in Ahmedabad.
The total number of cotton textile mills in Ahmedabad is 66; therefore, 66 references under section 73 A of the Bombay Industrial Relations Act, No. XI of 1947 (hereinafter called the Act), were made to the industrial court for arbitration of disputes arising out of notices of change 4 given by the respondent making a demand for bonus for employees of textile mills in Ahmedabad.
It appears that there was an agreement between the Textile Labour Association and the Ahmedabad Mill owners ' Association representing the member mills on June 27, 1955 (hereinafter referred to as the Agreement), with respect to payment of bonus by the mills to their employees.
The Agreement was to remain in force for a period of five years, beginning with January 1, 1953, and ending with December 31, 1957, and related to bonus for the five calendar years from 1953 to 1957 (both inclusive).
When the Agreement came to an end disputes arose about bonus for the year 1958.
The Agreement was not extended and a notice of change under section 42 of the Act was given by the Textile Labour Association to the Ahmedabad Mill owners ' Association on July 21, 1959, claiming that all the employees employed during the year 1958 in the member mills be paid an adequate amount of bonus having regard to the volume of profits, if any, or some bonus irrespective of profits to fill the gap between the existing wage and the living wage so as to avoid unrest among the employees.
It further appears that notice in the same terms was given to individual mills about the same time.
As no agreement was arrived at between the parties, 66 references with respect to the sixty six mills were made to the industrial court as already mentioned above.
The industrial court considered all the sixty six references together and came to the conclusion that the Agreement of 1955 had worked fairly to both sides and was substantially in accord with the long standing practice in the industry in Ahmedabad even before the Agreement and that its extension for one year was essential for keeping industrial peace.
It therefore ordered the extension of the Agreement for the year 1958 and directed the parties to file within six weeks from the date of the award calculations of bonus payable for the year 1958 in the light of the decision and thereafter the court would proceed to award appropriate bonus in the case of each individual mill.
Thereupon there were fifty two applications for special leave to 5 appeal to this Court in which special leave was granted.
Thirty four of the appeals arising out of the special leave petitions have been withdrawn and only eighteen now remain for decision.
It appears that the remaining fourteen mills accepted the decision of the industrial court, so that now forty eight mills are out of the picture and only eighteen are before the Court.
The main contention of the appellants before the industrial court was that in view of the law laid down as to bonus by this Court in the Associated Cement Companies Ltd. vs The Workmen (1), it was not open to it to extend the Agreement for the year 1958 as that would be against the concept of bonus as understood in industrial law.
The same point is being urged before us and the question that falls for decision is whether the industrial court was right in law in extending the Agreement for another year.
In order to appreciate the dispute between the parties with respect to the extension of the Agreement we may refer to the salient terms of the Agreement.
Before we do so, we may mention that the Agreement was "without renouncing the general principles enunciated in decisions and awards of the arbitration boards, the industrial court, the Labour Appellate Tribunal and the Supreme Court in respect of bonus or the rights and privileges created thereunder".
It was entered into only with a view to creating goodwill among workers and for the purpose of maintaining peace in the industry and without creating a precedent for the future.
The Agreement in the first place provided that the claim of the employees for bonus would only arise if there is an available surplus of profit after making provision for all the prior charges.
These prior charges were: (i) statutory depreciation and the development rebate; (ii) taxes; (iii) reserve for rehabilitation, replacement and modernisation of block as calculated by the industrial court (basic year 1947); (iv) six per centum return on paid up capital including bonus shares; and (v) two per cent.
return on reserves employed as working capital.
After the available surplus was determined thus, a mill (1) 6 having an available surplus of profit had to pay to its employees bonus which would in no case be less than an amount equivalent to 4.8% of basic wages earned during the year; nor was it to exceed an amount equivalent to 25% of the basic wages earned during the year.
It was also provided that in case the available surplus was more than sufficient for granting bonus at a higher figure than the ceiling of twenty five per centum of basic wages earned during the year and the maximum bonus of 25 per centum was paid, such a mill would be deemed to have set aside a part of the residue of available surplus after grant of maximum bonus not exceeding 25 per cent.
of the basic wages earned during the year as a reserve for bonus for purposes of "set on" (adjustment) in subsequent years.
Secondly it was provided that where in the case of a mill, the available surplus was not more than the ceiling of 25 per cent.
of basic wages fixed for bonus, the bonus would be fixed after deducting at least Rs. 10,000 from the available surplus.
Further it was provided that if a mill had an available surplus of profits which would suffice to pay bonus at a rate lower than the minimum of 4.8 per cent.
it would pay the minimum and would be entitled to set off the excess amount thus paid against the available surplus in a subsequent year or years and there were provisions how this set off would be worked out.
Lastly it was provided that if the profits of a mill were not sufficient to provide for all prior charges as mentioned above, though it had made profits, or where the mill had actually suffered a loss, such a mill would a& a special case for creating goodwill among its workers and for continuing peace in the industry but without creating a precedent pay to its employees the minimum bonus equivalent to 4.8 per cent.
of the basic wages but would be entitled to set off this amount towards any available surplus in any subsequent years, subject, however, always to a payment of a minimum bonus at the rate of 4.8 per cent.
of basic wages earned during the year.
It has been contended on behalf of the appellants that the formula under the Agreement departs in 7 some vital aspects from what is known as the Full Bench formula evolved by the Labour Appellate Tribunal in The Mill owners ' Association, Bombay vs The Bashtriya Mill Mazdoor Sangh (1), which has been approved by this Court in the Associated Cement Companies ' case (2) and is thus the law of the land so far as bonus is concerned.
It is urged therefore that inasmuch as the formula under the Agreement departs from the Full Bench formula which is now the law of the land, it was not open to the industrial court to extend the Agreement in the face of the decision of this Court in Associated Cement Companies ' case(1) and in so far as the industrial court has done so it has gone against the law relating to bonus and therefore the award should be set aside.
Two questions immediately arise in this connection: the first relates to the jurisdiction of the industrial court to impose new obligations upon the parties and the second is whether if the industrial court has jurisdiction to impose new obligations it could do so in a matter of this kind considering the concept of bonus as laid down by the decisions of this Court.
So far as the first question is concerned (namely, the general power of an industrial court to impose new obligations upon the parties), the matter is now well settled by the decisions of the Federal Court and also of this Court.
It was held by the Federal Court in Western India Automobile Association vs Industrial Tribunal, Bombay and Others (3) that " adjudication does not in our opinion mean adjudication according to the strict law of master and servant.
The award of the tribunal may contain provisions for settlement of a dispute which no court could order if it was bound by ordinary law, but the tribunal is not fettered in any way by these limitations.
" The Federal Court also approved the view of Ludwig Teller that "industrial arbitration may involve the extension of an agreement or the making of a new one, or in (1) (2) (3) 8 general the creation of new obligations or modification of old ones while commercial arbitration generally concerns itself with interpretation of existing obligations and disputes relating to existing agreements (see p. 345)." This Court also in Rohtas Industries Ltd. vs Brijnandan Pandey (1) held that " a court of law proceeds on the footing that no power exists in the courts to make contracts for the people; and the parties must make their own contracts.
The Courts reach their limit of power when they enforce contracts which the parties have made.
An industrial tribunal is not so fettered and may create new obligations or modify contracts in the interests of industrial peace, to protect legitimate trade union activities and to prevent unfair practice and/or victimisation (see p. 810).
" In Patna Electric Supply Co. vs Patna Electric Supply Workers ' Union (2), this Court held that "there is no doubt that in appropriate cases industrial adjudication may impose new obligations on the employer in the interest of social justice and with the object of securing peace and harmony between the employer and his workmen and full cooperation between them (see p. 1038)." and approved of the decision of the Federal Court in Western India Automobile Association 's case (3).
There is no doubt therefore that it is open to an industrial court in an appropriate case to impose new obligations on the parties before it or modify contracts in the interest of industrial peace or give awards which may have the effect of extending existing agreement or making a new one.
This, however, does not mean than an industrial court can do anything and every thing when dealing with an industrial dispute.
This power is conditioned by the subject matter with which it is dealing and also by the existing industrial law and it would not be open to it while dealing with a particular matter before it to overlook the industrial (1) ; (2) [1959] SUPP.
2 S.C.R. 761.
(3) 9 law relating to that matter as laid down by the legislature or by this Court.
This brings us to the second question, which is the real question in dispute in this case, namely, when dealing with a bonus case, like the present, was it open to the industrial court to overlook the law laid 7 down by this Court in Associated Cement Companies ' case (1) and make an award extending the Agreement for a further period of one year? In order to determine this question, we have to look at the concept of bonus as evolved in the industrial law of this country by industrial tribunals and now by the decision of this Court.
So far as we can see, there are four types of bonus which have been evolved under the industrial law as laid down by this Court.
Firstly, there is what is called a production bonus or incentive wage (see Titaghur Paper Mills V. Its Workmen (2) ); the second is bonus as an implied term of contract between the parties (see Messrs. Ispahani Ltd. vs Ispahani Employees ' Union (3)); the third is customary bonus in connection with some festival (see The Graham Trading Co. vs Its Workmen (4)) and the fourth is profit bonus which was evolved by the Labour Appellate Tribunal in The Mill owners ' Association Bombay vs The Rashtriya Mill Mazdoor Sangh, Bombay (5), and which has been considered by this Court fully in two cases.
We are in the present case dealing with bonus of the fourth kind, namely, profit bonus and what we say subsequently refers only to this kind of bonus.
What is the concept of profit bonus with which we are concerned in this case, for it is this concept which will determine whether it was open to the industrial court in this case to extend the Agreement for 1958? In Muir Mills Co. Ltd. vs Suti Mills Mazdoor Union (6), this Court pointed out that "There are two conditions, which have to be satisfied before a demand for bonus can be justified and (1) [1959] SUPP.
2 S.C.R. 1012.
(3) [1960] 1 S.C.R. 24.(4) [1960] 1 S.C.R. 107.
(5) [1955] 1 S.C.R. 991.
2 10 they are: (1) when wages fall short of the living standard, and (2) industry makes huge profits part of which are due to the contribution which the workmen make in increasing production.
The demand for bonus becomes an industrial claim. .
The basis for the claim is that labour and capital both contribute to the earning of the industrial concern and it is fair that labour should ' derive some benefit, if there is a surplus after meeting prior or necessary charges. . .
The surplus that remained after meeting the aforesaid prior charges would be available for distribution as bonus.
" The matter was again considered by this Court in the Associated Cement Companies ' case (1) where the Full Bench formula evolved by the Labour Appellate Tribunal was gone into at length.
The workmen contended in that case that the formula required revision as the employers were becoming increasingly more rehabilitation conscious and their appetite for the provision for rehabilitation was fast growing with the result that in most cases, after allowing for rehabilitation, there was no surplus left for the purpose of bonus and the main object of the formula was thus frustrated.
It was further contended for the workmen that the whole of rehabilitation expenses should not be provided for out of trading profits and that the claim for rehabilitation should be fixed at a reasonable amount and the industry should be required to find the balance from other sources.
It was there held that"though there may be some force in the plea made for the revision of the Full Bench formula, the problem raised by the said plea is of such a character that it can appropriately be considered only by a high powered commission and not by this Court, while hearing the present group of appeals.
"This Court also held that "the Full Bench formula had on the whole work ed fairly satisfactorily in a large number of industries all over the country, and the claim for bonus should be decided by the Tribunals on the basis of this formula without attempting to revise it.
The (1) 11 formula was elastic enough to meet reasonably the claims of the industry and labour for fair play and justice. .
It was based on two considerations: first, that labour was entitled to claim a share in the trading profits of the industry, because it had parti ally contributed to the same; and second, that labour was entitled to claim that the gap between its actual wage and the living wage should within reasonable limits be filled up.
" The Full Bench formula provided for arriving at the available surplus after meeting prior charges, namely, (i) depreciation, (ii) taxes, (iii) return on paid up capital, (iv) return on working capital and (v) rehabilitation.
The formula further dealt with the claim for bonus on the basis that the relevant year is a selfsufficient unit and appropriate accounts have to be made in respect of the said year.
Finally, it was pointed out that it was only after all the prior charges had thus been determined and deducted from the gross profits that the available surplus could be ascertained for payment of bonus, and that when the available surplus had been ascertained, there were three parties entitled to claim shares therein, namely, (i) labour 's claim for bonus, (ii) industry 's claim for the purpose of expansion and other needs, and (iii) the shareholders ' claim for additional return on the capital invested by them; the ratio of distribution would neces sarily depend on several factors.
It would thus be clear that the essential concept of profit bonus is that there should be an available surplus determined according to the principles laid down in the cases mentioned above for distribution.
If there is no such available surplus for distribution, there can be no case for payment of profit bonus.
This is the industrial law as laid down by this Court with respect to this kind of bonus in Associated Cement Companies ' case (1).
It would in our opinion be not open to an industrial court or tribunal to ignore this law as to bonus and to extend an agreement for payment of bonus, which is against the basic concept of bonus as laid down by the decisions of this Court on the ground that an (1) 12 industrial court has power generally to extend agreements or to create new obligations.
As already pointed out, that power has to be exercised keeping in view the subject matter before the tribunal and the law laid down by the legislature or by the decisions of this Court, with respect to that subject matter.
The industrial court in this case was not unaware of this position, viz., that it *as departing from the law laid down in the Associated Cement Companies ' case (1) and other bonus cases; but it held that this Court was dealing in those cases with individual units, and not with a case where there were numerous concerns in an industry at one centre, with its particular historical back ground, where previous awards had been on an industry wise basis.
It therefore held that the decisions of this Court could not apply in their entirety to the dispute before it and that this Court could not have intended that in a case where there was the additional circumstance that the parties had themselves voluntarily modified the bonus formula in some respects by a long term agreement, that could not be extended by an industrial court.
It is the correctness of this view which has been strongly disputed before us by the appellants.
Before deal with this matter, we should like to point out that the fact that there are numerous concerns in a particular place can have no relevance in considering the question whether the Full Bench formula can apply to cases like the present.
Even though this Court was dealing with the case of one concern, namely, the Associated Cement Companies, it pointed out that the Full Bench formula had worked fairly satisfactorily all over the country and should continue to be applied without revision till such time as a high powered commission went into the question.
There is in our opinion no question of industry cum region approach in the matter of a bonus dispute of this kind.
There is no doubt that in many matters, like wages, conditions of service, over time allowance, dearness allowance, gratuity, and so on, industry cum region approach has been made by industrial courts (1) 13 in this country and, rightly so.
But there is, in our opinion, no scope for an approach of this kind in the case of bonus, the basic concept of which is that payment depends on surplus of profits available according to some formula in the case of each industrial concern.
Nor can it be said that the Agreement in this case is dealing with bonus in what is known as industry cumregion basis.
Its salient terms as set out above will show that it deals with bonus according to available surplus of each mill, so that bonus paid by each mill depends on its own available surplus and the sixty six mills situate in Ahmedabad may pay different amounts of bonus varying from a minimum of 4 8 per cent.
of the basic wages to 25 per cent.
of the basic wages.
Similar differences will arise if the Full Bench formula is applied to the sixty six mills in Ahmedabad.
Thus the Agreement which has been extended, is not based on industry cum region approach, as it is understood.
That approach, say, with respect to wages means that wages of all concerns situate in a particular area engaged in a particular industry should be the same.
On that approach the bonus of all these sixty six mills should also be the same percentage for each mill in that area; but that is not the basis on which the Agreement was arrived at.
The basis of the Agreement is that each individual mill is treated as a separate unit and its available surplus worked out according to the formula in the Agreement itself.
This is also the basis of the Full Bench formula and the available surplus of each unit is worked out according to that formula, though the result of the application of the two formulae in each case may not be the same.
There is in our opinion therefore no justification for the view that the Full Bench formula approved by this Court in the Associated Cement Companies ' case (1) can have no application where there are numerous concerns of one nature at one centre.
Some bonus awards were brought to our notice to show that they were on industry cum region basis, namely, The Sugar Mills of Bihar vs Their Workmen (2) and The Sugar Mills, Uttar Pradesh vs (1) (2) [1951] I. L. L. J. 469.
14 Their Workmen(1).
These awards related to sugar industry in Uttar Pradesh and in Bihar.
As we read these decisions, we do not find real industry cumregion approach which would result in uniform bonus for all the mills dealt with by these two awards.
What we find is that a different formula was worked out for awarding profit bonus linked with production on the basis that there were profits; but when the formula is worked for each mill the bonus would differ from mill to mill according to its production.
Further, we find that in the Uttar Pradesh case there were certain exemptions granted to certain factories, presumably on the ground that they were not in a position to pay bonus for want of sufficient profits.
It is true that in the Bihar case it was said that the question of bonus could be considered on industry wise and not on unit wise basis, but that only meant that one formula was evolved for the whole of Bihar and applied to every mill in that area.
That is what exactly the Full Bench formula also has done, for it is the same formula which applies to all industrial concerns all over the country now after the decision of this Court.
In the Bihar case, an argument was addressed to apply the Full Bench formula, but that was not accepted on the ground that balance sheets and profit and loss accounts were not reliable and therefore bonus was linked with production.
In the Bihar case also some factories were exempted from paying bonus presumably on the ground that they were unable to do so not having made profits.
These cases therefore are not instances of real industry cum region approach.
Reference was also made to The, Textile Mills in Coimbatore District vs Their Workmen (2) relating to Coimbatore textile mills.
In that case the industrial court considered whether bonus at a flat rate for all the mills should be awarded or whether a distinction should be made between mills and mills.
It held that the mills themselves when they paid bonus observed or maintained no distinction; therefore in the peculiar circumstances of that case a uniform rate of 33 1/3 per cent. was awarded for all the mills as specially all the mills had (1) (2) 15 without exception 'made unique profits.
As we have said already the basic concept of profit bonus, as it appears from the judgments of this Court, is that there should be an available surplus of profits in a particular concern in a particular year, to which the bonus relates and on this basic concept there is no scope for an approach on the basis of industry cum region in the matter of bonus in the sense that every mill in a region should pay the same bonus.
There is therefore no question of industry cum region approach in the present case, and even the formula in the Agreement is not on a real industry cum region approach and has to be worked out from mill to mill, which is like the Full Bench formula.
The reasons therefore which led the industrial court in this case to distinguish and depart from the decision of this Court in The Associated Cement Companies ' case (1) do not appear to us to be substantial and there was therefore no ground for departing from that decision for those reasons.
This brings us to a consideration of the formula as provided in the Agreement and the Full Bench formula as approved by this Court.
It was urged on behalf of the respondent that the two formulae were basically the same; both provided for prior charges and in both bonus was to be paid on the availability of surplus profits, though it was admitted that in certain respects there were differences.
Now if these differences were merely of detail and did not affect some of the vital aspects of the Full Bench formula it might be said that there was no ignoring of the law as laid down by this Court and therefore the tribunal was not unjustified in extending the Agreement for a year.
But a comparison of the formula in the Agreement with the Full Bench formula shows differences in three vital aspects.
In the first place, rehabilitation provided in the Agreement differs vitally from rehabilitation as explained in The Associated Cement Companies case (1).
In the second place, the formula in the Agreement provides for payment of a minimum bonus even though there may be no available surplus and even though the particular mill might have made actual (1) 16 loss.
Thirdly, while the Full Bench formula as approved by this Court treats a particular year as a selfsufficient unit, there is provision for set off and set on in the formula in the Agreement.
Can it therefore be said that the formula in the Agreement which departs in these vital particulars from the Full Bench formula in the matter of bonus could be extended for another year by the industrial court in the face of the decisions of this Court laying down the law as to what profit bonus is and how it should be worked out? The tribunal therefore when it extended the formula in the Agreement which departed from the Full Bench formula in certain vital aspects was undoubtedly ignoring the industrial law as laid down by this Court and going against it.
It was its duty when dealing with the question of profit bonus to apply the Full Bench formula, as approved by this Court and then arrive at the quantum of bonus to be awarded in the case of each mill.
In particular by extending the Agreement the tribunal made it possible for payment of a minimum bonus even when there was either insufficient available surplus to pay bonus or no available surplus at all or even actual loss; the tribunal was thus definitely going against the industrial law relating to bonus as laid down by this Court.
It had in our opinion no power to do so and the reasons which it gave for departing from the law laid down by this Court are unsubstantial and do not commend themselves to us.
In these circumstances the order of the tribunal extending the Agreement for a year cannot be upheld.
Further it was urged that in any case the Agreement contemplates payment of bonus out of profits of the industry at Ahmedabad as a whole and that is why it has provided for set off and set on.
Whatever may be said about this provision on a long term basis, the tribunal 's jurisdiction was limited by its terms of reference.
There was not one reference before the tribunal on industry cum region basis but sixty six separate references, one relating to each mill.
It was required to consider the question of bonus for each mill for the year 1958 only and thus had nothing to 17 do with set off and set on or the profits of the industry as a whole at Ahmedabad.
The tribunal was only concerned with 1958 and no consideration as to what happened before that year or what may happen after 1958 could enter into its decision of the question of bonus for the year 1958.
The principle of set off and set on therefore to be found in the Agreement could not convert payment of bonus for 1958, say, by a loss making mill into profit bonus as laid down by the decisions of this Court.
The tribunal 's award in this case therefore would clearly be against the law as to bonus laid down by this Court, for its jurisdiction was confined only to the year 1958 and no more.
It was however urged on behalf of the respondent that there is a fifth kind of bonus, namely, goodwill bonus and that the Agreement when it provides for a minimum bonus irrespective of availability of profits provides for such bonus in the interest of industrial peace.
It is enough to say that so far as what is called goodwill bonus is concerned it pre supposes that it is given by the employer out of his own free will without any compulsion by an industrial court.
As its very name implies it is a bonus which is given by the employer out of his free consent in order that there may be goodwill between him and his workmen; but there can be no question of imposing a goodwill bonus by industrial courts, as imposition of such a bonus is a contradiction of its very concept.
We have already referred to four kinds of bonus which prevail in the industrial law in India and which can in certain circumstances be imposed by industrial tribunals; but there can be no question of the imposition of the so called goodwill bonus, for that bonus depends upon the goodwill of the parties and on their free consent.
In the absence of such free consent, there can be no question of any goodwill bonus.
Before we part with these appeals, however, we must briefly advert to the general considerations which have been pressed before us very strongly by Mr. Vasavada for the respondents and Mr. Ambekar for the intervening parties.
It has been urged before us 18 that we should be reluctant to interfere with the agreement because it has worked satisfactorily in Ahmedabad, and the reversal of the award under appeal may lead to discontent in a very important centre of.textile industry in this country.
It has also been strenuously argued that the Agreement offers a very reasonable solution to the vexed problem of bonus and the pattern set by it has been copied in Bombay, Madhya Pradesh and Coimbatore.
If the pattern thus set for determining the textile employees ' claim for bonus has been adopted by a substantial part of the textile industry in this country, the Court should desist from disturbing the smooth working of the said pattern unless it is com pelled to do so.
It may be conceded that some features of the Agreement are undoubtedly very reasonable and in the interest of the industry as a whole.
The agreement has put a ceiling on bonus and that is a term very much in favour of the employer, because in some cases where the available surplus is very large, then under the working of the Full Bench formula the employees are tempted to claim, and industrial tribunals are justified in awarding, a pro portionately substantial amount as bonus reaching or even exceeding in some cases the level of basic wages of even 8 or 9 months.
This trend has been controlled by the Agreement.
It is true that the Agreement requires the payment of the minimum bonus but this provision is intended to work as a part of the larger agreement spreading over some years and the employer has agreed to pay the minimum bonus even though in a particular year he may have no available surplus, because he and his employees expect or anticipate that the employer may have available surplus in the succeeding year.
The working of the Agreement is really intended to spread over a number of years and the account between the employers and the employees in that behalf is conceived as a continuing and running account.
These features of the Agreement may be regarded as commendable.
The problem of rehabilitation which has assumed a complex form has also been attempted to be solved by the Agreement in a practical way.
The solution 19 adopted by the Agreement in that behalf, it is claimed, is based on the historical and factual genesis of the original formula evolved by the Full Bench of the Labour Appellate Tribunal when it dealt with the problem of the textile industry in Bombay.
The argument is that until 1962, the Agreement should be allowed to work when the position may be reviewed at length.
Since this Court delivered its judgment in the case of The Associated Cement Companies (1) it has come to our notice that in cases where the employer claims an exaggerated amount for rehabilitation, or where a reasonable claim made by the employer in that behalf is unreasonably challenged by the employees, the dispute is protracted.
The trial of the issue tends to become complicated, and that leads to bitterness between the parties.
It has been urged before us that time has now come when the industrial courts will have to face the problem of radically changing the formula.
It is argued that modern economic thought does not encourage the theory that the whole of the rehabilitation amount must come from the current profits of the industry, and it was stated before us that Government may have gradually to step in to assist the industry by advancing sufficient loans on reasonable terms to enable the industry to meet the demand of its rehabilitation.
However, as we pointed out in our decision in the case of The Associated Cement Companies (1) these matters can be properly and effectively decided by an industrial court if the major representative industries in the country and their employees are brought before it with a proper reference, or it can be tackled more appropriately by a high power commission appointed in that behalf.
We were told that the Government of India has taken a decision to appoint such a commission, and that it would soon resolve this problem on a more rational and scientific basis.
During the course of the hearing of these appeals we suggested to the parties that in view of the pending appointment of the commission, parties may settle the present dispute amicably and that the appellant mills may fall in line with the rest (1) 20 of the mills in Ahmedabad, but despite their best efforts the parties could not settle the dispute and wanted a decision from this Court on the points of law raised in the present appeals; that is why we have had to decide the points of law, and in doing so inevitably general considerations to which we have just adverted cannot play a material part.
In the course of the argument reference was made by Mr. Ambekar to the concept of goodwill bonus; that again is a matter which may be evolved by agreement between the parties or decided by a highpower commission.
If the matter has to be decided according to law as has been laid down by this Court then the conclusion would be inevitable that on essential points the Agreement departs from the Full Bench formula, and however commendable it may be on the whole it can continue only by agreement and cannot be enforced by industrial adjudication against the will of any of the parties; that is why we have come to the conclusion, though not without regret, that the appeals must be allowed and the matter must be sent back to the tribunal for disposing of the issue before it in accordance with law.
We direct that the tribunal should proceed to try the question whether any bonus should be awarded to the employees of the eighteen mills before us on the basis of the Full Bench formula as interpreted by this Court in the case of The Associated Cement Companies (1).
In the circumstances there will be no order as to costs.
SUBBA RAO, J.
I have had the advantage of perusing the judgment prepared by my learned brother, Wanchoo, J.
I regret my inability to agree.
As mine is a solitary dissent, it may not serve any useful purpose to elaborate on the question raised at great length.
I would, therefore, briefly refer to the relevant facts which have already been fully stated by my learned brother and express my views concisely on the question.
presented before us.
These appeals raise a dispute between the Textile Labour Association,, Ahmedabad, the representative (1) 21 union of the textile industry in Ahmedabad, and the various textile mills in that area in respect of the bonus payable for the year 1958.
The said Labour Union entered into a five year pact with the Ahmedabad Mill Owners ' Association, representing the member mills, in regard to payment of bonus for the years 1953 to 1957.
The Labour Union demanded bonus for the year 1958 on the basis of the said pact.
The mill owners claimed that the said pact was contrary to the law laid down by the decision of this Court in the case of The Associated Cement Companies Ltd., Dwarka Cement Works, Dwarka vs Its Workmen (1) and that, if the rehabilitation cost was calculated on the basis of the principles laid down therein, there would not be any "available surplus" to sustain the claim for bonus.
The Industrial Court to which the dispute was referred elaborately.
considered the arguments advanced and came to the conclusion that the five year pact which originated in Ahmedabad was not only fair in itself but also an important contribution to industrial peace, and that it did not in any way run counter to the law laid down by the Supreme Court.
On that finding it extended the operation of the pact for one more year and directed the parties to file within six weeks from the date of the award calculations in respect of the bonus payable for the year 1958, in the light of its decision and on the footing that the five year pact was for six years.
The main question in the appeals is whether the said pact violates the law laid down by this Court.
Before considering this contention it would be convenient to notice the terms of the said pact.
The said pact is a lengthy document, though precisely drawn, and to read it in full is to unnecessarily burden the judgment.
I shall, therefore, briefly summarize its terms.
The contracting parties were the Textile Labour Association of Ahmedabad, a representative union for the local area of Ahmedabad on the one part, and the Ahmedabad Mill Owners ' Association, Ahmedabad, representing its local member mills, on the other part.
(1) 22 It was executed on June 27, 1955, to cover a period of five years from 1953 to 1957, inclusive of both years, for grant of bonus to the employees of the Cotton Textile Mills of Ahmedabad.
The object of the agreement was to create good will among the workers and for the purpose of maintaining peace in the industry.
The basis of the agreement was that it applied for the entire Ahmedabad Textile Industry and for a period of five years.
The "available surplus" of each mill was ascertained in accordance with the Full Bench Formula laid down by the Labour Appellate Tribunal in Mill Owners ' Association, Bombay vs The Rashtriya Mill Mazdoor Sangh, Bombay (1).
The maximum bonus payable by every mill of the said area was fixed at 25 per cent.
of the total basic wages earned during the year, and the minimum was fixed at 4.8 per cent.
of the said basic wages.
If in a particular year a mill had an "available surplus" adequate for granting bonus at a higher quantum than the ceiling of 25 per cent.
of the basic wages.
it would nationally set aside the part of the residue of the "available surplus" after the grant of the maximum bonus not exceeding an amount equivalent to 25 per cent.
of the basic wages earned during that year as a reserve for bonus for the purpose of "set on" (adjustment) in subsequent years.
If the "available surplus" was adequate only to grant bonus at a rate lower than the ceiling, the quantum of bonus would be fixed in such a manner that there would remain with the mill at least a minimum of Rs. 10,000.
If in respect of any year a mill had an "available surplus" adequate to pay bonus at a rate lower than the minimum rate, it would be entitled to "set off" the excess amount of bonus that would be payable in a subsequent year or years.
In setting off the said amount of bonus that, would be payable against subsequent year or years, if the surplus was adequate only to grant bonus at a rate lower than the maximum rate, the mill would first set aside out of the "available surplus" an amount of Rs. 10,000 and, then out of the balance, it would further take out the excess amount paid by it as bonus in the previous (1) 23 year, and then it would distribute the remainder as bonus.
Even if a mill had made a loss in a particular year, it had to pay the minimum bonus, but it would be entitled to "set off" the amount thus paid against the amount of bonus that would be payable in the subsequent year or years, in the same manner as in the case of a surplus adequate to grant bonus only at a rate lower than 25 per cent.
of the basic wages.
In short, when the surplus was adequate to pay bonus at 25 per cent.
of the basic wages earned during the year, a mill had to pay the maximum of 25 per cent.
of the basic wages.
When it was adequate only to grant bonus of less than 25 per cent.
of the basic wages, it would pay the said bonus after reserving a sum of Rs. 10,000 for itself.
If there was loss, it would pay the minimum bonus.
Whatever amounts were paid were adjusted on the principle of "set on" and "set off" in the subsequent years.
There was also a provision that after the prescribed period all the outstanding liabilities under the formula of "set on" and "set off" would come to an end.
Three principles clearly underlie the entire scheme, namely, (i) that though for the purpose of ascertaining the surplus, the profits of a particular mill were taken as the criterion, the position of the entire Ahmedabad Textile Industry was taken into consideration; (ii) that the beneficent features of the scheme could be gathered only by its long term operation; and (iii) that though in a particular year in the case of a particular mill there might not be "available surplus", the principles of "set on" and "set off" indicate that the bonus was linked with profits.
As reasonable men trying to settle their disputes, both the parties, representing their respective associations, adopted an optimistic attitude and proceeded on the basis that the entire industry would make a profit and that every mill could be expected to make reasonable profits in at least some of the five years, though it might incur loss in other years.
The validity of the agreement should be judged on the basis adopted.
In the Ahmedabad Textile Industry, it is in evidence, the average monthly wage for workers in 1957 24 was Rs. 54.
Fifteen days ' basic wages, i.e., the minimum bonus prescribed under the pact, would come to an average total wages for 5 days; and 3 months ' basic wages would come to 19 days ' total wages on the average.
Prima facie the bonus fixed is very reasonable and cannot be said to be oppressive to the mill owners.
The said bonus agreement, by its reasonableness and beneficent effects on the industry, attracted the attention of other mills throughout India.
Exhibit U 2 shows the particulars of other mills which have adopted the agreement.
The Bombay Textile Industry, The Madhya Bharat Mill owners ' Association, The Modi Spinning & Weaving Mills, Modinagar, and the cotton mills at Surendranagar (Saurashtra) ' Sidhpur, Viramgam Nadiad and Petlad, Cambay Baroda, Surat adopted the said scheme with suitable modifications.
The silk industry in Bombay and the plantation industry in Madras also accepted the principles underlying the said agreement.
We are told that even the Coimbatore area has recently adopted a similar agreement.
The fact that the said five year pact was followed by so many other mills is a fair indication that it was basically sound and capable of yielding good results.
Experienced members of the Industrial Courts spoke highly of the pact.
Late Shri section H. Naik, a Member of the Industrial Court, adopted the pact in a dispute between the Bombay Mill Owners ' Association and the Rashtriya Mill Mazdoor Sangh, and in making an award in terms of a similar pact, made the following observations: "This award, based upon an agreement arrived at as a result of persistent and continued efforts on the part of both the parties, keeping in view the prosperity of the employers as well as the well being of the employees, will go down in history as a significant landmark in collective bargaining.
It augurs well for the future of the industry, as well as those employed therein, particularly in view of the ambitious Second Five Year Plan on which the country will shortly launch.
It also avoids, for 25 some time, and let us hope for all time to come, the bonus dispute which cropped up every year since 1947.
I congratulate both the parties and compliment them on the successful termination of their efforts to bring peace to the industry and set an example to the employers and employees in the country.
" The said weighty observations apply mutatis mutandis to the agreement in question.
Shri H. V. Divatia, another experienced Member of the Industrial Court, in his award on the bonus dispute of the Ahmedabad Textile Mills for 1952 observed: "Ever since the former practice of taking all the textile mills in one centre as one unit for the purpose of determining the bonus was given up, there has been dissatisfaction on both sides on the bonus question every year and in my view this change as well as the formula set up by the Labour Appellate Tribunal have made the bonus issue a very complicated one resulting in bitterness on both the sides instead of promoting peace and harmony between the employers and workers.
I hope the whole matter is reconsidered at the highest level.
If bonus is to be given, it must be awarded in such a way that it does not defeat its purpose.
" The agreement did nothing more than reverting to the former practice of taking all the textile mills in one centre as one unit for the purpose of determining.
the bonus, though for ascertaining the quantum of bonus payable the balance sheets of individual units were taken into consideration.
In making the present award the Industrial Court on a consideration of the entire material placed before it came to a definite finding that on the.
whole the five year pact had worked fairly for both the parties and that the extension of the said agreement for one more year would help in promoting peace in that industry in Ahmedabad and that owing to the goodwill created by the five year bonus pact, the industry also benefited by schemes of rationalization.
It was also brought to our notice that in the textile industry 4 26 in Ahmedabad area there were never any strike and the disputes in the recent years were settled amicably across the table.
In such a situation this Court was asked under article 136 of the Constitution to set aside the award and to bring about chaos where peace existed and to introduce unrest and disharmony where stability and harmony prevailed.
It was said that this Court had no option but to do so as the agreement was contrary to law as laid down by this Court.
I shall now examine briefly the relevant decisions laying down the principle governing bonus to ascertain whether the impugned agreement is in any way inconsistent with them.
In Muir Mills Co. Limited vs Suti Mills Mazdoor Union, Kanpur (1) this Court defined the term "bonus" and laid down the conditions which would give rise to the claim for bonus.
Bhagwati, J., after considering the relevant decisions and text books on the subject, accepted the following definition of "bonus" given by the Textile Labour Inquiry Committee: "The term bonus is applied to a cash payment made in addition to wages.
It generally represents the cash incentive given conditionally on certain standards of attendance and efficiency being attained.
" The learned Judge then proceeded to state at p. 998 thus: "There are however two conditions which have to be satisfied before a demand for bonus can be justified and they are: (1) when wages fall short of the living standard and (2) the industry makes huge profits part of which are due to the contribution which the workmen make in increasing production.
The demand for bonus becomes an industrial claim when either or both these conditions are satisfied.
" The learned Judge then referred to the formula evolved by the Full Bench of the Labour Appellate Tribunal in the Mill Owners ' Association, Bombay vs Rashtreeya Mill Mazdoor Sangh, Bombay (2) and narrated the first charges on the gross profits as laid.
down by (1) ; (2) 27 that decision.
The learned Judge then expressed his view thus at p. 999: "It is therefore clear that the claim for bonus can be made by the employees only if as a result of the joint contribution of capital and labour the industrial concern has earned profits.
If in any particular year the working of the industrial concern has resulted in loss there is no basis nor justification for a demand for bonus.
Bonus is not a deferred wage." This decision lays down in clear terms that the payment of bonus is linked with profits.
But this decision was given in a dispute between one specified mill, namely, Muir Mills Co. Limited and the Union, representing its employees.
This Court was not considering a case of a bonus claim on industry cum region basis.
The principle of the decision, namely, that the claim for bonus is linked with profits, may equally apply to such a case; but the working of the principle must necessarily depend upon the peculiarities of such a claim.
Industrial law is in the process of evolution and it cannot be put in a straight jacket, but must be allowed to grow to meet varying situations that present themselves to industrial tribunals, subject of course to the statutory provisions and the general principles laid down by courts.
The application of the principles laid down by this decision to a bonus claim on industry cum region basis would, to some extent, be different from its application to a single unit.
I shall consider this aspect at a later stage of the judgment.
It is unnecessary to consider the other decisions on this subject except the recent decision of this Court in The Associated Cement Companies Ltd., Dwarka Cement Works, Dwarka vs Its Workmen That decision reviewed the entire law on the subject vis a vis the profit bonus.
It accepted the principles laid down by the said Full Bench Formula and elaborately considered the mode of application of the prin.
ciples for ascertaining the "available surplus.
" Gajendragadkar, J., who spoke for the Court, referred to the earlier decision and restated the basis for awarding bonus thus at p. 995: (1) 28 "We have already noticed that the formula for awarding bonus to workmen is based on two considerations: first, that labour is entitled to claim a share in the trading profits of the industry because it has partially contributed to the same; and second, that labour is entitled to claim that the gap between its actual wage and the living wage should within reasonable limits be filled up.
" Then the learned Judge, after referring to the earlier decisions, gave the various amounts that should be deducted from the bonus year 's profits and the 'manner in which they should be done to ascertain the "available surplus." According to the learned Judge the following items have to be deducted: "(1) Depreciation, which should be the notional normal depreciation.
(2) Income tax.
(3) A return on paid up capital as well as working capital.
Though the usual rates were mentioned, it was made clear that the rates were not inflexible but would vary according to the circumstances of each case.
(4) Rehabilitation: For ascertaining the amount necessary for rehabilitation, it was pointed out that a multiplier and divisor should be adopted; the former to ascertain the probable price which may have to be paid for the rehabilitation, replacement or modernization of machinery, and the latter in order to ascertain the annual requirement of the employer in that behalf year by year.
" Out of the balance, which was described as "available surplus", it was stated that three parties, namely, the labour, the industry and the shareholders, were entitled to claim shares.
This is the broad picture drawn by that decision for fixing the bonus.
That decision, therefore, restated the pre existing law and reaffirmed the doctrine that bonus is linked with profits and also the Full Bench Formula for ascertaining the "available surplus".
That decision was also not concerned with a claim for bonus on industry cum region basis, but only with a claim in regard to a particular unit.
It also did not lay down that employer and 29 employee could not agree in regard to the distribution of the available surplus or in respect of the amount required for rehabilitation.
It also did not purport to prevent the parties from agreeing on the payment of bonus linked with profits on industry cum region basis spread over a number of years.
Some of the observations in the judgment indicate the consciousness of the court that the formula accepted or the directions given therein could not meet every conceiv able situation that might arise in the complicated field of industrial relations.
Does the impugned pact contravene the law laid down by this Court? It is contended that it infringes the law mainly in three respects, namely, (i) bonus was payable thereunder by a mill incurring loss; (ii) the pact did not provide for rehabilitation of the post 1947 block; and (iii) the depreciation and the interest on the reserves allowed were not in accordance with the formula.
The first objection appears to be plausible and has also been upheld by my learned brethren.
But, in my view, there is a fallacy underlying it.
The contention invokes the law of bonus laid down in respect of an industrial claim for bonus for a particular year made by the employees of a single mill and seeks to apply it to a case of an agreement evolving a scheme of bonus on the basis of industry cum region spread over a reasonable period of time.
Though the fundamental principle, namely, that bonus is linked with profits, applies to both, the application of the same to two different situations must necessarily differ.
The short question is whether under the impugned agreement the claim for bonus was not based on profits.
The agreement was a multilateral one involving mutual obligations.
It was on industry cum region basis, that is, it was entered into between the employers of the entire industry and the employees thereof.
The basis of the agreement was that the entire industry would make a profit.
For the purpose of convenient payment of bonus it was worked out on the unit basis.
All the parties to the agreement, the employers and the 30 employees of different mills in Ahmedabad, desired in dustrial peace in order to build up the textile industry.
The industry comprised many units with varying prospects and different strata of financial stability and prosperity.
Some mills may earn profits throughout the period, some may earn profits in some years and incur loss in other years and under extremely unfortunate and unexpected circumstances, a mill may incur loss throughout.
Though a,particular mill may earn abnormal profits, another mill may be just able to make its both ends meet and another may have a narrow margin of profits or even incur loss.
But all of them were sincerely interested in the general prosperity of the industry as a whole in the said area which would have its repercussions on individual units.
A mill which earns large profits may have to pay more than 25 per cent.
of basic wages for the year as bonus and a mill which incurs loss may not have to pay bonus at all.
The employees of a particular mill may be entitled in a particular year, having regard to the profits, to get bonus far in excess of 25 per cent.
of the basic wages.
But in the general interest of all concerned, they were all willing to make a little sacrifice for the common good.
Each mill undertook the liability to pay bonus to its employees with a minimum and maximum limits in consideration of a similar undertaking of liability by other mills.
So too, the employees, in consideration of a minimum bonus being guaranteed to them, agreed not to claim more than the maximum fixed and the mills as a whole guaranteed payment of the minimum bonus.
But what is important to remember is that the entire scheme of payment of bonus was linked with profits.
It would be paid on the basis of profits earned or to be earned by a mill.
If a mill did not make profits in a particular year, bonus would be paid on account to be adjusted in subsequent years.
The formula of "set on" and "set off" emphasizes the integral connection between bonus and profits, and the fact that the total loss incurred by a particular mill during the entire period may break that formula does not affect the basis of 31 the agreement.
In effect and substance, under the agreement, each of the mills agreed for a consideration on the happening of a contingency to treat certain amounts as notional profits adequate to pay the minimum bonus with a right to "set off" in subsequent years against larger profits, if any, earned by them.
In the premises, it is not correct to state that bonus is not linked with profits for four reasons, namely, (i) the agreement was between the employers and employees of the entire textile industry in Ahmedabad; (ii) the basis of the agreement was that the industry as a whole would make a profit; there is nothing illegal in parties to the agreement, who had ,intimate knowledge of the financial position of the entire industry, from accepting that position; (iii) instead of the profits of the entire industry being ascertained and bonus paid to all the employees, under the agreement, each mill for a consideration, namely, obligations undertaken by other parties, agreed to pay bonus ranging between a maximum and a minimum; and (iv) each mill also agreed for a consideration, even if in fact it incurred a loss in a particular year.
, to set apart a notional amount as profits adequate to pay the minimum bonus with a right to readjust its bonus account in subsequent years.
In this view the impugned pact does not contravene the law of the land for the simple reason that there is no decision of this Court which prevents the making of ouch agreements so long as the fundamental principle is not violated; and in this case, for the reason given by me, I am of the view that the said principle, viz., that bonus should be linked with profits has been adhered to in the agreement.
Now let us see whether the Full Bench Formula in regard to rehabilitation has been contravened by the impugned pact.
The main emphasis is on the want of a provision in the agreement in regard to valuation of the block subsequent to 1947.
In The Associated Cement Companies ' case (1) this Court observed at p. 971 thus: "it has also been observed by the Labour Appellate Tribunal that if an appropriate multiplier and (1) 32 divisor are determined they are generally used because the tribunals take the view that the reconsideration of the said multiplier and divisor should not be hastily undertaken and could be justified only on the basis of a stable character extending or likely to extend over a sufficient number of years so as to make a definite and appreciable difference in the cost of replacement." The Industrial Court in the bonus.
case of the textile industry at Ahmedabad for the year 1949 fixed the cost of replacement of the block of the entire industry at Ahmedabad at Rs. 33.89 crores spread over 15 years from 1947.
The Industrial Court, on the material placed before it, fixed the multiplier at 2.7 and the divisor at 15.
The result is that the cost of the machinery and building as it existed in 1947 was multiplied by 2.7 and after making the necessary deduction therefrom, such as that of depreciation and reserves available and the breakdown value of machinery, divided the surplus by 15 years.
Ordinarily, change in the said multiplier and divisor, as laid down by this Court, should not be hastily undertaken and could be justified only on the basis of a substantial change of a stable character extending or likely to extend over a sufficient number of years.
In the impugned pact the parties agreed to abide by the said multiplier and divisor and they did not think fit to revise the same.
The decisions of this Court do not preclude employers and employees from agreeing to a particular valuation of the block or to their agreeing to a particular multiplier and 'divisor having regard to the circumstances obtaining at the time of the agreement.
Nor does the agreement infringe any of the principles laid down by the Full Bench Formula in the matter of fixing the prior charges.
A perusal of paragraph 2(a) of the agreement shows that the prior charges mentioned therein are only those that are stated in the Full Bench Formula, though there is certainly a difference in the particulars under different heads, such as, interest, etc.
Certainly the decisions of this Court do not preclude the parties from 33 agreeing to certain amounts or to certain rates under different heads of prior charges.
As the agreement does not infringe the law laid down by this Court, it cannot be contended that the Industrial Court could not extend the said agreement, if it is necessary to secure industrial peace for another year.
In effect and substance, the Industrial Court adopted the said agreement as a part of the award by giving it a span of six years instead of five years; with the result that the entire formula of "set on" and "set off" would automatically apply in the sixth year.
Courts have held that Industrial Courts have power to extend agreements in appropriate circum stances.
The Federal Court of India in Western India Automobile Association vs Industrial Tribunal, Bombay (1) explained the scope of industrial adjudication and the functions of an industrial tribunal in labour disputes thus at p. 345: "Adjudication does not, in our opinion, mean adjudication according to the strict law of master and servant.
The award of the Tribunal may contain provisions for settlement of a dispute which no Court could order if it was bound by ordinary law, but the Tribunal is not fettered in any way by these limitations.
In Volume 1 of 'Labour Disputes and Collectiv e Bargaining ' by Ludwig Teller, it is said at page 536, 'that industrial arbitration may involve the extension of an existing agreement or the making of a new one, or in general the creation of new obligations or modifications of old ones, while commercial arbitration generally concerns itself with interpretation of existing obligations and disputes relating to existing agreements '.
In our opinion, it is a true statement about the functions of an Industrial Tribunal in labour disputes." The same view in different phraseology has been expressed by this Court in Bohtas Industries Limited vs Brijnandan Pandey (2), section K. Das, J., speaking for the Court, observed at p. 810 thus: (1) [1949] F.C.R 321.
(2) ; 5 34 "A Court of law proceeds on the footing that no power exists in the courts to make contracts for people; and the parties must make their own contracts.
The courts reach their limit of power when they enforce contracts which the parties have made.
An Industrial Tribunal is not so fettered and may create new obligations or modify contracts in the interests of industrial peace, to protect legitimate trade union activities and to prevent unfair practice or victimization.
We cannot, however, accept the extreme position canvassed before us that an Industrial Tribunal can ignore altogether an existing agreement or existing obligations for no rhyme or reason whatsoever." This Court again reiterated the same principle in the case of Patna Electricity Supply Co. Limited (1) thus at p. 1038: "There is no doubt that in appropriate cases industrial adjudication may impose new obligations on the employer in the interest of social justice and with the object of securing peace and harmony between the employer and his workmen and full cooperation between them.
This view about the jurisdiction and power of Industrial Tribunals has been consistently recognized in this country since the decision of the Federal Court in Western India Automobile Association vs Industrial Tribunal, Bombay (2)".
These authorities clearly establish the proposition that an Industrial Tribunal can extend an existing agreement or make a new one if, for good reasons, it comes to the conclusion that such extension promotes industrial peace.
If, as I have held, the impugned pact was lawful and did not contravene the law laid down by this Court, the Industrial Court in the present case was certainly within its rights to extend that pact for another year for the very good reasons given by it for doing so.
I shall now state my view in the form of the following propositions: (1) Neither the Full Bench Formula nor the decisions of this Court affirming it preclude an (1) [1959] SUPP.
2 S.C.R. 76r.
(2) 35 Industrial Court in appropriate cases from extending the terms of a pact by another year if that was necessary to maintain industrial peace.
(2) The law laid down by the Federal Court and the Supreme Court recognizes such a power in an Industrial Court.
(3) The fact that the subsequent block has not been valued does not affect the question, for the parties can certainly agree, for various reasons, that the value of the existing block should govern the situation for a specified period.
(4) The impugned five year pact is not contrary to industrial law as laid down by this Court; indeed, it expressly followed the principles laid down in the Full Bench Formula which was subsequently affirmed by this Court in the case of Associated Cement Companies (1).
(5) The impugned pact also does not infringe the principle that bonus depends upon profits; but it applied the same by evolving a formula of "set on" and "set off" to a complicated situation of the entire industry in a particular area for a number of years.
For the foregoing reasons, and in view of the aforesaid definite findings of the Industrial Court, I hold that this is eminently a fit case for extending the agreement for the bonus year 1958.
Before closing I must express my appreciation of the way in which the impugned pact was brought about between the parties.
It is in the interest of both the employers and the employees while the employees of every mill are assured of payment of a minimum bonus, the employers of every mill also are assured protection against extravagant claims.
The agreement avoided complicated and acrimonious disputes in courts every year in regard to bonus.
The working of this agreement certainly helped the mills to achieve the introduction of schemes of rationalization.
The agreement has become a model one for other mills.
Ironically the Full Bench Formula, affirmed by this Court in the case of Associated Cement Companies Limited (1), mainly evolved to fix the amount required for rehabilitation in the interest of industrial peace, turned out to be the sheet anchor for (1) 36 the employers to depart from the path of negotiation and agreement which they were following all these years and to enter the arena of open fight with the employees.
It may be, though it may turn out to be wrong, that they are under the belief that the Full Bench Formula, if strictly followed, would not leave any surplus and that they need not pay any bonus to the employees.
This attitude is neither reasonable nor in the interest of industrial peace.
I hope and trust that the parties, in spite of the temporary success in these appeals, would see better light and settle their disputes as they had been doing all these years.
In the result, the appeals fail and are dismissed with costs.
By COURT : In accordance with the opinion of the majority, the appeals are allowed and the matter sent back to the Tribunal for disposing of the issue before it in accordance with law.
We direct that the Tribunal should proceed to try the question whether any bonus should be awarded to the employees of the eighteen mills before us on the basis of the Full Bench Formula as interpreted by this Court in the case of The Associated Cement Companies (1).
In the circumstances, there will be no order as to costs.
Appeals allowed.
Cases remanded to the Tribunal.
[/INST]It is not correct to say that section 79 of the , standardises the grant of annual leave with wages to employees to whom the Act applies and that neither the employer by voluntary agreement nor the Industrial Tribunal by its award can vary that standard.
It is well settled that in construing the provisions of a welfare legislation, such as the Act in question which has for its object the preservation of the health, safety and welfare of the workmen, courts should apply the rule of beneficent construction and moreover, sections 78 and 84 of the Act put it beyond doubt that section 79(1) is not intended to standardise annual leave with wages by providing the maximum.
Rightly construed section 78(1) of the Act not only protects past laws, awards, agreements and contracts but also those that are to come into existence in the future and does not prohibit a more generous agreement than that prescribed by section 79(1).
Likewise the scope of section 84 of the Act which, in empowering the State to exempt a factory from all or any provisions of Ch.
VIII of the Act, contemplates better amenities than those guaranteed by the Chapter, cannot be limited to benefits existing at the date of the Act but must also apply to future benefits which an employer may grant to his employees.
Consequently, in a case where the Industrial Tribunal, on a consideration of awards and agreements between employers and employees in comparable concerns, awarded annual leave in excess of what is prescribed by section 79(1), Held, that the award was not open to challenge.
Held, further, that the distinction generally made between operatives doing manual work and clerical and other staff is perfectly justifiable and so the award of privilege leave to the clerical staff could not be said to be discriminatory.
Although the Industrial Tribunals in awarding privilege leave or sick leave must not fail to consider their effect on production and so on the interest of the community in general, this Court would be reluctant under article 136 of the Constitution to interfere with an award unless its provisions are unsustainable on any reasonable grounds and make a violent departure from the practice and trend prevailing in comparable concerns.
38 298
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<s>[INST] Summarize the judgementION: Civil Appeal No. 495 of 1984.
From the Judgment and order dated 1.11.1983 of the Delhi High Court in L.P.A. No. 160 of 1983.
P. P. Rao and A. Mariaputham for the Appellant.
Dr. Anand Prakash, D.N. Dwivedi, Mrs. Anil Katiyar, C.V. Subba Rao, Vineet Kumar and Deepak K. Thakur for the Respondents.
The Judgment of the Court was delivered by RANGANATH MISRA, J.
This appeal by special leave calls in question the judgment of a Division Bench of the Delhi High Court in a Letters Patent Appeal upholding the decision of a learned Single Judge rejecting the writ petition of the appellant.
The appellant was an employee of the Institute of Constitutional and Parliamentary Studies (hereafter referred to as ICPS for short) and in a disciplinary action he was dismissed from service by order dated 17th November, 1982.
When he assailed the order in a writ petition before the High Court, the question whether lCPS was 'State ' within the meaning of Article 12 of the Constitution came for consideration as the major issue arising in the matter.
The learned Single Judge dismissed the writ petition by holding that the employer was neither an agency nor an instrumentality of the Government and did not constitute 'State ' within the meaning of Article 12 and, therefore, was not subject to the writ jurisdiction of the High Court.
The appeal against the judgment of the learned Single Judge was dismissed on 1st November, 1983.
In course of hearing of the appeal Dr. Anand Prakash appearing for ICPS fairly stated that whether the Institute be 'State ' or not within the meaning of Article 12 of the Constitution, the employer 264 was prepared to give a fresh opportunity to the appellant to meet the charges so as to dispel from his mind the feeling that he has not been given reasonable opportunity to defend himself.
Ordinarily, with that concession the impugned order entailing the dismissal of the employee and the judicial determination against the appellant should have been set aside and the matter should have gone before the enquiry officer for affording reasonable opportunity to the appellant of being heard against the charges.
Dr. Anand Prakash, however, invited us to enter into the merits of the issue as to whether ICPS constitutes 'State ' within the constitutional meaning of the term The Union of India which appears before us through counsel also wanted that the question should be decided.
Thereupon we suggested to the appellant who was till then appearing in person to get represented through counsel so that the matter could be appropriately argued on his behalf also.
He has been rendered suitable assistance by the Supreme Court Legal Aid Committee and Mr. P.P.Rao, Senior Counsel, has appeared on his behalf.
The main question for consideration now, therefore, is whether ICPS is 'State '.
For appropriate consideration of this question it is necessary to look into the constitution of the body, the purpose for which it has been created, the manner of its functioning including the mode of its funding and the broad features which have been found by this Court in several decisions to be relevant in the matter of determining a dispute of this type.
Article 12 of the Constitution provides an inclusive definition of the term 'State ' by saying: "In this part, unless the context otherwise requires, 'the State ' includes the Government and Parliament of India and the Government and the State Legislature of each of the States and all local or other authorities within the territory of India or under the control of the Government of India.
" obviously ICPS can become 'State ' only if it is found to be an authority within the territory of India or under the control of the Government of India.
ICPS, respondent No.2, is a society registered under the Societies Registration Act, 21 of 1860, and was registered on 9th March, 1965.
As would appear from its Memorandum of Association, the foundation members were 19 in number 13 being members besides a President and five Vice Presidents.
The first President of the Soci 265 ety was the then Speaker of the Lok Sabha.
The five Vice Presidents were the then Minister of Railways, Minister of Law and Social Security Minister of Communication and Parliamentary Affairs, a former (Chief Justice of India and a former Attorney General of India.
Dr. L.N. Singhvi, then a member of the Lok Sabha, was its Executive Chairman.
The Public Trustee in the Department of Company Affairs and Insurance in the Ministry of Finance was the Director and a member of the Lok Sabha was the Society 's Treasurer.
The then Minister of Cultural Affairs in the Ministry of Education along with three members of the Lok Sabha, a Senior Advocate of the Supreme Court, a member of the Rajya Sabha, the then Vice Chancellor of Rajasthan University.
the respective Secretaries of the Lok Sabha and the Rajya Sabha Secretariat and the Secretary in the Ministry of Law were its Members.
The registered office of the Society was initially located within the Parliament House but was later on shifted to the Vithalbhai Patel House, Rafi Marg, New Delhi .
The objects of the Society inter alia were: ( I) to promote and provide for constitutional and Parliamentary studies with special reference to comparative studies in constitutional systems of various countries and working of the Indian Constitution and parliamentary and governmental institutions in their various aspects; (2) to undertake study of courses and fundamental research relating to developments in constitutional law, conventions and practices, parliamentary procedure, legislative drafting, trends in judicial interpretation and allied matters; (3) to organise inter alia training programmes in constitutional problems and matters of current parliamentary importance; (4) to set up a legislative research and reference service for the benefit of all interested members of the Union Parliament and State Legislature irrespective of their party affiliations; (5) to undertake and provide for the publication of a journal and of research papers and of books and brochures with a view to disseminate democratic values and to foster broad based civic education and awareness, and in particular, to pro.
mote study of constitutional and parliamentary affairs; 266 (6) to establish and maintain libraries and information services to facilitate the study of constitutional and parliamentary subjects and spread information in regard thereto; (7) to invite as and when feasible, scholars who may or may not be members of the Society, to take advantage of the facilities offered by the Society and to benefit the Society by their knowledge and experience; and (8) to institute appropriate fellowships, offer prizes and arrange scholarships and stipends in furtherance of the objects of the society.
The Memorandum permitted the Society to accept gifts, donations and subscriptions of cash and securities and of any property either movable or immovable.
The rule classifies the members under heads like Founder Members, Life Members, Honorary Members, ordinary Members, Corporate Members and Associate Members.
ordinary membership, according to the Rules, would extend to Members of Parliament or of any State Legislature or those who have been or are members of the Judiciary or advocates of the Supreme Court or the High Courts or persons employed in public service or persons engaged in teaching of study of social sciences particularly of Political Science, Law or subjects related thereto.
In the category of Honorary Members were the President, the Vice President and the Prime Minister of India.
Though the Memorandum permitted receipt of gifts and donations from outside, it is not disputed that the main source of income of the society has been the annual Central Government grant.
We think it appropriate at this stage to turn attention to judicial precedents to find out as to what should be the test to be applied for determining when on institution like respondent No.2 would be treated as 'other authorities ' under Article 12 of the Constitution.
The first in point of time is the Constitution Bench judgment in the case of Rajasthan State Electricity Board, Jaipur vs Mohan Lal & Ors., ; Bhargava, J. who delivered the main judgment observed: "the meaning of the word 'authority ' given in Webster 's Third New International Dictionary, which can be applicable, is a "public administrative agency or corporation having quasi governmental powers and authorised to 267 administer a revenue producing public enterprise." This dictionary meaning of the word 'authority ' is clearly wide enough to include all bodies created by a statute on which powers are conferred to carry out governmental or quasi governmental functions.
The expression "other authorities" is wide enough to include within it every authority created by a statute and functioning within the territory of India, or under the control of the Government of India; and we do not see any reason to narrow down this meaning in the context in which the words 'other authorities ' are used in Article l 7 of the Constitution In Smt.
Ujjam Bai vs State of Uttar Pradesh, Ayyangar, J. had observed: "Again Article 12 winds up the list of authorities falling within the definition by referring to 'other authorities ' within the territory of India which cannot obviously be read as ejusoem generis with either the Government and the Legislatures or local authorities.
The words are of wide amplitude and capable of comprehending every authority created under a statute and functioning within the territory of India or under the control of the Government of India.
Shah, J., as he then was, added a note to the leading Judgment of Bhargava and observed: "I am unable, however, to agree that every constitutional or statutory authority on whom powers are conferred by law is 'other authority ' within the meaning of Article 12.
The expression 'authority ' in its etymological sense means a body invested with power to command or give an ultimate decision, or enforce obedience, or having a legal right to command and be obeyed.
In determining what the expression 'other authority ' in Article 12 connotes, regard must be had not only to the sweep of fundamental rights over the power of the authority, but also to the restrictions which may be imposed upon the exercise of certain fundamental rights (e.g., those declared by Article 19) by the authority.
Fundamental rights within their allotted fields trans 268 cend the legislative and executive power of the sovereign authority.
But some of the important fundamental rights are liable to be circumscribed by the imposition of reason able restrictions by the State.
The true content of the expression 'other authority ' in Article 12 must be deter mined in the light of this dual phase of fundamental rights.
In considering whether a statutory or constitutional body is an authority within the meaning of Article 12, it would he necessary to bear in mind not only whether against the authority fundamental rights in terms absolute are intended to be anforced, but also whether it was intended by the Constitution makers that the authority was invested with the sovereign power to impose restrictions on very important and basic fundamental freedoms.
In my judgment, authorities, constitutional or statutory invested with power by law but not sharing the sovereign power do not fall within the expression 'State ' as defined in Article 12.
Those authorities which are invested with sovereign power, i.e., power to make rules or regulations and to administer or enforce them to the detriment of citizens and others fall within the definition of 'State ' in Article 12, and constitutional or statutory bodies which do not share that sovereign power of the State are not, in my judgment, 'State ' within the meaning of Article 12 of the Constitution.
Two cases, the First of Sabhajit Tewary vs Union of India & Ors., and the other of Sukhdev Singh & Ors vs Bhagatram Sardar Singh Raghuvanshi & Anr., l 19 were disposed of by the same Constitution Bench on February 21, 1975.
In both these cases, the true meaning of Article 12 of the Constitution fell for consideration.
Sabhajit Tewary 's case was one where the status of the Council of Scientific and Industrial Research was examined.
This Court took note of the fact that the Council was a society registered under the Societies Registration Act.
Under Rule 3, the Prime Minister of India was the ex officio President of the Society and under Rule 30 the governing body consisted of persons appointed by the Government of India representing the administrative ministry under which the Council of Scientific and Industrial Research is included and the Ministry of Finance.
The Court also took note of the manner in which the affairs of the Society including funding were conducted.
Ray, CJ.,in the brief judgment that the 269 Court delivered in the case observed: A "Extracting the features as aforesaid, it was contented that these would indicate that the Council of Scientific and industrial Research was really an agency of the Government.
This contention is unsound.
The society does not have a statutory character like the oil and Natural Gas Commission, or the Life Insurance Corporation or Industrial Finance Corporation.
It is a society incorporated in accordance with the provisions of the Societies Registration Act.
The fact that the Prime Minister is the President or that the Government appoints nominees to the governing body or that the Government may terminate the membership will not establish anything more than the fact that the Government takes special care that the promotion, guidance and cooperation of scientific and industrial research, the institution and functioning of specific researches, establishment or development and assistance to special institutions or departments of the existing institutions for scientific study of problems affecting particular industry in a trade, the utilisation of the result of the researches conducted under the auspices of the Council towards the development of industries in the country are carried out in a responsible manner.
This Court has held in Praga Tools Corporation vs C.A. Imanual & Ors., ; ; Heavy Engineering Mazdoor Union vs The State of Bihar & Ors., and in S.L. Aggarwal vs General Manager, Hindustan Steel Ltd., ; that the Praga Tools Corporation, Heavy Engineering Mazdoor Union and Hindustan Steel Ltd. are all companies incorporated under the Companies Act and the employees of these companies Act and the employees of these companies do not enjoy the protection available to Government servants as contemplated in Article 311.
The companies were held in these cases lo have independent existence of the Government and by the law related to corporations.
These could not be hold to be departments of the Government.
" The ratio of this decision has been fully relied upon by the High Court in dismissing the claim of the appellant.
270 In Sukhdev Singh 's case (supra) the leading judgment was delivered also by Ray, CJ.
Two questions fell for consideration ( l) whether an order of.
removal from service contrary to Regulations would enable the employee to a declaration against the statutory corporation of continuance in service or would it end up in claim for damages only and (2) whether the employee of a statutory corporation is entitled to claim protection of Articles 14 and 16 against the Corporation.
The Court, therefore, straight went into the question as to whether statutory corporations were authorities within the meaning of Article 12.
As a fact, three corporations being the oil and Natural Gas Commission, the Life Insurance Corporation and the Industrial Finance Corporation were before the Court and each one of them had been set up under a special statute.
At page 641 of the Reports, the learned Chief Justice pointed out: "In the background of the provisions of the three Acts under consideration, the question arises as to whether these Corporations can be described to be authorities within the meaning of Article 12 of the Constitution . " At page 642 of the Reports the conclusion was reached to the effect that "these statutory bodies are 'authorities ' within the meaning of Article 12 of the Constitution.
" We are really concerned with what Mathew J., added to the judgment He observed: "The test propounded by the majority is satisfied so far as the oil and Natural Gas Commission is concerned as section 25 of the oil and Natural Gas Commission Act provides for issuing, binding direction to third parties not to prevent the employees of the Commission from entering upon their property if the Commission so directs.
In other words, as section 25 authorises the Commission to issue binding directions to third parties not to prevent the employees of the Commission from entering into their land and as disobedience of such directions is punishable under the relevant provision of the Indian penal Code since those employees are deemed to be pubic servants under section 21 of the Indian Penal Code by virtue of section 27 of the Act, the Commission is an 'authority ' within the meaning of the expression 'other authorities ' in Article 12 271 Though this would be sufficient to make the commission a 'State ' according to the decision of this Court in the Rajasthan Electricity Board case (supra), there is a larger question which has a direct bearing so far as the other two corporations are concerned, viz., whether, despite the fact that there are no provisions for issuing binding directions to third parties the disobedience of which would entail penal consequences, the corporations set up under statutes to carry on business of public importance of which is fundamental to the life of the people can be considered as 'State ' within the meaning of Article 12.
" Mathew, J. referred to the precedents and other authorities from England, France and United States and at page 654 of the Reports stated: "The ultimate question which is relevant for our purpose is whether such a corporation is an agency or instrumentality of the government for carrying on a business for the benefit of the public.
In other words, the question is, for whose benefit was the corporation carrying on the business? When it is seen from the provisions of that Act that on liquidation of the corporation, its assets should be divided among the shareholders, namely, the Central and State governments and others, if any, the implication is clear that the benefit of the accumulated income would go to the Central and State Governments.
Nobody will deny that an agent has a legal personality different from that of the principal.
The fact that the agent is subject to the direction of the principal does not mean that he has no legal personality of his own . . .
The crux of the matter is that public corporation is a new type of institution which has sprung from the new social and economic functions of government and that it therefore does not neatly fit into old legal categories.
Instead of forcing it into them, the later should be adapted to the needs of changing times and conditions.
I do not think there is any basis for the apprehension expressed that by holding that these public corporations are 'State ' within the meaning of Article 12, the employees of these corporations would become government servants.
I also wish to make it clear that I express no opinion on 272 the question whether private corporations or other like organisations, though they exercise power over their employees which might violate their fundamental rights, would be 'State ' within the meaning of Article 12.
" Then comes the case of Ramana Dayaram Shetty vs The International Airport Authority of India & Ors., ; The question before the Court was whether the International Airport Authority of India was 'State ' within the meaning of Article 12 so as to be subjected to enforcement of fundamental rights against it.
Examining this aspect, Bhagwati, J., as he then was spoke for the three Judge Bench thus: "Now it is obvious that the government which represents the executive authority of the State , may act through the instrumentality or agency of natural persons or it may employ the instrumentality or agency of judicial persons to carry out its functions.
In the early days, when the Government had limited functions it could operate effectively through natural persons constituting its civil service and they were found adequate to discharge governmental functions, which were of traditional vintage.
But as the tasks of the government multiplied with the advent of the welfare State, it began lo be increasingly felt that the frame work of civil service was not sufficient to handle the new tasks which were often of specialised and highly technical character.
The inadequacy of the civil service to deal with these new problems came to be realised and it became necessary to force a new instrumentality or administrative device for handling these new problems.
It was in these circumstances and with a view to supplying this administrative need that the public corporation came into being as the third arm of the Government.
As early as 1819 the Supreme Court of the United States in Mac Cullough v .
Maryland, (4 Wheat 315) held that the Congress has power to charter corporations as incidental to or in aid of governmental functions and , as pointed out by Mathew J., in Sukhdev vs Bhagat Ram, (supra) such federal corporations would ex hypothesi be agencies of the Government.
In Great Britain too, the policy of public administration through separate corporations was gradually evovled and the conduct of basic industries through giant corporations has now become a permanent feature 273 of public life.
So far as India is concerned, the genesis of the emergence of corporations as instrumentalities or agencies of Government is to be found in the Government of India Resolution on Industrial Policy dated with April, 1948 where it was stated inter alia that 'management of state enterprises will as a rule be through the medium of public corporation under the statutory control of the Central Government who will assume such powers as may be necessary to ensure this. ' It was in pursuance of the policy envisaged in this and subsequent resolutions on Industrial policy that corporations were created by Government for setting up and management of public enterprises and carrying out other public functions.
Ordinarily, these functions could have been carried out by Government departmentally through service personnel, but the instrumentality or agency of the corporations was resorted to in these cases having regard to the nature of the task to be performed.
The corporations acting as instrumentality or agency of Government would obviously be subject to the same limitations in the field of constitutional and administrative law as Government itself, though in the eye of the law, they would be distinct and independent legal entities.
If the Government acting through its officers is subject to certain constitutional and public law limitations, it must follow a fortiori that Government acting through the instrumentality or agency of corporations should equally be subject to the same limitations.
But the question is how to determine whether a corporation is acting as instrumentality or agency of Government.
It is a question not entirely free from difficulty.
" It was again pointed out in the same case that: "A corporation may be created in one of two ways.
It may be either established by statute or incorporated under a Law such as the or the .
Where a corporation is wholly controlled by Government not only in its policy making but also in carrying out the functions entrusted to it by the law establishing it or by the Charter of its incorporation, there can be no doubt that it would be an instrumentality or agency of Government . " 274 The Court further stated: "But the public nature of the function, if impregnated with governmental character or 'tied or ent wined with government ' or fortified by some other additional factor may render the corporation an instrumentality or agency of Government.
Specifically, if a department of Government is transferred to a corporation, it would be a strong factor supportive of this inference.
It will thus be seen that there are several factors which may have to be considered in determining whether a corporation is an agency or instrumentality of Government.
We have referred to some of these factors and they may be summarised as under: whether there is any financial assistance given by the State, and if so, what is the magnitude of such assistance whether there is any other form of assistance, given by the State, and if so whether it is of the usual kind or it is extraordinary, whether there is any control of the management and policies of the corporation by the State and what is the nature and extent of such control, whether the corporation enjoys State confer red or State protected monopoly status and whether the functions carried out by the corporation are public functions closely related to governmental functions This particularisation of relevant factors is however not exhaustive and by its very nature it cannot be, because with increasing assumption of new tasks growing complexities of management and administration and the necessity of continuing adjustment in relations between the corporations and Government calling for flexibility, adapt ability and innovative skills, it is not possible to make an exhaustive enumeration of the tests which would invariably and in all cases provide an unfailing answer to the question whether a corporation is governmental instrumentality or agency.
At page 1052 of the Reports the Court proceeded to consider whether International Airport Authority of India could be said to be an 'authority ' falling within the meaning of 'State ' in Article 12.
The constitution of the body, the manner of filling it up? Government 's power of control in the matter of appointment of members and termination of membership were utilised as tests for examining whether 275 the Airport authority was 'State '.
After referring to the special A aspects, the Court observed: "It will be seen from these provisions that there are certain features of the respondent which are eloquent and throw considerable light on the true nature of the first respondent.
In the first place, the Chairman and Members of the first respondent are all persons nominated by the Central Government and the Central Government has also the power to terminate their appointment as also to review them in certain specified circumstances.
The Central Government is also vested with the power to take away the management of any airport from the first respondent and to entrust it to any other person or authority and for certain specified reasons, the Central Government can also supersede the first respondent.
The Central Government has also power to give directions in writing from time to time on questions of policy and these directions are declared binding on the first respondent.
" Reference was made to the case of Sabhajit Tewary (supra).
Bhagwati, J. referring thereto stated : "This decision does not lay down any principle or test for the purpose of determining when a corporation can be said to be an authority.
If at all, any test can be gleaned from the decision, it is whether the corporation is really an agency of the Government." and ultimately it was held that the Authority was 'State ' under Article 12.
This case clearly approves the treatment of the matter by Mathew, J. in Sukhdev Singh 's case (supra).
The two Judge Bench in the case of Managing Director, Uttar Pradesh Warehousing Corporation & Anr.
vs Vinay Narayan Vajpayee, ; was cited but we do not consider it necessary to refer to the same.
On the other hand reference to the two later decisions of this Court may be more useful.
Those are Ajay Hasia etc.
vs Khalid Mujib Sehravardi & Ors. etc.
; , of a Constitution Beocll and the other is Som Prakash Rekhi vs Union of India & Anr., ; being a three Judge Bench decision.
It is pertinent to indicate that both the judgments were delivered on November 13, 1980.
276 In Ajay Hasia 's case an Engineering College was also a Society registered under the Jammu & Kashmir Registration of Societies Act, l898, and the question that fell for consideration was whether it was an authority within the meaning of Article 12.
The Court found that the Memorandum of Association of the Society in clause (3) set out the objects for which the Society was incorporated and they included among other things establishment of the college with a view to providing instructions and research in such branches of engineering and technology as the college may think fit and for the advancement of learning and knowledge in such branches.
Reference was made to the Memorandum of Association, the objects and the powers of the State Government to make appointments and to the fact that the State government with the approval of the Central Government had the power to take such action and to issue such directions as are necessary in respect of all matters relating to the functioning of the college as noticed in the review of the activities.
the Court also took note of the fact that the founding members of the society were enumerated in clause (9) of the memorandum and they were the Chairmen to be appointed by the State Government with the approval of the Central Government, two representatives of the State Government, one representative of the Central Government, two representatives of the All India Council for Technical Education to be nominated by the Northern Regional Committee, one representative of the University of Jammu & Kashmir, one nonofficial representative of each of the Punjab, Rajasthan, UttarPradesh and Jammu & Kashmir States and to be appointed by the respective Governments in consultation with the Central Government and the principal who shall also be the ex officio Secretary.
The rules of the Society were referred to with a view to finding out the details of functioning.
Sabhajit Tewary 's case was referred to and distinguished and the tests laid down in the International Airport Authority 's case (supra) were approved.
Ultimately the Court summarised the position as under: " The tests for determining as to when a corporation can be said to be an instrumentality or agency of Government may now be culled out from the judgment in the International Airport Authority 's case.
These tests ate not conclusive or clinching, but they are merely indicative indicia which have to be used with care and caution because while stressing the necessity of a wide meaning to be placed on the expression 'other authorities '.
it must be realised that it should not stretched so far as to bring in 277 every autonomous body which has some nexus with the Government within the sweep of the expression.
A wide enlargment of the meaning must be tempered by a wise limitation.
We may summarise the relevant tests gathered from the decision in the International Airport Authority 's case as follows: (1) "one thing is clear that if the entire share capital of the corporation is held by Government it would go a long way towards indicating that the corporation is an instrumentality or agency of (Government (2) "Where the financial assistance of the State is so much as to meet almost entire expenditure of the corporation, it would afford some indication of the corporation being inpregnated with governmental character. " (3) "It may also be a relevant factor whether the corporation enjoys monopoly status which is State conferred or State protected." (4) "Existence of deep and pervasive State control may afford an indication that the corporation is a State agency or instrumentality." (5) "If the functions of the corporation are of public importance and closely related to governmental functions, it would be a relevant factor in classifying the corporation as an instrumentality or agency of Government.
(6) "Specifically, if a department of Government is transferred to a corporation, it would be a strong factor supportive of this inference of the corporation being an instrumentality or agency of Government.
" The Court thereafter proceeded to say: "We may point out that it is immaterial for this purpose whether the corporation is created by a statute or under a statute.
The test is whether it is an instrumentality 278 or agency of the Government and not as to how it is created.
The inquiry has to be not as to how the juristic person is born but why it has been brought into existence.
The corporation may be a statutory corporation created by a statute or it may be a Government Company or a company formed under the or it may be a society registered under the or any other similar statute.
Whatever be its genetical origin, it would be an 'authority ' within the meaning of Article 12 if it is an instrumentality or agency of the Government and that would have to be decided on a proper assessment of the facts in the light of the relevant factors.
The concept of instrumentality or agency of the Government is not limited to a corporation created by a statute but is equally applicable to a company or society and in a given case it would have to be decided, on a consideration of the relevant factors, whether the company or society is an instrumentality or agency of the Government so as to come within the meaning of the expression 'authority ' in Article 12.
" At pages 99 and 100 of the Reports, the Constitution Bench referred to the facts of the particular case and came to hold that the society was an instrumentality or agency of the State.
In Som Prakash Rekhi 's case (supra) at page 137 of the Reports, Krishna Iyer, J. referred to the five tests and concluded by saying that: "The finale is reached when the cumulative effect of all the relevant factors above set out is assessed and once the body is found to be an instrument or agency of Government, the further conclusion emerges that it is 'State ' and is subject to the same constitutional limitations as Government At page 138 the criticism against the conclusions reached in the c, Airport Authority 's case was taken note of and the learned Judge observed: "There is no doubt that Bhagwati, J. broadened the scope of State under Article 12 and according to Shri G.B. Pai the observations spill over beyond the requirements of the case and must be dismissed as obiter.
" 279 Pathak, J., as he then was, added a brief note to the judgment by A saying: "I must confess to some hesitation in accepting the proposition that the Bharat Petroleum Corporation Limited is a 'State ' within the meaning of Article 12 of the Constitution.
But in view of the direction taken by the law in this Court since Ramana Dayarama Shetty vs International Airport Authority I find I must lean in favour of that conclusion.
I would have welcomed a wider range of debate before us on the fundamental principles involved in the issue and on the implications flowing from the definition in the of a 'Government Company '? but perhaps a future case may provide that.
" We have thus the tests available in the two decisions to be applied to the facts of the case in hand for determination as to whether ICPS is 'State ' within the meaning of Article 12.
There are two more cases to which brief reference may now be made B.S. Minhas vs Indian Statistical Institute & Ors., ; and P.K. Ramachandra Iyer & Ors.
vs Union of India & Ors.
, ; The case of the Indian Statistical Institute is also of a society registered under the .
The Court found that the entire money required for funding the Institute was provided by the Central Government and even if any other money was to be received by the Institute it could be done only with the approval of the Central Government and the accounts of the Institute were to be submitted to the Central Government for its scrutiny and satisfaction.
The Society had to comlpy with all directions as may be issued by the Central Government. 'The control of the Central Government was deep and pervasive and, therefore, it was an instrumentality of the Central Government and as such was an authority within the meaning of Article 12 of the Constitution.
ln coming to this conclusion, the Court relied upon the tests indicated in the International Airport Authority 's case as also in the case of Ajay Hasia.
In Ramchandra Iyer 's case, the question for consideration was whether the Indian Council of Agricultural Research (ICAR) was a set up within the meaning of Article 12 of the Constitution.
ICAR is also a Society registered under the .
The Court found that when it was set up, it was an attached office of the 280 Government of Tndia and had not undergone any change when it got transferred into a Society.
Applying the tests indicated in International Airport Authority case as also the case of Ajay Hasia, the Court came to the conclusion that there was little doubt that it was an instrumentality or agency of the State.
It further stated: "ICAR came into existence as an integral department of the Government of India and later on became an attached office of the Central Government.
The composition of the ICAR as evidenced by Rule 3 could not have been more governmental in character than any department of the Government.
" It is time to turn to the facts of the present case to find out as to what the conclusion should be when the tests formulated by the several cases of this Court referred to above are applied.
There cannot indeed be a strait jacket formula.
It is not necessary that all the tests should he satisfied for reaching the conclusion either for or against r holding an institution to be 'State '.
In a given case some of the features may emerge so boldly and prominently that a second view may not be possible.
There may yet be other cases where the matter would be on the border line and it would be difficult to take one view or the other outright.
Our struggle for independence which spread over a century bore fruit in 1947.
During the long period of struggle, the British Government following the pattern of the democratic system prevailing in their own country had patronised the evolution of a process of self government.
The Government of India Act of 1935 which was a positive improvement on the previous Acts had introduced provincial autonomy and the Indian Independence Act, 1947, adopted that pat tern of Government.
Even the Constitution which the people of India gave unto themselves in 1949 and which came into force from the 26th of January, 1950, followed that pattern, of course, with considerable modifications.
Thus when we became independent a democratic pattern had evolved in this country through more or less an historical process.
Soon the princely States disappeared by a process of merger and the Constitution ultimately came to have a federal base the federating States as the units and the federation at the Centre.
Democracy pre supposes certain conditions for its successful working.
It is necessary that there must be a deep sense of understanding, mutual confidence and tolerance and regard and acceptance 281 Of the views of others.
In the early years of freedom, the spirit of sacrifice and a sense of obligation to the leadership that had helped the dream of freedom to materialise had been accepted.
The emergence of a new generation within less than two decades of independence gave rise to a feeling that the people 's representatives in the Legislatures required the acquisition of the appropriate democratic bias and spirit.
ICPS was born as a voluntary organisation to fulfil this requirement.
At the inception it was certainly not a governmental organisation and it has not been the case of the parties in their pleadings nor have we been told at the bar during the long arguments that had been advanced that the objects of ICPS are those which are a State obligation to fulfil.
The Society was thus born out of a feeling that there should be a voluntary association mostly consisting of Members of the two Houses of Parliament with some external support to fulfil the objects which were adopted by the Society.
To Start with, the Society was accommodated in the Parliament House but in due course it shifted out.
The President of India inaugurated the Society.
Very appropriately the Speaker of the Lok Sabha became its first President and three Ministers, a former Chief Justice of India and a former Attorney General joined as its Vice Presidents.
Some of the public officers were also associated in the administrative set up of the Society.
Individual Members of Parliament and the corporate body known as Parliament are certainly two different concepts.
Services of some of the employees of Parliament were lent to the Society.
While Article 12 refers to Parliament as such, a few Members of Parliament cannot be considered as Parliament so as to constitute that body as referred to in Article 12.
The Speaker and the Ministers who joined as Vice Presidents of the Society were there in their individual capacities and not as Ministers, though designations were indicated.
In the category of Vice Presidents, Executive Chairman, Treasurer and members, there were many people who were really not a part of Government as such and some of them did not belong to Parliament.
The objects of the Society were not governmental business but were certainly the aspects which were expected to equip Members of Parliament and the State Legislatures with the requisite knowledge and experience for better functioning.
Many of the objects adopted by the Society were not confined to the two Houses of Parliament and were intended to have an impact on society at large.
The Memorandum of the Society permitted acceptance of gifts, 282 donations and subscriptions.
There is material to show that the Ford Foundation, a US based Trust had extended support for some time.
Undoubtedly, the annual contribution from the Government has been substantial and it would not be wrong to say that they perhaps constitute the main source of funding, Yet some money has been coming from other sources.
In later years, foreign funding came to be regulated and, therefore, it became necessary to provide that without Government clearance like any other institution, ICPS was not to receive foreign donations.
No material has been placed before us f the stand that the Society was not entitled to receive Contributions from any indigenous source without Government sanction.
Since Government money has been coming, the usual conditions attached to Government grants have been applied and enforced.
If the society 's affairs were really intended to be carrier on as a part of the Lok Sabha or Parliament as such, the manner of functioning would have been different.
The accounts of the Society are separately maintained and subject to audit in the same way as the affairs of societies receiving Government grants are to be audited.
Government usually impose certain conditions and restrictions when grants are made.
No exception has been made in respect of the Society and the mere fact that such restrictions are made is not a determinative aspect.
Considerable attempt has been made by Mr. Rao, learned counsel for the appellant, to show that in the functioning of the Society there is deep and pervasive control of government.
We have examined meticulously the correspondence and the instances where control was attempted to be exercised or has, as a fact, been exercised but these again are features which appear to have been explained away We were taken through the report submitted by the Tripathi Committee which had been set up to suggest changes in the set up and affairs of the Society.
The report and the steps taken on the basis of the report are also not material which can be taken to be indisputable features for reaching the conclusion one way or the other.
We were shown the correspondence by the Minister of Law with the Executive Chairman of the Society.
Undoubtedly the Minister has tried to exercise his authority as the controlling department of Government in the matter of making the grant.
As we have already pointed that itself may not be a conclusive feature.
We have several cases of societies registered under which have been treated as 'State ' but in each of 283 those cases it would appear on analysis that either governmental business had been undertaken by the Society or what was expected to be the public obligation of the 'State ' had been undertaken to be performed as a part of the Society 's function.
In a Welfare State, as has been pointed out on more than one occasion by this Court, Governmental control is very pervasive and in fact touches all aspects of social existence.
ln the absence of a fair application of the tests to be made, there is possibility of turning every non governmental society into an agency or instrumentality of the State.
That obviously would not serve the purpose and may be far from reality.
A broad picture of the matter has to be taken and a discerning mind has to be applied keeping the realities and human experiences in view so as to reach a reasonable conclusion.
Having given our anxious consideration to the facts of this case, we are not in a position to hold that ICPS is either an agency or instrumentality of the State so as to come within the purview of 'other authorities ' in Article 12 of the Constitution.
We must say that ICPS is a case of its type typical in many ways and the normal tests may perhaps not properly apply to test its character.
While we were referring to the cases in an earlier part of our judgment, we have noticed the caution indicated by this Court that even if some institution becomes 'State ' within the meaning of Article 12, its employees do not become holders of civil posts so as to become entitled to the cover of Article 311.
They would, however, be entitled to the benefits of Part III of the Constitution.
It is unnecessary to examine the appellant 's case keeping Articles 14 and 16 of the Constitution in view as on the concession of Dr. Anand Prakash the proceedings will have to reopen.
Before we part with this case, we must indicate what reliefs the appellant would be entitled to.
Now that the order of the dismissal is set aside and the proceedings have been restored to the stage of enquiry, the appellant shall be deemed to have been restored to service.
The appellant would have become entitled to the normal relief available in such a situation.
He should be deemed to be in service and we do not agree with Dr. Anand Prakash that his suspension should continue.
His suspension which had merged into dismissal has been vacated.
It shall, however, be open for the employer to make any direction as is deemed appropriate in that behalf in future.
The appellant, therefore, becomes entitled to the salary for the past period subject to his satisfying the authorities that he has not earned any other income during that period.
The appellant shall be given reasonable opportunity by the enquiring officer to meet the charges 284 and the enquiry shall be completed with in four months.
The appellant has personally assured us in Court that he will fully cooperate in the enquiry.
The enquiry officer shall allow inspection to the appellant of all records relevant to the enquiry.
We make no order as to costs.
S.L. Appeal disposed of.
[/INST]% The respondent was a Sarpanch of a Gram Panchayat.
Consequent upon a report made by the Sub Divisional officer, against the respondent stating the facts and circumstances which satisfied the conditions mentioned in section 115 of the orissa Gram Panchayat Act, 1964 for his suspension and removal, the second appellant, by his order dated 22.4.85, suspended the respondent.
A notice, as required by sub section (2) of section 151, was served on the Sarpanch who filed his detailed reply and was also personally heard.
As the explanation was not considered satisfactory, an order dated 24.10.86 removing him from the office of the Sarpanch was passed, in which it was mentioned that the appellant 's further continuance in office would be detrimental to the interest of the Gram Panchayat as also of the inhabitants of the Grama.
A second notification dated 24.10.86 under sub section (4) was also passed.
The Sarpanch challenged the above notifications before the High Court.
The High Court quashed the notifications on the sole and simple ground that the order did not satisfy one of the mandatory requirements, i.e. the appellant 's further continuance in the office would be detrimental to the interest of the Gram Panchayat or inhabitants of the Grama.
Allowing the appeal, ^ HELD: The language of sub section (2) does not require a repetition of the necessary satisfaction in the same language as referable to sub section (1).
Besides, the section cannot be interpreted to mandatorily lay down a rule for the authority concerned to express his conclusion in relation to the fulfilment of the conditions mentioned therein in a particular form using a particular set of words.
[181B] 178 What is contemplated by the section is the formation of an opinion in this regard after giving a reasonable opportunity to the Sarpanch in question to meet the allegations suggested and to announce the conclusion in unambiguous and express terms.
All that has been done in the instant case.
1 [181B C] The second appellant, while passing the order of suspension under sub section (l) of section 115, expressly stated that further continuance of the appellant in the office would be detrimental to the interest of the Gram Panchayat and the inhabitants of the Grama.
The State Government was of the opinion that the circumstances specified in sub section (1) existed.
In the order of removal, the State Government after mentioning the allegations, stated that the explanation of the Sarpanch was not acceptable and he was, therefore, being removed from the office.
The allegations made against him thus were accepted as correct.
The High Court was, therefore, not justified in quashing the impugned orders.[180 H; 181A,C]
</s>
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<s>[INST] Summarize the judgemention No. 1 of 1967.
Election Petition under Presidential and Vice Presidential Elections Act, 1952.
R.V.S. Mani, for the petitioners.
M.C. Setalvad, J.M. Mukhi and A.S. Nambiar, for respondent No. 1.
E. Udayaratnam, for respondent No. 6.
Janardan Sharma, for respondent NO. 10.
O.P. Varma, for respondent No. 12.
C.C. Patel and M.V. Goswami, for respondent No. 14.
Bhimsena Rao and R.A. Gupta, for respondent No. 17.
C.K. Daphtary, Attorney General, R.H. Dhebar and S.P. Nayar, for Election Petition of India and Returning Officer.
Presidential Election, New Delhi.
C.K. Daphtary, Attorney General, N.S. Bindra and R.H. Dhebar, for Attorney General for India.
The Judgment of the Court was delivered by Wanchoo, C.J.
The presidential election in India was held in May 1967.
In that election, 17 candidates were nominated.
The result of the election was declared on May 9, 1967, and Dr. Zakir Husain was declared elected.
The present petition is against 137 The election of Dr. Zakir Husain as President and has been filed under article 71 of the Constitution read with the Presidential and Vice Presidential Elections Act, No. 31, 1952 (hereinafter referred to as the Act) by 13 members of Parliament.
The attack on he validity of the election of Dr. Zakir Husain has been made on two grounds.
The first ground is that no oath was taken by Dr. zakir Husain before his nomination as required by article 84 read with article 58 of the Constitution.
In consequence he was not eligible for election as President and his election is liable to be set aside.
Curiously enough, however, the petitioners pray for a declaration that Sri Subba Rao, who received the second highest number of votes should be declared elected, though he (like Dr. Zakir Husain) also did not take the oath before his nomination.
The second ground on which the election of Dr. Zakir Husain s challenged is that the result of the election has been materially affected by reason of undue influence, thereat and in this connection reliance is placed on four matters to which reference will be made later.
The petition has been opposed on behalf of Dr. Zakir Husain.
It has been urged in reply that no oath was necessary under article 84 read with article 58 of the Constitution, and as such he was eligible to stand.
It has also been said on behalf of Dr. Zakir Husain that in case his nomination is invalid on that ground, Sri Subba Rao 's nomination is equally invalid as he also did not take the oath.
As to undue influence it is urged that no undue influence was exercised, nor was the result of the election materially affected by any exercise of undue influence.
Of the four matters urged in support of the attack on the ground of undue influence, the truth of one of them was not accepted.
But it is urged in the alternative that even accepting all that has been said by the petitioners in support of their case of undue influence, the allegations made by the petitioners do not in law amount to.
undue influence and therefore there could be no question of the result of the election being materially affected by the exercise of any undue influence.
On the pleading of the parties, the following issues were framed : 1.
Whether the acceptance of the nomination papers of respondents Nos. 1 to 17 by the Returning Officer was illegal and contrary to law for the reason that Respondents Nos. 1 to 17 did not subscribe to the oath required under Article 84(a) of the Constitution read with Article 58(1)(c) thereof; 2.
Whether the result of the election has been materially affected; L10Sup.(CI)/168 10 138 3.
Whether the acts and conduct alleged in para 12 of the petition and set out under heads A, B, C and D thereof amount to undue influence within the meaning of section 18(1)(b) of the Act.
Whether the allegations made under heads A, B, C and D in para 12 of the petition in so far as they are not admitted arc true; 5.
Whether the petition is entitled to any relief, and if so, to what relief.
It will be seen that issues Nos. 1 and 3 raise pure questions of law.
We made it clear to learned counsel that we would try this petition in two parts.
We shall first deal with the two issues of law, and then, if necessary, set the petition down for further hearing on evidence.
We also indicated that if issue No. 1 is decided in favour of the petitioners, the election would have to be set aside and then there would be no question of any further hearing on evidence.
We further indicated that if issue No. 3 is decided in favour of 1he petitioners, the petition would have to be set down for further hearing on evidence on matters of fact which were in dispute.
Lastly, we indicated that if both these issues were decided against the petitioners, the petition would fail and it would not be necessary then to set it down for further hearing on evidence.
We propose now to consider the two issues of law.
Issue No. 1.
In order to decide this issue, we have to see what the Constitution provided, before the Constitution (Sixteenth Amendment) Act, 1963 (hereinafter referred to as the Amendment Act).
This Act was passed on October 5.
Before that amendment article 58 (1) with which we are concerned in the present petition was in these terms : "(1) No person shall be eligible for election as President ', unless he (a) is a citizen of India, (b) has completed the age of thirty five years, and (c) is qualified for election as a member of the House of the People.
" Article 84, which is also relevant read thus "A person shall not be qualified to be chosen to fill a seat in Parliament unless he (a) is a citizen of India; (b) is, in/he case of d seat in the Council of States, not less than thirty years of age and, in the ease 139 of the House of the People, not less than twenty five years of age; (c) possesses such other qualifications as may be prescribed in that behalf by or under any law made by Parliament.
" The Representation of the People Act, No. 43 of 1951 provided some qualifications for membership of the House of the People, by section 4.
Besides that article 102 of the Constitution provided for certain disqualifications for membership of either House of Parliament and thus indirectly provided for qualifications necessary for being a member of either House of Parliament, and these were (1) that the person should not hold any office of profit under the Government of India or the Government of any State, other than an office declared by Parliament by law not to disqualify its holders; (2) the person should not be of unsound mind and should not have been so declared by a competent court; (3) the person should not be an undischarged insolvent; (4) the person should not have voluntarily acquired the citizenship of a foreign State, or be under any acknowledgement of allegiance or adherence to a foreign State; and (5) the person should not be disqualified by or trader any law made by Parliament.
A perusal of these provisions show that there was no requirement of taking an oath at the time of nomination by the presidential candidate in article 58.
Nor was there any requirement of taking any oath at the time of nomination by a candidate for election to the House of the People under article 84.
There were however provisions in the Constitution for taking an oath after election.
The oath of the President and its form was provided in article 60 while the oath for a member of the House of the People after 'election was provided in Schedule III to the Constitution.
which a member of Parliament had to take before taking his scat in the House of the People or the Council of States, as the case may be.
It is not disputed on behalf of the petitioners that this was the undoubted position in law before the Amendment Act.
Then came the Amendment Act, which came into force from October 5, 1963.
By that amendment, no change was made in article 58.
which stood as it was: a change was however made in Cl.
(a) of article 84, which after the Amendment Act read thus: "84.
Qualification for membership of Parliament A person shall not be qualified to be chosen to fill a seat in Parliament unless he (a) is a citizen of India, and makes and subscribes before some person authorised in that behalf by the Elec 140 tion Commission an oath or affirmation according to the form set out for the purposes in the Third Schedule;" The Third Schedule was also amended and provided the following form of oath to be taken by a member of Parliament who stands for election to Parliament, namely "I, A. B, having been nominated as a candidate to fill a seat in the Council of States do House of the People swear in the name of God that I will bear true solemnly affirm faith and allegiance to the Constitution of India as by law established and that I will uphold the sovereignty and integrity of India.
" At the same time amendment was made in the form of oath to be taken after election, the change being that the words "I will uphold the sovereignty and integrity of India" were added to the already existing oath to be taken by a member of Parliament after his election before he took his seat in the House of the People or the Council of States.
The contention on behalf of the petitioners is that because of this change in cl.
(a) of article 84 by which it became necessary to take.
oath for a person standing for election to either House of Parliament in the form prescribed in the Third SChedule, a person standing for election as President had also to take a similar oath because article 58(1)(c) requires that a person to be eligible for election as President must be qualified for election as a member of the House of the People.
It is urged that no one is qualified, after the amendment of cl.
(a) of article 84, for election as a member of the House of the People unless he makes and subscribes an oath in the form set out for the purpose in the Third Schedule, and therefore this provision applied to a person standing for election as President, for without such oath he would not be qualified to stand for election to the House of the People.
The argument looks attractive prima facie but must in our opinion be rejected.
The qualifications for eligibility to stand for election as President are to be found in article 58(1).
The main reliance on behalf of the petitioners is placed on cl.
(c) of article 58 (1), which lays down that a candidate standing for election as President has to be qualified for election as member of the House of the People.
A comparison however of article 58 with article 84 as it stood before amendment shows that el.
(a) of article corresponded to cl.
(a) of article 58(1), as both provided that the respective candidates should be citizens of India.
It was therefore not necessary to go to cI. (a) of article 84 for the purpose of finding out whether a person was eligible for election as President for 141 the purpose of citizenship for that part of cl.
(a) of article 84 was specifically provided for in cl.
(a) of article 58 (i).
Similarly, cl.
(b) of article 84 corresponded to cl.
(b) of article 58(1), with this difference that it provided a special qualification as to age and therefore one would not have to go to cl.
(b) of article 84 for the purpose of finding out the qualification as to age Cl.
(c) of article 38 (1) clearly corresponded to cl.
(c) of article 84 and reading them together it would follow that a person standing for election as President would require such qualifications as may be prescribed in that behalf by or under any law made by Parliament.
Further as cl.
(c) of article 58(1) lays down that a person standing for presidential election has to be qualified for membership of the House of the People, article 102 (which lays down disqualifications for members of Parliament) would also be attracted except in so far as there is a special provision contained in article 58(2).
Thus cl.
(c) of article 58(1) would bring in such qualifications for members of the House of the People as may be prescribed by law by Parliament, as required by article 84(c).
It will by its own force bring in article 102 of the Constitution, for that Article lays down certain disqualifications which a presidential candidate must not have for he has to be eligible for election as a member of the House of the People.
But it is clear to us that, what is provided in clause (a) and (b) of article 58(1) must be taken from there and we need not travel to cls.
(a) and (b) of article 84 in the matter of citizenship and of age of the presidential candidate.
Clauses (a) and (b) of article 58(1) having made a specific provision in that behalf in our opinion exclude cls.
(a) and (b) of article 84.
This exclusion was there before the Amendment Act and we are of opinion that there is nothing in the Amendment Act which makes.
any difference to that position.
The Sixteenth Amendment was introduced on the recommendation of the Committee on National Integration and Regionalism, which was greatly concerned over the preservation and maintenance of the integrity and sovereignty of the Union.
It therefore recommended that every candidate for the membership of a State legislature or Parliament, should pledge himself to uphold the Constitution and to preserve the integrity and sovereignty of the Union and for that forms of oath in the Third Schedule to the Constitution should be suitably amended.
It also recommended that every candidate for the membership of Parliament or State Legislature, Union and State Ministers, Members of Parliament and State Legislatures, Judges of the Supreme Court and High Court and the Comptroller and Auditor General of India should take oath to.
uphold the sovereignty and integrity of India.
In consequence of these recommendations, the sixteenth amendment was made and article 84 (a) as well as article 173 which provides for qualifications for membership of State legislature were suitably 142 amended.
Further two new forms were added in the Third Schedule, one relating to oath to be taken by candidates for elector to Parliament and the other relating to oath to be taken by candidates for election to State legislatures.
Further other forms of oath in the Third Schedule were also amended by adding therein the words "I will uphold the sovereignty and integrity of India.
" Now if the intention of Parliament was that an oath similar in form to the oath to be taken by persons standing for election 10 Parliament had to be taken by persons standing for election to the office of the President there is no reason why a similar amendment was not made in article 58(1)(a).
Further if the intention of Parliament was that a presidential candidate should also take an oath before standing for election, the form of oath should also have been prescribed either in the Third Schedule or by amendment of article 60, which provides for oath by a person elected as President before he takes his office.
But we find that no change was made either in article 58(1)(a) or in article 60 or in the Third Schedule prescribing the form of oath to be taken by the presidential candidate before he could stand for election.
This to our mind is the clearest indication that Parliament did not intend, when making the Amendment Act, that an oath similar to the oath taken by a candidate standing for election to Parliament had to be taken by a candidate standing for election to the office of the President.
So there is no reason to import the provision of article 84(a) as it stood after the Amendment Act into article 58(1)(a), which stood unamended.
That is one reason why we are of opinion that so far as the election to the office of the President is concerned, the candidate standing for the same has not to take any oath before becoming eligible for election as President.
Another reason which leads to the same conclusion is this.
We have already indicated that no change was made in article 60 by introducing the form of oath 'to be taken by a person standing for election as President; nor was there any change made m the Third Schedule by the introduction of a form of oath to be taken by a person standing for election as President.
In the absence of such a form, we fail to see how an oath would be necessary before a person could stand for election.
as President.
It is not as if a person standing for election as a member of Parliament can take any oath that he likes or that may be administered to him.
The particular oath which a person standing for election as a member of Parliament has to take has been prescribed in the Third Schedule to the Constitution, and it is only that oath which such a person has to take.
However no form of oath is prescribed for a person standing for election as President anywhere in the Constitution and in the absence of such form, it is impossible to hold that taking of oath before standing for election as President is a 143 necessary ingredient of eligibility for such election.
Further a comparison of the form of oath under article 60 for the President with form III B of the Third Schedule which prescribes the oath for a member of Parliament before he takes his seat shows that even after election the President is not required to swear that he will uphold the sovereignty and integrity of India.
The oath he takes is to preserve, protect and defend the Constitution and that he will devote himself to the service and well being of the people of India.
Clearly therefore the form of oath introduced by the sixteenth amendment for persons standing for election to Parliament and even after election was not considered suitable for a person standing for election as President or elected as President and that is why we find no form prescribed by Parliament.
It has been urged on behalf of the petitioners that, though no form of oath may be prescribed it was open to the Election Commission to prescribe an oath by making changes mutatis mutandis in form III A of the Third Schedule relating to candidates for election to Parliament, and that it was the duty of the Election Commission to appoint somebody to administer the oath in the form to be evolved by him by changing form III A in the Third Schedule mutatis mutandis.
Reliance in this connection has been placed on article 324 of the Constitution.
We are of opinion that there is no force in this contention.
Article 324 inter alia provides for "the superintendence, direction and control of the preparation of the electoral rolls for, and the conduct of, all elections to Parliament and to the Legislature of every State and of elections to the offices of President and Vice President".
These words do not in our opinion give any power to the Election Commission to introduce a form of oath to be taken by a candidate for election whether it be for election as President or as a member of Parliament or of a State legislature.
If an oath has to be taken by any.such person it has to be provided by law and the form thereof has also to be prescribed by law (we are using the word "law" in its broadest sense, including constitutional provisions) and that is what was done by the Sixteenth Amendment so far as election to Parliament and State legislatures was concerned.
But as already observed, Parliament did not think it fit when it brought in the Amendment Act to make any change in article 58 (1) (a) or to introduce a form in article 60 or in, the Third Schedule to the Constitution with reference to candidates standing for election as President.
If Parliament did not choose to do so, the Election,Commission cannot do so under the power it has been given under article 324 to superintendent, direct and control the preparation of the electoral rolls and the conduct of all elections.
That power is very different from the power to prescribe, an oath before a candidate can stand for election.
Such prescription can only be by law as indicated above.
The Amendment Act having not made any such provision with 144 respect to those standing for election to the office of the President, it cannot be open to the Election Commission to prescribe a form of oath for such persons by changing form III A mutatis mutandis.
Such power cannot be spelt out of article 324 on which reliance has been placed on behalf of the petitioners.
It follows therefore that no form whatsoever having been prescribed by Parliament when it made the sixteenth amendment for taking an oath by a presidential candidate, article 84 (a) when it prescribed for taking an oath for candidates for election to the.
House of the People has no application to candidates standing for election to Presidentship.
So far as these candidates are concerned we must look to article 58 (1) (a) only and need not go to article 84(a).
Another reason for coming to the same conclusion is that when article 58 (1) (c) lays down that a person standing for election as President has to be qualified for election as a member of the House of the People it only brings in qualifications other than those= which are specifically mentioned in article 58 (1) itself.
Now specific qualifications provided in article 58 (1) are that a candidate for presidential election has to be a citizen of India and he must have completed the age of 35 years.
So far as these qualifications are concerned, we need not go anywhere else in order to search for eligibility to contest election as President.
For example, the specific qualification in cl.
(b) of article 58.(1) is that the person concerned should have completed the age of 35 years.
On the other Hand, el.
(b) of article 84 lays down the age of 25 years for membership of the House of the People.
Therefore when one has to look for the qualification of age one must only go to article 58 (1) (b) for the purpose of presidential election and need not look elsewhere.
What is specifically provided for by article 58 (1) must be accepted as it stands and no addition can be made to that provision and no subtraction can be made therefrom.
It will be seen therefore that though there may be some qualifications which may be necessary for election to the House of the People, they need not necessarily apply to the election for the office of the President, where there is a specific provision in article 58 (1) itself.
We are therefore clearly of opinion that in view of the specific provision in article 58 (a) and (b) we cannot and should not apply clauses (a) and (b) of article 84, to persons standing for election as President.
This conclusion is reinforced if we look at article 58 (2) and compare it with article 102 (1) (a).
It is clear that when there is a specific provision with respect to an office of profit in article 58 (2); it is that provision which will apply and not article 102 (1) (a).
We therefore hold that the acceptance of the nomination papers of respondents 1 to 17 by the Returning Officer was neither illegal nor contrary to law on the ground that these respondents did not subscribe to an oath under article 84 (a) read with article 58(1)(c).
The issue is decided against the petitioners.
145 ISSUE No. 3.
The petitioners rely on four allegations on the question of undue influence.
Before we deal with those allegations it is necessary to understand what undue influence is in the context of the Act.
Section 18 (1 ) (b) lays down that if the result of the election has been materially affected by reason of undue influence at the election committed by any person other than the returned candidate or a person acting in connivance with the returned candidate, the election will be liable to be declared void.
Sub section (2) of section 18 lays down that undue influence would have the same meaning as in Chapter IX A of the Indian Penal Code.
Section 171 C of the Indian Penal Code defines what "undue influence" is in these terms : "(1) Whoever voluntarily interferes or attempts to interfere with the free exercise of any electoral right commits the offence of undue influence at an election.
(2) Without prejudice to the generality of the provisions of sub section (1), whoever (a) threatens any candidate or voter, or any person in whom a candidate or voter is interested, with injury of any kind, or (b) induces or attempts to induce a candidate or voter to believe that he or any person in whom he is interested will become or will be rendered an object of Divine displeasure or of spiritual censure, shall be deemed to interfere with the free exercise of the electoral right of such candidate or voter, within the meaning of sub section (1).
(3) A declaration of public policy or a promise of public action, or the mere exercise of a legal right without intent to interfere with an electoral right, shall not be deemed to be interference within the meaning of this section.
" It will be seen from the above definition that the gist of undue influence at an election consists in voluntary interference or attempt at interference with the free exercise of any electoral right.
Any voluntary action which interferes with or attempts to interfere with such free exercise of electoral right would amount to undue influence.
But even though the definition in sub section
(1) of section 171 C is wide in terms it cannot take in mere canvassing in favour of a candidate at an election.
If that were so, it would be impossible to run democratic elections.
Further sub section
(2)ors.
171 C shows what the nature of undue influence is though of course it does not cut down the generality of the provisions contained in sub section (1).
Where any threat is.
held out to any candidate or voter or any person in whom a candidate or voter is interested and 146 the threat is of injury of any kind, that would amount to voluntary interference or attempt at interference with the free exercise of electoral right and would be undue influence.
Again where a person induces or attempts to induce a candidate, or voter to believe that he or any person in whom he is interested will become or will be rendered an object of Divine displeasure or of spiritual censure, that would also amount to voluntary interference with the free exercise of the electoral right and would be undue influence.
What is contained in sub section
(2) of section 1771 C is merely illustrative.
It is difficult to lay down in general terms where mere canvassing ends and interference or attempt at interference with the free exercise of any electoral right begins.
That is a matter to be determined in each case; but there can be No. doubt that if what is done is merely canvassing: it would not be undue influence.
As sub section (3) of section 171 C shows, the mere exercise of a legal right without intent to interfere with an electoral right would not be undue influence.
We may in this connection refer to section 123(2) of the Representation of the People Act 1951 which also defines "undue influence".
The definition there is more or less in the same language as in section 171 C of the Indian Penal Code except that the words "direct or indirect" have been added to indicate the nature of interference.
It will be seen that if anything, the definition of "undue influence" in the Representation of the People Act may be wider.
It will therefore be useful to refer to cases under the election law to see how election tribunals have looked at the matter while considering the scope of the words "undue influence".
The earliest case to which reference may be made is R.B. Surendra Narayan Sinha vs Amulyadhone Roy & 43 Others.(1) There the question raised before the Election Tribunal was whether by issuing a whip on the day of election requesting members to cast their preferences in a particular order, the leader of a Party, who was also the Chief Minister, could be said to have exercised undue influence.
The Election Tribunal held that the leader the party was entitled to use his influence as a leader and he could not be deprived of that right because he happened to.
be a minister.
The issue of a whip of that kind was thus held to be no more than canvassing in.
favour of the candidates of the party to which the leader or the Chief Minister belonged.
In Linge Gowda vs Shivananjappa(2), the Election Tribunal held that a leader of a political party was entitled to declare to the public the policy of the party and ask the electorate to vote for his party without interfering with any electoral right and such declarations on his part would not amount to undue influence under (1) 1940 Indian Election Cases by Sen and Poddar, Case No. XXX at p. 188.
(2) (1953) VI E.L.R. 288.
147 the Representation of the People Act.
The fact of that such a leader happened to be a Minister or Chief Minister of the State would make no difference.
It was further observed in that case that "the law cannot strike at the root of due influence and under the law of election, only undue influence is forbidden, and the leaders of ' a party will be deemed to exercise their due influence if they ask the electorate to vote for their party candidate, even if they happen to be Ministers." In Amirchand vs Surendra Lal Jha(1) it was held by the Election Tribunal that Ministers were prominent members.
of their party and in that capacity they were entitled to address meetings and to tell people what their party had done, and what its programme was and to ask them to vote for the candidate set up by their party, and such action of the Ministers could not be held amount to exercising undue influence.
It merely amounted to canvassing by the Ministers in favour of candidates belonging to their party.
In Mast Ram vs
section Iqbal Singh(2) it was held by the Election Tribunal that the legitimate exercise of influence by a political party or an association should not be confused with "undUe influence".
It was further held that "Ministers in their capacity as members of their party are entitled to address meetings and to tell people what their party had done and what its.
programme was and to ask them to vote for the candidate set up by their party.
Such action of the Ministers cannot be held to amount to 'exercising undue influence ' ".
It was further held ' that "if ' a political ' party passes a resolution of support to a candidate and asks its members to vote for him, it will be only a legitimate exercise of influence".
In Radhakrishna Shukla vs Tara Chand Maheshwar.(3) the Election Tribunal held that even where Ministers conducting an electioneering campaign promised people, who put their grievances before them during the campaign, generally to redress their grievances, it could not be held that there was exercise of undue influence and their promise merely amounted to a promise of public action, which would not be for the benefit of merely those who voted for candidates of their party but for the public as a whole.
The next case to which reference may be made is N. Sankara Reddi vs Yashoda Reddi(4).
In that case the Election Tribunal held that "a political party is entitled to issue a manifesto to the ' voters requesting them to vote only for the candidate, set up by the party.
The fact that the leader of the Congress Legislature Party who was also the Chief Minister of the State had written (1)(1954) X E L R 57.
(2) (1955) XII E.L.R.34 (3)(1956) XII E.L.R. 378.
(4) (1957) XIII E.L.R. 34.
148 letters to the members of the Congress Party to support the candidates set up by the party would not amount to undue influence within section 123(2) of the Representation of the People Act.
" It was added that it was only where a Minister abused his position for furthering the prospects of the candidate belonging to his party that undue influence might arise; but where a leader merely used his influence in the form of canvassing for candidates of his party there would be no question of undue influence.
In Dr. Y.S. Parmar vs Hira Singh Pal(1), the Judicial Commissioner of Himachal Pradesh held that "a leader of a political party is entitled to.
declare to the public the policy of the party, and ask the electorate to vote for his party without interfering with any electoral right and such declarations on his part would not amount to undue influence under section 123(2) of the Representation.
of the People Act.
" In Triloki Singh vs Shivrajwati Nehru(2) it was held by the Election Tribunal that "the right to canvass must be conceded to Ministers as leaders of a political party Just as they have a right to vote and to stand as a candidate, they also have a right to canvass for themselves and for the other candidates set up by their party.
" It was further held that though a Minister occupied a high position and commanded great influence, if he only solicited votes and tried to persuade the electors to vote for a candidate of his party and asked them not to vote for any other candidate or to remain neutral and did nothing more, he could not be said to interfere with the free exercise of the electoral right of the voters.
The last case to which reference may be made is Jayalakshmi Devamma vs Janardhan Reddi(3).
In that case the Andhra Pradesh High Court held that in a democratic set up where candidates contested elections on the basis of their affiliation to a particular political party, there was nothing intrinsically wrong in Ministers canvassing support for their party candidates.
It was further held that a Minister merely by reason of his office did not suffer from any disability in this behalf and had the same rights and obligations as any other citizen in the matter of canvassing.
It was also held that in their capacity as leaders of their party.
they had to explain to the electors the policies and programmes which they sought to enforce and one way of doing that was to ask the electors to vote for those who were pledged to support them and their policies.
It will be seen from the above review of the cases relating to undue influence that it has been consistently held in this country that it is open to Ministers to canvass for candidates of their party (1) (1958) 16 E.L.R.4 (2) (1958) XVI.E.L.R 234.
(3) (1959) XVII E.L.R. 302. 149 standing for election.
Such canvassing does not amount to undue influence but is proper use of the Minister 's right to ask the public to support candidates belonging to the Minister 's party.
It is only where a Minister abuses.
his position as such and goes beyond merely asking for support for candidates belonging to his party that a question of undue influence may arise.
But so long as the Minister only asks the electors to vote for a particular candidate belonging to his party and puts forward before the public the merits of his candidate it cannot be said that by merely making such request to the electorate the Minister.
exercises undue influence.
The fact that the Minister 's request was addressed in the form of what *is called a whip, is also.
immaterial so long as it is clear that there ' is no compulsion on the electorate to vote in the manner indicated.
It is in the light of these principles that we have to see whether the four allegations made in this case, assuming them to be correct, make out a case of undue influence.
The first allegation is that Shrimati Indira Gandhi, the Prime Minister, addressed a letter to all the electors in which she commended Dr. Zakir Husain and requested the electors to vote for him.
A copy of that letter has been produced, and we have been taken through it.
In our opinion there is nothing in that letter which may even remotely amount to undue influence.
Most of the letter is concerned with commending the qualities of Dr. Zakir Husain and it ends by saying that Dr, Zakir Husain 's long and meritorious service in the cause of national freedom and national re construction after Independence makes him a candidate richly deserving universal support.
It has been urged that the Prime Minister is a person of great influence and therefore Shrimati Indira Gandhi should not have written this letter because she was Prime Minister and the mere fact that she wrote this letter commending Dr. Zakir Husain 's election amounted to undue influence i.e. interference with the free exercise of the electoral right.
We can not agree with this contention.
Shrimati Indira Gandhi is certainly the Prime Minister, but she is also one of the leaders of the party to which Dr. Zakir Husain belonged.
As a leader of party she was entitled to ask the electors to vote for Dr. Zakir Husain and the fact that she is the Prime Minister makes no difference to her right to make an appeal of this nature.
It is said that the office of the President is a no party office and therefore an appeal of this nature should not have been made and must amount to undue influence.
It is true that the office of the President is not a party office meaning thereby that after his election the President is no longer a party man.
But that cannot take away the fact that in a democratic system, like ours, persons who stand for election are candidates sponsored by parties for without such support no one would have a chance of being elected, for the.
electors are mostly members of one party or other.
We have given 150 our earnest consideration to the letter written by Shrimati Indira Gandhi and have come to the conclusion that there is nothing in that letter which can be said to be improper or which can even remotely amount to interference with the free exercise of the electoral rights.
It cannot therefore be said that Shrimati Indira Gandhi even though she is the Prime Minister exercised any undue influence in this presidential election.
The next allegation is based on two letters written by Sri Ram Subhag Singh.
In these letters.
Sri Ram Subhag Singh signed himself as Chief Whip and they were addressed to all members of the Congress Party in Parliament.
The fact that he signed the letters as Chief Whip is in our opinion of no consequence; even if he had not done so all members of the congress party in Parliament must be knowing that he was the Chief Whip.
Just as a Minister has a right to canvass for support so has in our opinion the Chief Whip.
In the first letter he pointed out that the Presidential and Vice Presidential elections were to be held on May. 6, 1967.
He also pointed out that members of Parliament could vote for the presidential election at New Delhi or at State capitals but they had to come to Delhi in connection with the election of the Vice President.
He therefore added that as the two elections were to be held on the same day and voting for the Vice Presidential election could only be at Delhi, every member of the party must be present in Delhi to participate in the elections.
He finally requested the members of his party to reach New Delhi by May 4, 1967 and contact him on reaching.
New Delhi.
This letter merely explains to members of his party the situation with respect to the two elections which were to be held simultaneously and requested the members to come to Delhi, as otherwise they could not vote in the Vice Presidential election.
The fact that he asked the members to contact him after reaching Delhi could only be to know who had come and who had not and cannot give rise inference of undue influence from that fact alone.
In the second letter, Sri Ram Subhag Singh pointed out that the election to the office of the President would be in accordance with the system of proportional representation by means of single transferable vote.
He also invited the attention of the members of the Congress Party in Parliament to r. 19 of the Election Rules.
He then went on to say that it was their desire, i.e., of the congress party, that Dr. Zakir Husain should be returned with a thumping majority.
He therefore requested the members to place figure '1 ' opposite the name of Dr. Zakir Husain.
He also advised them not to mark the second or any other preference in favour of any other candidate.
As we read this letter we only find in it a request to members of the party to vote for Dr. Zakir Husain There is nothing in that letter to show that undue influence was being exercised thereby.
The two letters read together merely show 151 that Sri Ram Subhag Singh who happened to be the Chief Whip of the congress party was canvassing in favour of Dr. Zakir Husain.
It is however urged that his advice to the members not to mark their second or any other preference in favour of any other candidate amounted to interference with the free exercise of their electoral right.
We cannot agree with this contention.
Sri Ram Subhag Singh asked the members of his party to give the first preference to Dr. Zakir Husain.
He also asked them not to mark their second or any other preference, and that is a method to ensure that the candidate to whom the first preference is given should be in a strong position in case there is not a majority in the first counting.
In the present election there was apparently a majority in the first counting and therefore the marking of the second or any other preference was immaterial.
Apart from it.
we see nothing improper in members of the party being told in the course of canvassing that it would be better if they only marked their first preference and no other preference in a system where voting is by single transferable vote.
Such a request or advice does not in our opinion interfere with the free exercise of their electoral right for the electors still would be free to do what they desired in spite of the advice.
We cannot agree.
after going through the two letters written by Sri Ram Subhag Singh that there was any interference with the exercise of the electoral right by the electors.
The third allegation is that the Prime Minister had deputed certain senior members of her cabinet to the various States to make doubly certain that Dr. Zakir Husain was elected.
In consequence, Shri Fakhruddin Ali Ahmed was sent to Assam, Shri Y. B. Chavan to Bombay, Sri Jagjivan Ram to Bihar, Sri I.K. Gujral to Calcutta and Sri Dinesh Singh to Uttar Pradesh.
It is further urged that sending of the Ministers to various States was to influence the members of the electoral college there to vote for Dr. Zakir Husain or attempt to do so.
Such action it is urged.
would amount to undue influence.
We cannot agree with this contention.
Assuming that these Ministers were asked to go to various States it was obviously to canvass support for Dr. Zakir Husain so that he may be certain to be elected.
Even assuming that these Ministers canvassed support for Dr. Zakir Husain in various State capitals, their action cannot be said to amount to undue influence, for all that they can be said to have done was to canvass support for Dr. Zakir Husain and mere canvassing cannot possibly be; held to be undue influence.
There is nothing 'in the allegation in para 12 C of the petition to show that there was any interference with the free exercise of electoral right by the electors.
even if these Ministers were sent to.
the various State capitals to canvass support for Dr. Zakir Husain ,red did so.
Mere canvassing of support for a candidate can never amount to undue 152 influence, and all that para 12C shows is that there was mere.
canvassing in favour of Dr. Zakir Husain.
No case of undue influence can be made out on the basis of the allegations contained in para 12C of the petition.
The last allegation in support of the case of undue influence is that the Chief Minister of Maharashtra had briefed members of the Legislative Assembly on May 5, 1967 on how to vote and whom to vote for.
It is, urged that even if the leader of the party in the Maharashtra legislature could indicate the manner of voting the members of his party, he could not indicate to them whom they were to vote for, as that interfered with the free exercise of their electoral right.
It is said that such a request amounted to a command from a person in authority, like the Chief Minister, and would be exercise of undue influence.
We are of opinion that there is no substance in this contention either.
There can possibly be no objection if the leader of the party indicates to the members of his party how to vote in order to ensure that votes may not become invalid for want of knowledge of the procedure of voting.
Further if the leader of the party indicates to members of his party for whom to vote he is merely canvassing with his own party men to support the candidate of the party.
The mere fact that the person who, canvasses is a Chief Minister does not mean that he is exercising undue influence in the sense of interfering with the free exercise of the electoral right.
Once canvassing is permissible, and we have no doubt that in a democratic set up where ' parties put up candidates for election it is not only permissible but necessary, it follows that if a leader of the party asks members of his party for whom.
to vote he is merely canvassing.
The voting is after all secret and every elector is free to vote for whomsoever he likes, even though he may have been asked by the leader to vote for a particular candidate.
There is nothing in para 12 (D) of the petition to suggest that anything improper was.
done by the Chief Minister of Maharashtra, which could give rise to an inference that t.he free exercise of the electoral right was being interfered with.
On a careful consideration of paragraphs 12(A) to 12(D) of the petition we have come to the conclusion that there is nothing in those paragraphs which even remotely suggests that there was any undue influence exercised by anybody in connection with the Presidential election of May 6, 1967.
Our finding on the issue in question is that the acts.
and conduct alleged in paragraph 12 of the petition and set out in sub paras A to D thereof do not amount to undue influence within the meaning of section 18(1 )(b) of the Act.
The issue is decided against the petitioners.
As we have indicated already if both these issues of law are decided against the petitioners as we do decide them the petition 153 must fail and it is unnecessary to set it down for hearing on evidence with respect to other issues.
The petition is hereby dismissed but in the circumstances of the case we pass no order as to costs.
Y.P. Petition dismissed.
[/INST]As a result of the Presidential election held in May, 1967, respondent No. 1 was declared elected.
The petitioners challenged the election on the following two grounds, namely (i) article 58(1)(c) required that a person to be eligible for election as President must be qualified for election as a member of the House of People.
After the Sixteenth Amendment, under article 84(a), it was necessary for a person standing for election to either House of Parliament to take an oath in the form prescribed in the Third Schedule.
Therefore, a person standing for election as President had also to take a similar oath; since the respondent had not taken the oath he was not eligible for election.
(ii) As (a) the Prime Minister addressed a letter to all electors commending respondent No. 1 and requesting them to vote for him; '(b) the, Prime.
Minister deputed Ministers 1 various State Capitals to make doubly certain that respondent No. 1 was elected; (c) a Minister who was also the chief whip of the Congress party wrote two letters to all members of his party in Parliament and signed them as Chief Whip, explaining the situation with respect to the election and requesting them to come to Delhi and contact him and also requesting them to give the first preference to respondent No. 1 and not to mark the second or any other preference in favour of the candidates; and (d) the Chief Minister of Maharashtra had briefed members of the Legislative Assembly as to how and for whom to vote, the result of the election has materially been affected by undue influence.
HELD: The petition must be dismissed.
(i) The candidate standing for election to the office of the President had not to take any oath before becoming eligible for election as President.
A comparison of article 58 with article 84 as it stood before the amendment shows that el.
(a) of article 84, corresponded to el.
(a) of article 58(1), as both provided that the respective candidates should be citizens of India.
It was therefore, not necessary to go to cl.
(a) of article 84 for the purpose of finding out whether a person woks eligible for election as President for the purpose of citizenship for that part of el.
(a) of article 84 was specifically provided for in el.
(a) of article 58(1).
Similarly, el.
(b) of article 84 corresponded to el.
(b) of article 58(1).
with this difference that it provided a special qualification as to age and therefore 134 one would not have to go to cl.
(b) of article 84 for the purpose of finding out the qualification as to age.
Clause (c) of article 58(1) clearly corresponded to el.
(c) of article 84 and reading them together it would follow that a person standing for election as President would require such qualifications as may be prescribed in that behalf by or under any law made by Parliament.
Further as el.
(c) of article 58(1) lays down that a person standing for Presidential election has to be qualified for membership of the House of the People, article 102 (which lays down disqualifications for members of Parliament) would also be attracted except in so far as there is a special provision contained in article 58(2), Thus cI. (c) or article 58(1) would bring in such qualifications for members of the House of the People as may as prescribed by law by Parliament, as required by article 84(c).
It will by its own force bring in article 102 of the Constitution, for that Article lays down certain disqualifications which a presidential candidate must not have for he has to be eligible for election as a member of the House of the People.
But it clear that what is provided in cl.
(a) and (b) of article 58(1) must be taken from there and it is not necessary travel to cls.
(a) and (b) of article 84 in the matter of citizenship and of age of the presidential candidate.
Clauses (a)and (b) of article 58(1) having made a specific provision in that behalf exclude cls.
(a) and (b) of article 84.
There is nothing in the Amendment Act which makes any difference to that position, for.
if the intention of Parliament was that an oath similar in form to the oath for membership of Parliament had to be taken by persons standing for election to the office of the President there is no reason why a similar amendment was not made in article 58(1) (a) and why the form: of oath not also prescribed either in the Third Schedule or by amendment of article 60.
which provides for oath by a person elected as President before he takes his office.
[140H 141E; 142B C] The particular oath which a person standing for election as a member of Parliament has to take has been prescribed in the Third Schedule to the Constitution, and it is only that oath which such a person has to take.
However, no form of oath is prescribed for a person standing for election as President anywhere in the Constitution and in the absence of such form.
it is impossible to hold that taking of oath before standing for election as President is a necessary ingredient of eligibility for such election.
The Amendment Act having not made any such provision with respect to those standing for election to the office of the President, it cannot be open to the Election Commission to prescribe a form of oath for such persons by changing form III A mutatis mutandis.
Such power cannot be spelt out of article 324 under which the Election Commission is conferred power to superintend direct, and control the preparation of the Electoral Rolls and the conduct of elections.
[143G 144B] Further.
a comparison of the form of oath under article 60 for the President with form III B of the Third Schedule which prescribes the oath for a member of Parliament before he takes his seat.
shows that even after election the President is not required to swear that he will uphold the sovereignty and integrity of India.
The oath he takes is to preserve.
protect and! defend the Constitution and that he will devote himself to the service and well being of the people of India.
the form of oath introduced by the sixteenth amendment for persons standing for election to Parliament and even after election was not considered suitable for a person standing for election as President or elected as President and that is why no form is prescribed by Parliament.
[143A C] (ii) Any voluntary action which interferes with or attempts to interfere with the free exercise of electoral right would amount to undue 135 influence.
It cannot take in mere canvassing in favour of a candidate at an election.
If that were so, it would be impossible to run democratic elections.
It is difficult to lay down in general terms where mere canvassing ends and interference or attempt at interference to with the tree exercise of any electoral right begins.
That is a matter to be determined in each case; but there can be no doubt that if what is done is merely canvassing it would not be undue influence.
[145G 146C] (a) There was nothing in the fetter of the Prime Minister which even remotely amounted to undue influence.
As a leader of the party she was entitled to ask the electors to vote for respondent No. 1 and the fact that she is the Prime Minister makes no difference to her right make an appeal of this nature.
It is.
said that the office of the President is a no party office and therefore an appeal of this nature should not have been made and must amount to undue influence.
It is true that the office of the President is not a party office meaning thereby that after his election the President is no longer a party man.
But that cannot take away the fact that in a democratic system, persons who stand for election are candidates sponsored by parties for without such support no fine would have a chance of being elected.
for the electors are mostly members of one party or other.
[149G 1SOB] (b) Mere canvassing of support for a candidate can never amount to undue influence.
There was no interference with the free exercise of electoral right by the electors, even if the Ministers were sent to the various Sate capitals to canvass support for respondent, No 1.
[148H] (c) The fact that the Minister signed the letters as Chief Whip was of no consequence; even if he had not done so all members of the Congress party in Parliament must be knowing that he was the Chief Whip.
Just as a Minister has a right to canvass for support, so has the Chief Whip.
The fact that he asked the members to contact him after reaching Delhi could only be to know who had come and who had not and could not give rise to any inference of undue influence from the fact alone.
There was nothing in the second letter also to show that undue influence was being exercised thereby.
The two letters read together merely show that the Chief Whip of the Congress party was canvassing in favour of respondent No. 1.
There was nothing improper in members of the party being told in the course of canvassing that it would be better if they only marked their first preference and no other preference in a system where voting is by single transferable vote.
Such a request of advice does not interfere with the free exercise of their electoral for the electors still would be free to do what they desired inspite of the advice.
[150B 151D] (d) There can be no objection if the leader of the party indicates to the members of his party how to vote in order to ensure that votes may not become invalid for, want of knowledge of the procedure of voting.
Further if the leader of the party indicates to members of his party for whom to vote he is merely canvassing with his own party men to support the candidate of the party.
The mere fact that the person who canvasses is a Chief Minister does not mean that he is exercising undue influence in the sense of interfering with the free exercise of the electoral right.
Once canvassing is permissible, and in a democratic set up where parties put up candidates for election it is not only permissible but necessary.
it follows that if a leader of the party asks members of his party for whom to vote he is merely canvassing.
The voting is after all secret and every elector is free to vote for whomsoever he likes, even though he may have been asked by the leader to vote for a particular candidate.
[152C F] 136 It is open to Ministers to canvass for candidates of their party standing for election.
Such canvassing does not amount to undue influence but is proper use of the Minister 's right to ask the public to support candidates belonging to the Minister 's party.
It is only where a Minister abuses his position as such and goes beyond merely asking for support for candidates belonging to his party that a question of undue influence may arise.
But so long as the Minister only asks the electors to vote for a particular candidate belonging to his party and puts forward before the public the merit of his candidate it cannot be said that by merely making such request to the electorate the Minister exercises undue influence.
The fact that the Minister 's request was addressed in the form of what it called a whip is also immaterial so long as it is clear that there is no compulsion on the electorate to vote in the manner indicated [ 149A C] R.B. Surendra Narayan Sinha vs Amulyadhone Ray & 43 Ors. 1940 Indian Election Cases by Sen and Poddar, Case No. XXX at p. 188.
Linge Gowda vs Shivananjappa.
(1953) VI E.L.R. 288, Amirchand vs Surendra Lal Jha, (1954) X E.L.R. 57, Mast Ram vs
section lqbal Singh, (1955) XII E.L.R. 34, Radhakrishna Shukla vs Tara Chand Maheshwar, (1956) XII E.L.R. 378, N. Sankara Reddi vs Yashoda Reddi (1957) XIII E.L.R. 34, Dr. Y.S. Parmar vs Hira Singh Pal.
(1958) XVI E.L.R. 45.
Triloki Singh vs Shtvrajwati Nehru, (1958) XVI E.L.R. 234 and Jayalakshmi Devamma vs Janardhan Reddi, (1959) XVII E.L.R. 302, referred to
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<s>[INST] Summarize the judgementAppeal No. 263 of 1956.
Appeal from the judgment and decree dated January 6, 1953, of the Madras High Court in A. section Appeal No. 7 of 1949.
M. C. Setalvad, Attorney General of India and Naunit Lal, for the appellants.
100 780 A. V. Vimanatha Sastri and B. K. B.Naidu, for respondent No. 1.
M. B. K. Pillai, for respondent No. 2. 1961.
February 9.
The Judgment of the Court was delivered by GAJENDRAGADKAR,J.
This appeal has been brought to this Court with a certificate granted by the Madras High Court and it arises from a suit filed by the appellants Mallesappa and Chenna Basappa against their uncle Mallappa, respondent 1 and granduncle Honnappa, respondent 2, for partition.
According to the plaint, the family of the appellants and respondent 1 was an undivided Hindu family until the date of the suit, and respondent 1 was its manager.
The ancestor of the family was Desai Mallappa.
He had three sons, Kari Ramappa who died in 1933, Virupakshappa who died long ago and Honnappa, respondent 2.
Kari Ramappa had four sons Guru shantappa (died 1913), Bandappa (died 1931), Mallappa (respondent 1) and Veerabhadrappa (died 1927).
Gurushantappa married Parvathamma; the two appellants are the sons of Bandappa, their mother being Neelamma.
They were born in 1926 and 1929 respectively.
Their case was that respondent 1 who has been the manager of the family for many years has been trying to deprive them of their legitimate share in the property and refused their request for partition, and so they had to file the present suit.
According to them, in the property of the family they and respondent 1 were entitled to half share each.
To the plaint were attached the schedules describing the several items of property.
Schedule A consisted of items 1 to 163 which included houses and lands at Jonnagiri.
Schedule B described the movables while Schedule C included items 1 to 35 all of which had been acquired by the family under a document exhibit B 32.
It is in respect of all these properties that the appellants claimed their half share and asked for a partition in that behalf.
This claim was resisted by respondent 1 principally on the ground that in 1929 Ramappa, the father of 781 respondent 1 and the grandfather of the appellants had effected a partition of the joint family properties between respondent 1 and his elder brother Bandappa who is the appellants ' father.
That is how, according to respondent 1, the appellants ' claim for partition was untenable.
In this way he pleaded separate title to all the properties in suit.
On these pleadings the learned District Judge, who tried the suit, framed eight issues; two of these related to the question regarding the status of the family.
He found that the plea of partition made by respondent 1 was not proved, and accordingly he declared that the appellants were entitled to half share in the properties of the family and passed a preliminary decree for partition.
According to the learned judge, the appellants were entitled to their half share in the items of property described in Schedule A excluding items 63, 64, 65, 86 and 151 and items in paragraph 14(d) of the written statement of respondent 1 as well as items of property described in Schedules B and C.
This decree was passed on November 22, 1948.
The said decree was challenged by respondent 1 by his appeal before the Madras High Court.
He urged that the trial court 's finding as to the status of the family was erroneous, and he pleaded that in any case the appellants were not entitled to any share in the properties at Jonnagiri, items 4 to 61, as well as the properties acquired under exhibit B 32.
The first argument was rejected by the High Court, but the second was upheld.
In the result the decree passed by the trial court was confirmed except in regard to the said two categories of properties.
It is this appellate decree which is challenged before us by the learned Attorney General on behalf of the appellants.
In order to appreciate the contentions raised before us it would be necessary to recapitulate briefly the findings concurrently recorded by the courts below in respect of the plea of partition set up by respondent 1.
These findings afford a background in the light of which the pleas raised before us would have to be considered.
It appears that respondent 1 relied on several documents in support of his plea that there 782 was a partition effected by Ramappa in 1929.
The trial court repelled this argument and observed that from 1937 respondent began to do mischief.
The transfer of patta in 1937 on which respondent 1 relied was entirely his work and the appellants ' mother Neelamma had not been consulted and had given no consent to it.
In the opinion of the trial court respondent 1 through his agents whom he examined as witnesses in the suit (D. Ws. 2 and 14) managed the family lands, arranged to pay cist for them and manipulated entries in the revenue record purporting to show that Neelamma had paid the said cist as pattadar.
Neelamma was an illiterate and Gosha woman and it appeared that a certain amount of coercion had been practised on her as well as deception in persuading her to execute the original of exhibit B 10 which contained the recital that the house there described had fallen to the share of Neelamma 's husband at a prior partition.
The trial court was satisfied that the said recital had been fraudulently made and the 'document had not been read to Neelamma at all.
The demeanour of respondent 1 in the witness box was also criticised by the trial judge when he observed that he did not impress the trial judge as a truthful witness, and in his opinion he was a powerful and influential man in the village who was able to do a number of things as he wished and so it was not surprising that he was able to get a number of witnesses to speak to separate enjoyment of a few items of land by the appellants ' mother.
When the question of status of the family was reagitated before the High Court it felt no hesitation in confirming the conclusions of the trial court in regard to the general conduct of respondent 1, the documents brought into existence by him, and the unfair manner in which he had dealt with the appellants ' mother.
For the reasons set out by the High Court in its judgment " and also for the various reasons put forward by the learned District Judge in his exhaustive judgment " the High Court agreed with the learned judge that the alleged partition of 1929 had not been proved.
Thus the dispute between the parties has to be considered 783 on the basis that until the date of the institution of the suit the family was an undivided Hindu family with respondent I as its manager.
The first point which has been raised before us by the learned Attorney General relates to items 4 to 61 at Jonnagiri.
These properties originally belonged to Karnam Channappa.
He died in 1904, and in due ' course the said property devolved upon his widow Bassamma who died in 1920.
Bassamma left behind her three daughters Channamma, Nagamma and Veeramma.
Channamma married Ramappa, and as we have already indicated the couple had four sons including the appellants father Bandappa and the first respondent Mallappa.
It is common ground that the properties at Jonnagiri had been obtained by Channamma by succession from her father and were held by her as a limited owner.
The appellants ' case was that after Channamma obtained these properties by ,succession she allowed the said properties to be thrown into the common stock of other properties belonging to her husband 's family, and so by virtue of blending her properties acquired the character of the properties belonging to her husband 's family; in other words, the appellants ' claim in respect of this property is based on the principle of blending or throwing into the com mon stock which is recognised by Hindu law.
The trial court relied on some transactions adduced by the appellants and upheld the plea that Channamma 's properties had become joint family properties in which the appellants had a half share.
The High Court has reversed this finding, and it has held that the transactions on which the appellants relied do not prove blending as known to Hindu law.
That is why the appellants ' claim to these properties has been rejected by the High Court.
Before considering the appellants ' case in regard to ,/these properties it is necessary to enquire whether the doctrine of blending can be invoked in such a case.
Is this doctrine based on any Sanskrit Text of Hindu Law? According to the decision of the Privy Council in Shiba Prasad Singh vs Rani Prayag Kumari Debi (1).
(1) (1932) L.R. 59 I.A. 331. 784 this doctrine is based on the text of Yagnavalkya and the commentary of Mitakshara; the text of Yagnavalkya reads thus: " In cases where the common stock undergoes an increase, an equal division is obtained " (1).
In his commentary on this text Vijnyaneshwara has observed as follows: " Among unseparated brothers, if the common stock be improved or augmented by any one of them through agriculture, commerce or similar means, an equal distribution nevertheless takes place; and a double share is not allotted to the acquirer " (2).
Sir Dinshah Mulla, who delivered the judgment of the Privy Council in the case of Shiba Prasad Singh (3) has observed that the words of Yagnavalkya mean that " if a member of a joint family augments joint property, whatever may be the mode of augmentation, the property which goes to augment the joint family property becomes part of the joint family property, and he is entitled on a partition to an equal share with the other members of the family, and not to a double share, as in some other cases dealt with in the preceding verses.
This is the placitum on which the whole doctrine of merger of estates by the blending of income is founded " (p. 349).
It would thus be seen that according to this decision the doctrine of blending or throwing into the common stock is based on the text just quoted.
With very great respect, however, the text of Yagnavalkya and the comments made by Vijnyaneshwara on it do not appear to have any relation to the doctrine of blending as it has been judicially evolved.
The context of the discussion both in the text of Yagnavalkya and in the commentary clearly shows that what is being discussed is the acquisition of property by a coparcener with the use of the family stock; in other words, taking the benefit of the family stock and making its use if a coparcener through trade, agriculture or any other means augments the initial or original family stock, the augmentation thus made is treated as forming part of the original stock and an accretion to it, and in this augmentation the acquirer is not given any extra share for his special exertions.
(1) Ch. 1, sect.
4, 30.
(2) Mitakshara, ch.
1. sect.
(3) (1932) L.R. 59 I.A. 331.
785 This position is clarified by the comments made by Sulapani.
Says Sulapani: " that an equal division is here specifically ordained; for in a partnership with a common stock, the difference in the gains of each individual member is not to be taken into account at the time of partition.
" Vijnyaneshwara observes that this text is intended to be an exception to the text of Vasishtha which allows two shares to the acquirer and which is cited in the Mayukha (1).
It would thus be clear that the relevant text and the commentary are not dealing with a case where the separate property of a coparcener independently acquired by him is thrown into the common stock with the deliberate intention of extinguishing its separate character and impressing upon it the character of the joint family property.
The subject matter of the discussion is addition to the common stock made by the efforts of a coparcener with the assistance of the common stock itself.
Therefore, in our opinion, the said text cannot be treated as the basis for the doctrine of blending as it has been judicially evolved.
It is, we think, unnecessary to investigate whether any other text can be treated as the foundation of the said doctrine since the said doctrine has been recognised in several decisions and has now become a part of Hindu law.
In Rajani Kanta Pal vs Jaga Mohan Pal (2) the Privy Council held that " Where a member of a joint Hindu family blends his self acquired property with property of the joint family, either by bringing his self acquired property into a joint family account, or by bringing joint family property into his separate account, the effect is that all the property so blended becomes a joint family property." The question which falls for our decision is: Does this principle apply in regard to a property held by a Hindu female as a limited owner? In our opinion, it, is difficult to answer this question in favour of the; appellants.
The rule of blending postulates that a;, coparcener who is interested in the coparcenary property and who owns separate property of his own may, (1) The Vyavahara Mayukha, Pt. 1, by Vishvanath Narayan Mandlik, 215.
(2)(1923) L.R. 50 I.A. 173.
786 by deliberate and intentional conduct treat his separate property as forming part of the coparcenary property.
If it appears that property which is separately acquired has been deliberately and voluntarily thrown by the owner into the joint stock with the clear intention of abandoning his claim on the said property and with the object of assimilating it to the joint family property, then the said property becomes a part of the joint family estate ; in other words, the separate property of a coparcener loses its separate character by reason of the owner 's conduct and get thrown into the common stock of which it becomes a part.
This doctrine therefore inevitably postulates that the owner of the separate property is a coparcener who has an interest in the coparcenary property and desires to blend his separate property with the coparcenary property.
There can be no doubt that the conduct on which a plea of blending is based must clearly and unequivocally show the intention of the owner of the separate property to convert his property into an item of joint family property.
A mere intention to benefit the members of the family by allowing them the use of the income coming from the said property may not necessarily be enough to justify an inference of blending; but the basis of the doctrine is the existence of coparcenary and coparcenary property as well as the existence of the separate property of a coparcener.
How this doctrine can be applied to the case of a Hindu female who has acquired immovable property from her father as a limited owner it is difficult to understand.
Such a Hindu female is not a coparcener and as such has no interest in coparcenary property.
She holds the property as a limited owner, and on her death the property has to devolve on the next reversioner.
Under Hindu law it is open to a limited owner like a Hindu female succeeding to her mother 's estate as in Madras, or a Hindu widow succeeding to her husband 's estate, to efface herself and accelerate the reversion by surrender; but, as is well known, surrender has to be effected according to the rules recognised in that behalf.
A Hindu female owning a limited estate cannot circumvent the rules of surrender 787 and allow the members of her husband 's family to treat her limited estate as part of the joint property belonging to the said family.
On first principles such a result would be inconsistent with the basic notion of blending and the basic character of a limited owners ' title to the property held, by her.
This aspect of the matter has apparently not been argued before the courts below and has not been considered by them.
Thus, if the doctrine of blending cannot be invoked in regard to the property held by Channamma, the appellants ' claim in respect of the said property can and must be rejected on this preliminary ground alone.
However, we will briefly indicate the nature of the evidence on which the plea of blending was sought to be supported.
It appears that in 1921 a deed of maintenance was executed in favour of Gurushantappa 's widow Parvathamma by the three surviving brothers of Gurushantappa.
This deed was attested by their father Kari Ramappa.
It is clear that this deed includes some of the lands which Channamma had acquired by succession to her father (exhibit A 10).
Subsequently, on July 5, 1923, some additional properties belonging to Channamma were charged to the said maintenance (exhibit A 11).
It also appears that pattas in respect of the same lands belonging to Channamma were obtained in the names of the members of the family; and consequently, the said pattas were shown in the relevant revenue papers.
Broadly stated, that is the nature of the evidence on which the plea of blending rests.
It is obvious that even if the doctrine of blending were applicable it would be impossible to hold that the transactions on which it is sought to be supported can lead to the inference that Channamma did any act from which her deliberate intention to give up her title over the properties in favour of the members of her husband 's family can be inferred.
It is not difficult to imagine Channamma 's position in the family.
If her husband and her sons dealt with her property as they thought fit to do Channamma may not know about it, and even if she knew about it, may not think it necessary to object 788 because she would not be averse to giving some income from her property to her sons or to her widowed daughter in law.
As we have already pointed out, the conduct of the owner on which the plea of merger can be invoked must be clear and unequivocal, and the evidence about it must be of such a strong character as to justify an inference that the owner wanted to extinguish his title over the property and impress upon it the character of the joint family property.
Besides, as we will later point out, Channamma executed a deed of surrender in 1938 and the said document is wholly inconsistent with the plea that she intended to give up her title to the property in favour of her husband 's joint family.
However, this discussion is purely academic since we have already held that the principle of blending cannot be invoked in respect of the limited estate held by Channamma.
Therefore, we must hold that the High Court was right in rejecting the appellants ' claim in respect of the properties in Jonnagiri.
That takes us to the properties in Schedule C in respect of which the trial court had decreed the appellants ' claim and the High Court has rejected it.
This property has been obtained by respondent 1 as a result of the decree passed in O. section No. 5 of 1940.
The property originally belonged to Virupakshappa, and in O. section No. 5 of 1940 respondents 2 and 1 claimed a declaration against the two widows of Virupakshappa, their daughter and certain alienees.
The declaration claimed was that the wills of Virupakshappa therein specified were invalid and inoperative and that the respondents had reversionery right to Virupakshappa 's estate after the lifetime of his widows and daughter.
A further declaration was also claimed that alienations and gifts specified in the plaint were invalid beyond the lifetime of the widows and the daughter of Virupakshapna.
This suit ended in a compromise decree, and it is common ground that the properties in Schedule C came to the share of respondent 1 by this compromise decree.
The question which has been argued before us in respect of these properties is whether or not the appellants 789 are entitled to a share in these properties.
The appellants contend that respondent 1 had joined respondent 2 in the said suit as representing their undivided family and the properties acquired by him under the compromise decree passed in the said suit has been allotted to him as representing the whole of the family.
On the other hand, respondent 1 contends that he joined respondent 2 in his individual character and the decree must inure for his individual benefit.
It is clear that at the time when the said suit was filed respondent 2 was a presumptive reversioner and not respondent 1 ; but it appears that respondent 2 wanted the help of respondent 1 to fight the litigation, and both of them joined in bringing the said suit.
It is common ground that respondent 2 asked Neelamma whether she would like to join the litigation.
Respondent 2 has stated in his evidence that Neelamma was not willing to join the said litigation and respondent 1 has supported this version.
The High Court thought that the evidence of Neelamma was also consistent with the story set up by respondent 1.
That is one of the main reasons why the High Court held that the decree passed in the said suit did not enure for the benefit of the family.
In assuming that Neelamma supported the version of respondent 1 the High Court has obviously misread her evidence.
This is what Neelamma has stated in her evidence: " Defendants 1 and 2 came to me at the time of filing their suit and said that the expenses are likely to be heavy and that minors ' properties would not be wasted.
1 said 1 had no objection and gave my consent." The High Court has read her evidence to mean that she was not prepared to waste the properties of her minor sons and so she refused to join the adventure, and in doing so it thought that the statement of respondent 2 was that the minors ' properties should not be wasted, whereas according to the witness the said statement was that the minors ' properties "would" not be wasted.
It would be noticed that it makes substantial difference whether the words used were " would not " or " should not.
" 790 We have no doubt that on the evidence as it stands the inference is wholly unjustified that Neelamma refused to join respondents 1 and 2.
Besides, as we have already pointed out, the evidence of respondents 1 and 2 have been disbelieved by both the courts, and in fact the conduct of respondent 1 whereby he wanted to defeat the claims of his nephews has been very strongly criticized by both the courts.
Therefore, we feel no hesitation in holding that the trial court was right in coming to the conclusion that respondents 1 and 2 consulted Neelamma and with her consent the suit was filed and was intended to be fought by the two respondents not for themselves individually but with the knowledge that respondent 1 represented the undivided family of which he was the manager.
If that be so, then it must follow that the decree which was passed in favour of respondent 1 was not for his personal benefit but for the benefit of the whole family.
In this connection it is necessary to bear in mind that respondent 1 has not shown by any reliable evidence that the expenses for the said litigation were borne by him out of his pocket.
It is true that both the courts have found that respondent 1 purchased certain properties for Rs. 600/ in 1925 (exhibit B 4).
We do not know what the income of the said properties was; obviously it could not be of any significant order; but, in our opinion, there is no doubt that where a manager claims that any immovable property has been acquired by him with his own separate funds and not with the help of the joint family funds of which he was in possession and charge, it is for him to prove by clear and satisfactory evidence his plea that the purchase money proceeded from his separate fund.
The onus of proof must in such a case be placed on the manager and not on his coparceners.
But,, apart from the question of onus, the evidence given by respondent 1 in this case has been disbelieved, and in the absence of any satisfactory material to show that respondent 1 had any means of his own it would be idle to contend that the expenses incurred for the litigation in question were not borne by the joint 791 family income.
Therefore, apart from the fact that Neelamma was consulted and agreed to join the adventure on behalf of her sons, it is clear that the expenses for the litigation were borne by the whole family from its own joint funds.
This fact also shows that the property acquired by respondent 1 under the compromise decree was acquired by him as representing the family of which be was the manager.
The result is that the view taken by the High Court in respect of the properties in Schedule C must be reversed and that of the trial court restored.
That leaves a minor point about three items of property, Serial Nos. 63, 64 and 65, in Schedule A.
These items of property form part of Jonnagiri property, and we have already held that the appellants cannot make any claim to the whole of this property.
It appears that though the trial judge passed a decree in favour of the appellants in respect of Serial Nos. 4 to 61 in Schedule A, he did not recognise the appellants ' share in the three serial numbers in question because he held that they were not part of the joint family property but belonged exclusively to respondent 1.
It also appears that these properties originally belonged to the joint family of the parties but they were sold by Kari Ramappa and his two brothers to Channappa as long ago as 1898.
That is how they formed part of Channappa 's estate.
Both the courts have found that the sale deed in question was a real and genuine transaction, and they have rejected the appellants ' case to the contrary.
Respondent 1 claims these items under a deed of surrender executed in his favour by Channamma (exhibit B. 3) on December 5, 1938.
This document is accepted as genuine by both the courts and it is not disputed that the surrender effected by it is valid under Hindu law.
Indeed this document is wholly inconsistent with the appellants ' case that Channamma wanted to convert her separate properties into properties of the joint family of her husband.
Therefore, there is no substance in the appellants ' argument that they should be given a share in these three items of property.
792 The result is the appeal is partly allowed and the decree passed by the High Court is modified by giving the appellants their half share in the properties described in Schedule C.
The rest of the decree passed by the High Court is confirmed.
In the circumstances of this case the parties should bear their own costs. ' Appeal allowed in part.
[/INST]A decree dated September 2, 1938, in a suit for partition of joint Hindu family property awarded a house to the share of one J and his four minor sons.
J failed to execute the decree.
On November 23, 1949, an application was made by the appellants, the four sons of J, for execution of the decree stating that three of them had been minors till then and one of them was still a minor and so no question of limitation arose.
The respondent objected that the application was barred under section 7 of the Indian Limitation Act.
The appellants contended that section 7 did not apply to a partition decree and that section 7 was no bar as j could not have given a valid discharge of the liability under the decree in view of the provisions of 0. 32 of the Code of Civil Procedure.
Held, that the application for execution was barred by limitation.
J, the managing member of the family could have given a discharge of the liability under the partition decree by accepting possession on behalf of his minor sons without their consent and so time ran against them under section 7 from the date of the decree.
Order 32, rr.
6 and 7 were no bar to j giving a discharge of the liability under the decree as it was neither a case of receipt of any money or movable property nor was there any question of entering into an agreement or compromise on behalf of the minors.
Ganesha Row vs Tuljaram Row (1913) L.R. 40 1.A. 132, Parmeshwari Singh vs Ranjit Singh, A.I.R. 1939 Pat.
33 and Letchmatsa Chetty vs Subbiah Chotty, Mad. 920, referred to. 876
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<s>[INST] Summarize the judgementN: Criminal Appeal No. 143 of 1975.
From the Judgment and order dated 18th February 1975 of the Andhra Pradesh High Court in Criminal Appeal No. 583 and CMP Nos 10 103 of 1975.
D. Mookherjee and A. V. V. Nair, for the Appellants.
P. Ram Reddy and P. Parameshwara Rao, for the Respondent.
The Judgment of the Court was delivered by 543 FAZAL ALI, J.
Five accused persons, namely, accused No. 1 K. A Ramachandra Reddy, No. 2, Manne Sreehari, No. 3 Prabhakar Reddy, No. 4 Sudhakara Reddy and No. 5 Bhaskar Reddy were put on trial in the Court of First Additional Sessions Judge, Nellore under sections 147, 148, 302/149 and 302/34 I.P.C. for having caused the murder Of the decessed Venugopala Reddy resident of Rachakandrika village of Nellore District.
The learned Sessions Judge after recording the evidence of the prosecution and hearing the arguments rejected the entire prosecution case and held that the prosecution had miserably failed to prove the case against any of the accused and he accordingly acquitted all the five accused by his judgment dated July 25, 1973.
The State of Andhra Pradesh thereafter filed an appeal under section 417 of the Code of Criminal Procedure against the order of acquittal passed by the learned Additional Sessions Judge, Nellore.
The appeal was heard by a Division Bench of the Andhra Pradesh High Court which reversed the order of acquittal passed by the learned Sessions Judge only in respect of accused Nos. 1 & 2 and convicted them under section 302/34 I.P.C. and sentenced them to 'imprisonment for life.
The acquittal of the other accused Nos.
3 to 5 was confirmed by the High Court.
the two appellants namely K. Ramachandra Reddy and Manne Sreehari to be referred to hereafter as Accused Nos. 1 & 2 respectively have filed the present appeal in this Court under section 2A of the Supreme Court (Enlargement of Criminal Appellate Jurisdiction) Act of 1970.
A perusal of the judgment of the High Court clearly reveals that the learned Judges have not accepted the major part of the evidence adduced by the prosecution in support of the case against the accused and have founded the convicton of the accused Nos. 1 & 2 solely on the basis of Ext.
P 2 a dying declaration alleged to have been made by the deceased Venugopala Reddy at Dr. Ramamurthi Nursing Home before a Magistrate the next day after he is said to have been assaulted.
The High Court on a careful reading of the dying declaration held that it was a truthful version of the manner in which the deceased was assaulted by the accused and as the deceased had made a full disclosure to a Magistrate in the presence of a Doctor who had testified to the fact that the deceased was in a fit state of mind to make a statement there was no reason to disbelieve the dying declaration which the High Court believed to be genuine and true.
The arguments of the learned counsel for the appellants naturally centered round the reliability of Ext.
P 2 the dying declaration recorded by the Magistrate at the Nursing Home.
Appearing for the appellants Mr. Debabrata Mookerjee submitted two propositions before us : (1) that the High Court in reversing the acquittal of the appellants completely overlooked the principles laid down by this Court that the High Court ought not to interfere with an order of acquittal in appeal without displacing the reasons given and the circumstances relied upon by the Trial Court and certainly not in a case where two views are possible; and 544 (2) that the High Court failed to consider the suspicious circumstances under which the dying declaration was made which went to show that it was hot a voluntary or true disclosure by the deceased but was the result of tutoring and prompting by his relations.
On the other hand Mr. Ram Reddy the Senior standing counsel for the State of Andhra Pradesh submitted that the High Court was fully justified in relying upon the dying declaration which was both true and voluntary and whose correctness had been testified by the Magistrate and the Doctor.
The learned counsel also relied on some other evidence in order to corroborate the genuineness of the dying declaration .
Before examining the contentions raised by counsel for the parties, it may be necessary to give a resume of the prosecution case shorn of its essential details.
It appears that there was serious political rivalry between Bhaskar Reddy A 5 and the deceased Venugopala Reddy over the election of the local Panchayat Committee known as Samithi.
It appears that some allegations or misappropriation or public funds having been made against accused No. 5 Bhaskar Reddy the deceased displaced him from the Presidentship of the Panchayat Samithi in a meeting called a few day before the death of the deceased where Bhaskar Reddy was not invited.
This is supposed to have provided an immediate provocation for the accused to have attacked the deceased.
According to the prosecution the deceased had gone to his Petrol Pump in Tada Bazar and after sunset was leaving for his village through the main highway and after having traversed about half a mile when he reached the place of occurrence situate near the mango grove he was surrounded by the five accused who pounced up him and assaulted him with stones, knives and sticks.
Venugopala fell down and the accused ran away after assaulting him.
S and 6 who were keeping watch over the mango grove were attracted to the scene of occurrence by the cries of the deceased and P.W. S was sent by P.W. 6 to the village Rachakandrika to call the relations of the deceased.
The errand entrusted to P.W. S having been executed P.W. 1 the son of the deceased and P.W. 2 his cousin arrived at the spot and found the deceased in a sitting posture being attended to by P.W. 6 with a large number of injuries on his person.
In fact it would appear from the post mortem report that the deceased had sustained as many as 48 injuries on his person.
IT is further alleged by the prosecution that P.W. I asked his father regarding the occurrence and the deceased disclosed the names of accused Nos.
I to 5 as his assailants.
Thereafter the deceased was taken in a lorry to the Nursing Home of Dr. Ramamurthi at Nellore and P.W. 7 Sarpanch of the village and a very close and intimate friend of the deceased also accompanied the deceased in the lorry upto Nellore.
Dr. Ramamurthi had gone to a cinema but on being sent for he arrived at the Nursing Home and attended to the deceased.
He directed P.W. 1 to rush to the police station at Sullurpet to report he occurrence.
P.W. 1 went to Sullurpet and reported the matter to the Sub inspector who made a station diary entry Ext.
The Sub lnspector.
however, did not choose to register.
545 the case on the basis of the diary entry but proceeded to Nellore.
We A would like to mention here that Ext.
D 4 was the real F.I.R. in the case within the meaning of section 154 Cr.
P.C. and the Sub Inspector committed a dereliction of duty in not registering the case on receiving the First Information Report about the death of the deceased from P.W. 1 the son of Venugopala Reddy.
We might also mention that the Sub Inspector P.W. 15 was also a friend of the deceased being his class fellow.
It may be pertinent to note here that although a report was made by P.W. 1 to the Sub Inspector yet the names of the appellants were not at all mentioned in the station diary entry which was based on the verbal report given by P.W. 1.
No reason or explanation seems to have been given by the prosecution for the non disclosure of the names of the appellants by P.W. 1 if in fact he had been told these names by the deceased himself at the spot.
When the Sub Inspector P.W. 15 reached the Nursing Home he was asked by the Doctor P.W. 17 to get a Magistrate so that the dying declaration of the deceased may be recorded.
Acting upon the instructions of P.W. 17 the Sub Inspector went to the Magistrate P.W. 11 who arrived at the Nursing Home and recorded the dying declaration of the deceased which is Ext.
P 2 in the case and which forms the basis of the conviction of the two appellants.
Thereafter in view of the critical condition of the deceased Dr. Ramamurthi advised that the deceased should be taken to the Madras General Hospital and accordingly the relations of the deceased took the deceased to the Madras General Hospital where also he is said to have made another dying declaration before the police.
This dying declaration, however, was rejected both by the Sessions Judge and the High Court and it is not necessary for us to refer to this part of the evidence.
Even the oral dying declaration said to have been made by E the deceased to P.Ws. 1 and 2 and others also has not been accepted either by the Sessions Judge or by the High Court.
The accused pleaded innocence and averred that they had been falsely implicated due to enmity.
Thus it would appear that the conviction of the accused depends entirely on the reliability of the dying declaration Ext.
The dying declaration is undoubtedly admissible under section 32 of the Evidence Act and not being a statement on oath so that its truth could be tested by cross examination, the Courts have to apply the strictest scrutiny and the closest circumspection to the statement before acting upon it.
While great solemnity and sanctity is attached to the words of a dying man because a person on the verge of death is not likely to tell lies or to concoct a case so as to implicate an innocent person yet the Court has to be on guard against the statement of the deceased being a result of either tutoring, prompting or a product of has imagination.
The Court must be satisfied that the deceased was in a fit slate of mind to make the statement after the deceased had a clear opportunity to observe and identify his assailants and that he was making the statement without any influence or rancour.
Once the Court is satisfied that the dying declaration is true and voluntary it can be sufficient to found the conviction even without any further corroboration.
The law on the subject has been clearly and explicitly enunciated 37 833 Sup CI/76 546 by this Court in Khushal Rao vs State of Bombay(l) where the Court observed as follows: On a review of the relevant provisions of the Evidence Act and of the decided cases in the different High Courts in India and in this Court, we have come to the conclusion, & agreement with the opinion of the Full Bench of the Madras IB High Court, aforesaid, (1) that it cannot be laid down as an absolute rule of law that a dying declaration cannot form the sole basis of conviction unless it is corroborated, (2) that each case must be determined on its own facts keeping in view tile circumstances in which the dying declaration was made; (3) that it cannot be laid down as a general proposition that a dying declaration is a weaker kind of evidence than other pieces of evidence; (4) that a dying declaration stands on the same footing as another piece of evidence and has to be judged in the light of surrounding circumstances and with reference to the principles governing the weighing of evidence, (S) that a dying declaration which has been recorded by Q competent magistrate in the proper manner, that is to say, in the form of questions and answers, and, as far as practicable, in the words of the maker of the declaration, stands on a much higher footing than a dying declaration which depends upon oral testimony which may suffer from all the infirmities of human memory and human character, and (6) that in order to test the reliability of a dying declaration, the Court has to keep in view the circumstances like the opportunity of the dying man for observation, for example, whether there was sufficient light if the crime was committed at night.
whether the capacity of the man to remember the facts stated had not been impaired at the time he was making the statement, by circumstances beyond his control.
that the statement has been consistent throughout if he had several opportunities of making a dying declaration apart from the official record of it; and that the statement had been made at the earliest opportunity and was not the result of tutoring by interested parties.
Hence, in order to pass the test of reliability, a dying declaration has to be subjected to a very close scrutiny, keeping view the fact that the statement has been made in the absence of the accused who had no opportunity of testing the veracity of the statement by cross examination.
" The above observations made by this Court were fully endorsed by a Bench of five Judges of this Court 'in Harbans Singh and Another vs State of Punjab(2) .
In a recent decision of this Court in Tapinder Singh vs State of Punjab(3), relying upon the earlier decision referred to above.
this Court observed as follows: (1) ; (2) [1962] Supp.
(1) S.C.R. 104.
(3) ; 547 lt is true that a dying declaration is not a deposition in court and ii is neither made on oath nor in the presence of the accused.
It is, therefore, not tested by cross examination on behalf of the accused.
But a dying declaration is admitted in evidence by way of an exception to the general rule against the admissibility of hearsay evidence, on the principle of necessity.
The weak points of a dying declaration just mentioned merely serve to put the court on its guard while testing its reliability, by imposing on it an obligation to closely scrutinise all the relevant attendant circumstances.
" In Lallubhai Devchand Shah and others vs State of Gujarat(1), this Court laid special stress on the fact that one of the important tests of the reliability of a dying declaration is that the person who recorded it must be satisfied that the deceased was in a fit state of mind and observed as follows: "The Court, therefore, blamed Dr. Pant for not questioning Trilok Singh with a view to test whether Trilok Singh was in a "fit state of mind" to make the statement.
The "fit state of mind" referred to is in relation to the statement that the dying man was making.
In other words, what the case suggests is that the person who records a dying declaration must be satisfied that the dying man was making a conscious and voluntary statement with normal understanding.
" We would now examine the dying declaration Ext.
P 2 in the light of the principles enunciated above.
To begin with, we would like to deal with the surrounding circumstances and the attendant factors which culminated in the dying declaration Ext.
P 2 made by the deceased at Dr. Ramamurthi Nursing Home.
According to the prosecution there were three clear occasions when the deceased was conscious and could have made a statement disclosing the names of his assailants.
The first occasion was at the place of occurrence itself, after the deceased is said to have been assaulted by the accused.
The persons who were present on this occasion were P.Ws. 1, 2, 5 & 6.
According to P.W. 1 (p. 5 of the printed Paper Book) the deceased even though he was groaning was in a condition to speak out and on being questioned he narrated the entire occurrence and disclosed the names of the five accused persons to P.W. 1.
The fact that the deceased had mentioned the names of all the accused to this witness has been disbelieved by 4 both the Courts and in our opinion rightly, because P.W. i did not make any mention of this fact either in the F.I.R. Ext.
D 4 or in his statement to the police.
Nevertheless from the statement of P.W. 1 who is the son of the deceased it is manifestly clear that the deceased was in a position to make a statement and yet he did not disclose the names of the assailants.
Similarly P.W. 2 (p. 15 of the Printed Paper Book ) categorically states that in his presence P.W. I asked the deceased as to how the incident took place and the deceased told him that all the five accused had assaulted him with sticks, stones and (1)[1971] 3 S.C.C. 767.
548 knives and then ran away.
This also shows that the deceased was conscious when he is said to have made this statement.
Lastly, there is the evidence of P.W. 6 (p. 29 of the Paper Book) who also says the although the witness could not hear what the deceased said yet he was speaking very slowly with his son.
Thus at the first stage, namely, when the deceased was at the spot he was in a position to make the statement and yet, according to the findings of the Courts below, he did not disclose the names of the assailants to any body.
The second occasion when the deceased could have disclosed the names of his assailants was at the time when he was carried in a lorry from the place of occurrence to Dr. Ramamurthi Nursing Home.
P.W. 1 (p. 8 of the printed Paper Book) categorically states that at the time when his father was put on the lorry he was groaning but he was in a position to talk.
The witness further goes on to state that 'none of the ' 'O to 30 persons who had gathered at the scene tried to ask the deceased as to how the incident took place.
Similarly P.W. 6 (p. 29 of the printed Paper Book) clearly stated that the injured was in a position to talk while he was being put on the lorry and about 50 to 60 persons were present there at that time.
The third occasion when the deceased could have disclosed the names of the assailants was when he reached the Nursing Home.
In this connection P.W. 1 (p. 9 of the printed Paper Book) has stated that on reaching the hospital the Doctor was sent for and at that time his father was conscious and was in a position to talk though he was groaning with pain.
He further admitted that he did not tell the Doctor what his father had told him.
Similarly P.W. 2 states (at p. 16 of the printed Paper Book) that when the Sub Inspector of Sullurpet came and saw the injured in the room of the Nursing Home the injured was in a position to talk but the Sub Inspector did not talk to him or question him on anything.
P.W. 15 the Sub Inspector of Sullurpet states (at p. 41 of the printed Paper Book) that he found about 20 persons at the Nursing Home gathered outside the Nursing Home and saw Dr. Ramamurthy attending on the injured inside when the injured was hl a conscious state.
From the evidence discussed above, it is clearly established that although the deceased was conscious at the place of occurrence, at the time when he was put on the lory and also at the time when he was brought to the Nursing Home and was in a position to speak he did not disclose the names of the assailants to any body.
This conduct of the deceased can be explained only on two hypotheses, namely, either the deceased was not conscious at all and was not in a position to talk to ally body or that even though he was conscious he did not disclose the occurrence to any body because under the stress and strain of the assault, which took place admittedly at a time when darkness had set in and there was very little moonlight, he was not able to identify the assailants.
No third inference can be spelt out from the conduct of the deceased in not disclosing the names of the assailants on these three occasions.
Further more, the fact that the deceased was not in a position to identify the assailants receives intrinsic support from the statement of P.W. 1 (at p. 6 of the printed Paper Book) where he clearly 549 states that he had seen A 3, A 4 and A l at A 5 's house about five years before the occurrence.
He further states that he did not know it his father knew A l, A 3 and A 4 well and by their names.
He further states that A 3 had visited his house five years ago and he could not say whether his father was present at that time.
Lastly the witness states that he had no other acquaintance with A 3 and A 4.
He also states that he came to know A 2 only after the occurrence of this case.
The learned Sessions Judge has rightly relied on these circumstances to come to the conclusion that the deceased did not know the names of the accused nor was he able to identify them in the darkness and this introduces a serious infirmity in the dying declaration itself.
It would be seen that in the dying declaration Ext.
P 2 the name of the accused No. l Ramachandra Reddy is clearly mentioned and so is the name of accused No. 2.
If according to P.W. l there was a clear possibility of the deceased not having known the names of A l, A 2 or A 3 then it is not understandable how these names could be mentioned by the deceased in his dying declaration unless the names were suggested to him by some body.
Against this background the presence of P.W. 2 the cousin of the deceased by his side even at the time when the dying declaration was recorded or a little before that clearly suggests that the possibility of prompting cannot be excluded.
Even the High Court has clearly Found that the possibility of prompting was there.
Dr. Ramamurthi P.W. 17 has stated that while the Magistrate was recording the statement of the injured, the injured was sitting for a while and was thereafter lying in the lap of P.W. 2 who was nursing him then.
Another important circumstance that has been considered by the learned Sessions Judge but overlooked by the High Court is that even though according to the evidence led by the prosecution the deceased was fully conscious in the hospital and had met persons from his village, his Friends and acquaintances including Dr. Ramamurthi P.W. 17 and the Sub Inspector P.W. 15 yet he did not make any statement to any of these persons nor did any of these persons try to question the deceased about the occurrence.
In fact the categorical evidence of P.W. 17 Dr. Ramamurthi is that from the time the patient was brought in the Nursing Home till the Magistrate arrived, the patient did not to any one including him.
The learned Sessions Judge has observed that this is a very extra ordinary and unnatural circumstances which throws a wood deal of doubt on the circumstances in which the dying declaration was recorded.
The Doctor was known to the deceased and yet neither the deceased talked to him nor did the Doctor make any inquiry from him.
On the other hand P.W. 15 the Sub Inspector has stated (at p. 42 of the printed Paper Book) that when the deceased had reached the Hospital he was not in a position to talk and was groaning.
P.W. 17 Dr. Ramamurthi has also stated that the state of mind of the deceased was restlessness.
He further deposed that till the Magistrate arrived, the witness had no opportunity to assess the mental capacity of the injured Venugopala Reddy.
It would appear from the evidence of P.W. 20 who made the postmortem that there were as many as 4 injuries on the person of the deceased out of which there were 28 incised wounds on the various parts of the body including quite a few gaping incised injuries.
In view of these serious injuries we find it difficult to believe that the deceased would have been in a fit state of mind to make a dying declaration.
The Magistrate P.W. 11 who recorded the dying 550 declaration has admitted that the injured was suffering from paid and he was not in a position to sign and so his thumb impression was taken.
The Magistrate further admitted that the injured was taking time to answer the questions.
The Magistrate further admitted that the injured was very much suffering with pain.
In spite of these facts the Magistrate appears to have committed a serious irregularity in not putting a direct question to the injured whether he was capable mentally to make any statement.
In the case of Lallubhai Devchand Shah referred to by us supra the omission of the person who recorded the dying declaration to question the deceased regarding his state of mind to make the statement was considered to be a very serious one and in our opinion in the instant case the omission of the Judicial Magistrate who knew the law well throws a good deal of doubt on the fact whether the deceased was really in a fit state of mind to make a statement.
The Sessions Judge has rightly pointed out that even though the deceased might conscious in the strict sense of the term, there must be reliable to show, in view of his intense suffering and serious injuries that he was in a fit state of mind to make a statement regarding the occurrence.
Having regard, therefore, to the surrounding circumstances mentioned above, which have not been fully considered by the High Court, we find it extremely unsafe to place any reliance on Ext.
p 2 particularly in view of the conduct of the deceased in not making any disclosure regarding the occurrence on the three previous occasions when he had a full and complete opportunity to name his assailants.
Lastly it is admitted that there was serious enmity between the parties.
P.W. 2 states (at p. 16 of the printed Paper Book) that there were ill feelings between the deceased and A l, A 2 to A 5.
While counsel for the State has submitted that the deceased was assauted due to enmity, the possibility cannot be ruled out that the accused may have been named because of the enmity.
The learned standing counsel for the State relied upon the statement of Dr. Ramamurthi who had given the certificate that the deceased was in fit state of mind to make a statement.
This certificate by itself would not be sufficient to dispel the doubts created by the circumstances mentioned by us and particularly The omission by tile Magistrate in not putting a direct question to the deceased regarding the mental condition of the injured when he was satisfied that the injured was suffering from severe pain and was not able to speak normally.
For these reasons, therefore, this case clearly falls within principles (5) and (6) laid down by this Court in Khushal Rao 's case (supra).
In these circumstances we feel that it would be wholly unsafe to found the conviction of the appellants on the basis of Ext.
P 2 Mr. P. Ram Reddy for the State submitted that Ext.
P 2 was corroborated by the presence of at least accused No. 1 near the petrol pump slightly before the occurrence, took place.
The presence of accused No. 1 in Tada Bazar near his village is not completely inconsistent with his guilt and being a resident of the village close by his presence in the Bazar can be explained on account of various reasons.
It was then submitted that the accused had been absconding.
The accused, how ever, surrendered within 14 days and this is not a circumstance which outweigh the effect of the suspicious circumstances under which 551 the dying declaration was made.
It seems to us that as the deceased did not know the names of the appellants nor did he know them from before he was not able to identify his assailants and the names were supplied by P.W. 2 his cousin just before the dying declaration was made.
Putting the prosecution case at the highest, there can be no doubt that the view taken by the learned Sessions Judge that the dying declaration did not amount to a truthful disclosure cannot be said to the against the weight of the evidence on the record and even if the High Court was in a position to take a view different from the one taken by the Sessions Judge on the same evidence, this would not be a ground for reversing the order of acquittal.
In Ram Jag and others vs The State of U.P.( ') this Court observed as followed: "Such regard and slowness must find their reflection in the appellate judgment, which can only be if the appellate court deals with the principal reasons that become influenced the order of acquittal and after examining the evidence with care gives its own reasons justifying a contrary view of the evidence.
It is implicit ill this judicial process that if two views of the evidence are reasonably possible, the finding of acquittal ought not to be disturbed." Thus in the instant case as two views were reasonably possible and therefore tile High Court was in error in disturbing the order of acquittal passed the Sessions Judge.
For The reasons given above, we are satisfied that the High Court was not at all justified in reversing the order of acquittal passed by the Sessions Judge.
The appeal is accordingly allowed, the conviction and sentence passed against the appellants are set aside and they are acquitted of the charges framed against them.
The appellants are directed to be set at liberty forthwith.
M.R.Appeal allowed.
[/INST]174 In exercise of the powers conferred by Clause (1) of article 352 of the Constitution The President of India, by proclamation dated December 23, 1971 declared that a grave emergency exists whereby the security of India is threatened by external aggression and the Maintenance of Internal Security Act (Act 26 of 1971), 1971 was published on July 2 1971, for effectively dealing with the emergency.
On November 16, 1974, the President of India, in exercise of the powers conferred by Clause (1) of article 359 of the Constitution declared: (a) that the right to move any court with respect to orders of detention which have already been made or which may hereafter be made under section 3(1)(c) of the (as amended by ordinance ll of 1974) for the enforcement of the rights conferred by Articles 14, 21 and Clauses (4) (5), (6) and (7) of Article 22 of the Constitution; and (b) All proceedings pending in any court or the enforcement of any of the aforesaid rights with respect to all orders of detention made under the said section 3(1)(c) shall remain suspended for a period of six months from the date of issue of the order.
Or the period during which the proclamation of emergency issued under Clause ll) of article 352 of the Constitution of India on December 3, 1971, is in force, whichever period expires earlier.
the order stood extended to the whole of the territory of India.
On June 20, 1975, the President of India, amended the above order by substituting 12 months for '6 months ' in the order.
On June 25, 1975, the President, in exercise of his powers conferred by Clause (2) of Article 352 of the Constitution declared that a grave emergency exists whereby the security of India is threatened by internal disturbances.
On June 27, 1975, in exercise of powers conferred by Clause (1) of article 359 the President declared that the right of any person (including a foreigner) to move any court for the enforcement of the rights conferred by Articles 14 21 and 22 of the Constitution and all proceedings pending in any court for the enforcement of the above mentioned rights shall remain suspended for the period during which the proclamation of emergency made under Clause (1) of Act.
352 of the Constitution on December 3, 1971, and on June 25, 1975, are both in.
force.
The Presidential order of June 27, 1975, further stated that the same shall be in addition to and not in derogation of any order made before the date of the aforesaid order under Clause (1) of article 359 of the Constitution.
on June 29, l 975, by another order, the President made the ordinance of June 27, 1975, applicable to the State of Jammu and Kashmir as well.
On September 25, 1975, the last paragraph in the Presidential order dated June 27 1975, was omitted.
The President promulgated the amending ordinances No. i and 7 of 1975, and replaced by the Maintenance of Internal Security (Amending Act) (No. 39 of 1975) Act introducing a new section 16A, and .
giving a deemed effect to section 7 of the Act as on from June 25, 1975, while the rest having a deemed effect from June 29, 1975.
By the same Act a new section 18 was also inserted with effect from June 25, 1975.
By the Constitution (Thirty eighth Amendment) Act, 1975, Articles 123, 213, 239(b), 352, 356, 359 and 368 were amended.
Clauses (4) and (5) were added in article 352 of the Constitution.
Broadly stated, the Thirty eighth Con Constitution (Amendment) Act renders the satisfaction of the President or the Governor in the relevant Articles final and conclusive and to be beyond any .
question in any court on any ground.
The power conferred on the President by article 352 shall include the power.
to issue different proclamations on different grounds being war or external aggression or internal disturbance or imminent danger of war or external aggression or internal disturbance whether or not there is a proclamation already issued by the President By Constitution Thirty Eight Amendment Act l '1975 new Clause (1A) was also added after Clause (1) of Article 359.
The Constitution Thirty ninth Amendment Act was published on August 10 1975, amending Articles 71, 329 and 329(A) and added Entries after Entry 86 in the 9th Schedule and the (Act 26 of 1971) 1971 as item 92 in the said Schedule.
175 On October 17, 1975, on ordinance 16 of 1975 was issued making further amendments ill section 16A of the maintenance of internal Security Act introducing sub Clause (8) and (9) to section 16A. On November 16, 1975 ordinance 22 of 1975 was issued making certain amendments in the Maintenance of Internal security Act inserting also sub section 2A ill section 16A.
All the amendments made by the (ordinance were given retrospective effect for the purpose of validating all Acts done previously. 'The said ordinances were published as the Maintenance of Internal Security (Amendment) Act 1976 (Act 14 of 1976) on Janurary ' '5, 1976.
The respondents detained under section 3(IA)(ii) read with section 3(2) of the maintenance of Internal Security Act (Act 26 of 1971 j as amended by the (Amendment Act 39 of 1975), 1975 challenged in several High Courts, the vires of the ordinance issued on June 27, 1975, by the President of India as unconstitutional and inoperative in law and prayed for (a) the setting aside of the said order and (b) for directing their release forthwith.
In come cases, they challenged the validity of the Thirty eight and I thirty ninth constitution Amendment Acts.
When these petitions came up for hearing, the appellant raised the preliminary objection to the maintainability on the ground that in asking For l release by the issuance of a writ of habeas Corpus.
the respondents were, in substance, claiming that they have been deprived of their personal liberty in violation of the procedure established by law, which plea was available to them under.
article 21 of the Constitution only and in view of the Presidential order dated June 27 1975, suspending the right to move for enforcement of the right conferred by that article, the petitions were liable to be dismissed at the threshold.
While the High Courts of Andhra Pradesh, Kerala and Madras have upheld The preliminary objection, this contention did not find favour with the High Courts of Allahabad, Bombay (Nagpur Bench), Delhi Karnataka, Madhya Pradesh, Punjab and Haryana respectively. 'I these High (courts broadly took the view that (a) despite the Presidential order it is open to the detenus to challenge their detention on the ground that it is ultra vires, as for example, by showing that the order, on the face of it, IS passed by an authority not empowered of pass it or it is not in exercise of the power delegated to the authority or that the power has been exercised in breach of the conditions prescribed in that behalf by the Act under which the order is passed, or that he order is not in strict conformity with the provisions of the Act.
Some of these High Court have further held that the detenus can attack the order of detention on the ground that it is mala fide, as for example, by showing that the authority did not supply its mind to the relevant considerations, or that the authority was influenced by irrelevant considerations or that the authority was influenced by improper motives.
The Nagpur Bench of the Bombay High Court read down section 16A(9) of the 1 implying an exception in favour of disclosure to the Court.
The High Court did not decide about the validity of the Thirty eighth and Thirty ninth Constitution Amendment Acts.
Accepting the States ' appeals, some by certificates granted by the High Court and some by special leave, the Court by majority (Khanna, J. dissenting), ^ HELD .
(Per majority A.N. Ray C.J. M.H. Beg.
Y.V. Chandrachud and P.N. Bhagwati JJ.) (1) In view of the Presidential Order.
Dated June 27, 1975, under Clause (1) of article 359.
no person has any locus standi to move any writ petition under Art 226 before a High Court for habeas corpus or any other writ or order or direction to challenge the legality of an order.
Of detention on the ground that the order is not under or in compliance with the Act or is illegal or is vitiated by mala fides factual or legal or is based on extraneous considerations.
[477 E F].
(2) Section 16A(9) of the is constitutionally valid.
[477 F] (3) Section 18 of the Maintenance of ' Internal Security Act, 1971 is not invalid.
[240 A D, 342 F G, 414 D] 176 (4)Article 21 of the Constitution is the sole repository of rights to life and personal liberty against State.
[246 B] Per A. N Ray J In view of the Presidential order dated June 27, 1975, under Clause (1) of article 359, no person has locus standi to move writ petitions under article 226 of the Constitution before a High Court for habeas corpus or any other writ or order or direction to enforce any right to personal liberty of a person detained under the on the grounds that the order of detention or the continued detention is for any reason not in compliance with the Act or is illegal or male fide [245 H, 246 A] Article 21 is the sole repository of rights to life and personal liberty against a State.
Any claim to a writ of hebeas corpus is enforcement of article 21 and .
is, therefore, barred by the Presidential order.
[246 B] Girindra Nath Banerjee v Birendra Nath Lal ILR 54 Cal. 727; Kinng emperor vs Shib Nath Banerjee 1972 Indian Appeals 241 and Makhan Singh vs State of Punjab [1964] (4) SCR 797 referred to.
Scope of judicial reivew in emergency.
In times of emergency the executive safeguards the life of the nation and, therefore, its actions either on the ground that these are arbitrary or unlawful cannot be challenged in view of the fact that considerations of security forbid proof of the evidence upon which the detention was ordered.
[219 B E] Liversidge vs Sir John Anderson ; Greene vs Secretary of State for Home Affairs ; Mohan Chaudhary vs Chief Commissioner Union Territory of Tripura ; and Makhan Singh vs ," State of Punjab [1964] 4 SCR 797 followed.
Queen vs Halliday Ex Parte Zadiq , referred.
Liberty is confined and controlled by law, whether common law or statute.
The safeguard of liberty is in the good sense of the people and in the system of representative and responsible Government which has been evolved.
If extraordinary powers are given, they are given because the emergency is extraordinary and are limited to the period of emergency.
Liberty is itself the gift of the law and may by the law forfeited or abridged.
[222 D, G] Zamora 's case [1916]2 Ac 107 and Liversidge vs Sir John Anderson ; , referred to.
The vital distinction between articles 358 and 359 is that Art 358 suspends the rights only in Article 19 to the extent that the Legislature can make laws contravening article 19 during the operation of a Proclamation of emergency and the Executive can take action which The Executive is competent to take under such laws Article 358 does not suspend any Fundamental Right.
While a proclamation of emergency is in operation the Presidential order under article 359(1) can suspend the enforcement of any or all Fundamental Rights.
Article 359(1) also suspends any pending proceedings for the enforcement of such Fundamental Right or Rights.
Another important distinction between the two Articles is that article 358 provides for indemnity.
whereas Article 359(1) does not: Article 359(1A) is on the same lines as article 358, but Article 359(1A) includes all Fundamental Rights which may be mentioned in a Presidential order aud is, therefore, much wider than article 358 which includes article lg only.
[223 E G] The purpose and object of article 359(1) is that the enforcement of any Fundamental Right mentioned in the Presidential order is barred or it remains suspended during the emergency.
The scope of article 359(1) is not only to restrict the application of the Article to the legislative field.
bet also to the acts of the Executive.
The object of Article 359(1) is not only that the right 177 to move this Court only is barred but also the right to move any High Court The bar created by article 359(1) applies to petitions for the enforcement of Fundamental Rights mentioned in the Presidential order whether by way of an application under article 32 or by way of application under article 226.
An application invoking habeas corpus under section 491 of the Code of Criminal Procedure cannot simultaneously be moved in the High Court.
[223 H, 224 D] Shri Mohan Chaudhary vs Chief Commissioner Union Territory of Tripura ; Makhan Singh vs State of Punjab [1964] 4 SCR 797 and Dr. Ram Manohar Lohia vs State of Bihar & ors. ; , applied.
The argument that jurisdiction and powers of this Court under article 32 and of the High Courts under article 226 are virtually abolished by the Presidential order without any amendment of the Constitution is incorrect.
No amendment to the Constitution is necessary because no jurisdiction and power either of this Court or of the High Court is taken away.
When a Presidential order takes away the locus standi of the detenu to move any court for the enforcement of Fundamental Rights for the time being, the jurisdiction and powers of this Court and of the High Courts remain unaltered.
[224 E F] Article 359(1) is not directed against any court, it is directed against an individual and deprives him of his locus standi.
If courts will in spite of the Presidential order entertain the applications and allow the detenu to enforce to start or to continue proceedings or enforce Fundamental Rights, Article 359(1) will be nullified and rendered otiose.
C D] Unlike the 1962 Presidential order, in the 1975 order, the suspension is not hedged with any condition of enforcement of any right under Articles 21 and 22.
The Presidential order is, therefore, a bar at the threshold.
[228 D E] Makhan Singh vs State of Punjab [1964] 4 SCR 797 and State of Maharashtra vs Prabhakar Pandurang Sangzgiri & Anr. ; , distinguished.
There are no natural rights.
Fundamental Rights in our Constitution are interpreted to be what is commonly said to be natural rights.
[229 C D] H. H. Kesvananda Bharti Sripadagalavaru vs State of Kerala [1973] SUPP.
I SCR 702.
followed.
Law means law enacted by the State.
Law means positive State made law The phrase "Procedure established by law" in article 21 includes substantive and procedural law.
A law providing for the procedure depriving a person of liberty must be a law made by statute.
[229 D E] A K. Gopalan vs Stale of Madras ; ; P. D. Shamdasani & ors vs Central Bank of India Ltd. ; ; Smt.
Vidya Verma through next friend R. V. section Mani vs Dr. Shiv Narain Verma ; , applied.
There is no difference between the expression "except according to procedure established by law" in article 21 and the expression "save by the authority of law" in article 31(1) or the expression "except by authority of law" in article 265.
It is incorrect to suggest that when article 21 was enacted, the founding fathers only enshrined the right to personal liberty according to procedure and did not frame the constitutional mandate that personal liberty could not be taken except according to law.
[232 B D] Part III of our Constitution confers Fundamental Rights in positive as well as negative language.
A Fundamental Right couched Couched negative language accentuates by reason thereof the importance of that right.
The negative language is worded to emphasize the immunity from State action as Fundamental Right.
Fundamental Rights have the texture of Basic Human Rights.
[229 G, 230 A B] State of Bihar.
vs Maharaja Dhiraja Sir Kameshwar Singh of Dhrbhanga & Ors.
at 988 989; A. K Gopalan vs State of Madras ; ; Rustom Cavasjee Cooper vs Union of India 571 and 576 to 578: Shambhu Nath Sarkar vs The State of West Bengal & Ors.
[1974] 14 833SupCI/76 178 1 SCR; Haradahan Saha & Anr.
vs State of West Bengal ; and Khudiram Das .v State of West Bengal & ors.
; , referred to.
Article 21 is our Rule of Law regarding life and liberty.
No other Rule of Law can have separate existence as a distinct right.
The negative language of Fundamental Right incorporated in Part III imposes limitations on the power of the State and declares the corresponding guarantees of the individual to that fundamental Right.
Limitation and guarantee are complementary.
The limitation of State action embodied in a Fundamental Right couched in a negative form is the measure of the protection of the individual.
[230 C D] Rustom Cavasji Cooper vs Union of India , applied.
Personal liberty in Article 21 includes all varieties of rights which go to make personal liberty other than those in article 19(1)(d).
[230 C C] Kharak Singh vs State of U.P. and ors.
[1964] 1 SCR 332 and Rustom Cavasjee Cooper v Union of India ; , referred to.
If any right existed before the commencement of the Constitution and the same right with its content is conferred by Part III as a Fundamental Right the source of that right is in Part III and not in any pre existing right.
Such pre constitutional rights have been elevated in Part III as Fundamental Rights.
If there is a pre constitution right which is expressly embodied as a Fundamental Right under our Constitution, the common law right has no separate existence Under Our Constitution.
If there be any right other than and more extensive than the Fundamental Right in Part III, such right may continue to exist under article 372.
[230 F H] Dhirubha Devi Singh Gohil vs State of Bombay , referred to.
B. Shankara Rao Badami and ors.
vs State of Mysore and Anr. ; @ 11 13, applied.
Apart from the remedy under the common law of torts, by way of suit for false imprisonment and claim for damages, there was no civil remedy for unlawful infringement of the right to personal liberty in India before the Constitution.
Even this remedy, after the amendment of section 491 of the Code of criminal Procedure became a statutory right in the nature of a habeas corpus.
The provisions of section 491 of the Criminal Procedure Code have been repealed by Act II of 1974 as being superfluous in view of article 226.
[231 C D] Waghela Rajsanji vs Sheik Masludin and ors.
14 I.A. 89 1) 96.
Satish Chandra Chakravarti vs Ram Dayal De I.L.R. @ 407 10, 425 426.
Baboo S/o Thakur Dhobi vs Mst.
Subanshi w/o Mangal Dhobi AIR 1942 Nagpur 99; Makhan Singh vs State of Punjab [1964] 4 SCR 797; District Magistrate Trivandrum vs K. C. Mammen Mappillai I.L.R. ; Matthen vs District Magistrate Trivandrum L.R. 66 I.A. 222.
Girindranath Banerjee vs Birendranath Pal ILR and King Emperor vs Sibnath Banerjee 72 1.A. 241, referred to.
There was no statutory right to enforce the right to personal liberty other than that in section 491 of the Criminal Procedure Code before the commencement of the Constitution which could be carried over after its commencement under article 372.
Law in article 21 will include all post constitutional statute, law including and by virtue of article 372 all pre constitutional statute law, including the I.P.C. and the Cr.
P.C. [231 F G] The present appeals do not touch any aspect of article 20.
Article 20 is a constitutional mandate to the judiciary and article 21 is a constitutional mandate to the Executive.
The expression "no person shall be prosecuted for the same offence more than once" in article 20 would apply only to the executive.
It is 179 incorrect to say that "State" in article 12 will also include the Judiciary and article 20 is enforceable against the Judiciary in respect of illegal orders.
[232 E F, G H] Makhan Singh vs State of Punjab [1964] 4 SCR 797 and Narayan Singh vs State of Delhi and ors.
; not applicable.
Articles 256, 265 and 361 have no relevance to displace the proposition that article 21 is the repository of rights to life and liberty.
Nor does an appeal in a criminal proceedings have anything to do with article 21.
[233 C D] Garikapatti Veerayya vs N. Subbiah Choudhury ; and Ahmedabad Mfg. & Calico Ptg.
Co. Ltd. vs Ram Tahal Ramnand and ors.
; , referred to.
The right arising from a decree is not a Fundamental Right and, therefore, will not be prima facie covered by a Presidential order under article 359(1) [233 G] Fundamental Rights including the right to personal liberty are conferred by the Constitution.
Any pre constitution rights which are included in article 21 do not after the Constitution remain in existence which can be enforced, if article 21 is suspended If it be assumed that there was any pre constitutional right to personal liberty included in article 21 which continued to exist as a distinct and separate right then article 359(1) will be an exercise in futility.
[234 A B] Makhan Singh vs State of Punjab explained.
The theory of eclipse is untenable.
The theory of eclipse refers to pre constitutional laws which were inconsistent with Fundamental Rights.
By reason of article 13(1) such laws did not became void but became devoid of legal force.
Such laws became eclipsed for the time being.
The theory of clipse has no relevance to the suspension of the enforcement of fundamental Rights under article 359(1).
The constitutional provisions conferring Fundamental Rights cannot be said to be inconsistent with article 13(1).
[234 B D] P. D. Shamdasani vs Central Bank of India Ltd. ; and Smt.
Vidya Verma through next friend R. V. section Mani vs Dr. Shiv Narain Verma ; , reiterated.
The Act in the present case is valid law and it has laid down procedure of applying the law.
The validity of the Act has not been challenged and cannot be challenged.
The Legislature has competence to make the law.
The procedure, therefore, cannot be challenged because article 21 and 22 cannot be enforced. 'The suggestion that the power of the Executive is widened is equally untenable.
[235 E F] The fact that section 491 of the Criminal Procedure Code has been abolished in he new Code establishes that the pre existing right was embodied as a Fundamental Right in the Constitution.
The right to personal liberty became identified with Fundamental Right to personal liberty under article 21.
[236 A] The Presidential orders does not alter or suspend any law.
The rule of law is not a mere catchword or incantation.
The certainty of law is one of the elements in the concept of the rule of law.
The essential feature of rule of law is that the judicial power of the State is, to a large extent, separate from the Executive and the Legislature.
[236 B C] It is not correct to argue that if pre existing law is merged in article 21, there will be conflict in the Article 372.
The expression "law in force" in article 372 cannot include laws which are incorporated in the Constitution, viz. in Part III.
The expression "law" in Articles 19(1) and 21 takes in the statute law.
[235 B] The Presidential order under article 359(1) is not a law.
The order does not repeal any law either.
The contention that permanent law cannot be repealed by temporary law is misplaced.
[235 C] The entire concept in article 21 is against Executive action.
There is no question of infringement of Fundamental Right under article 21 where the detention 180 complained of is by a private person and not by a State or under the authority or orders of a State.
[235 D] The Executive cannot detain a person otherwise than under valid legislation.
The suspension of any Fundamental Right does not affect this rule of the Constitution.
Article 358 does not detract from the position that the Executive cannot act to the prejudice of a person without the authority of law.
[237 A F] Rai Sahib Ram Jawaya Kapur & ors.
vs The State of Punjab ; MP.
State vs Bharat Singh ; ; Dy.
Collector vs Ibrahim & Co. Bennet Coleman & Co vs Union of India ; and Meenakshi Mills vs Union of India , discussed and distinguished.
The Constitution is the mandate.
The Constitution is the rule of law.
No one can arise above the rule of law.
The suspension of right to enforce Fundamental Rights has the effect that the emergency provisions in Part XVIII are by themselves the rule of law during times of emergency.
There cannot be any rule of law other than the constitutional rule of law. 'There cannot be any pre constitution or post constitution rule of law which can run counter to the rule of law embodied in the Constitution, nor can there be any invocation to any rule of law to nullify the constitutional provisions during the times of emergency.
[224 B, 238 D E] Eshugbayi Eleko vs Officer Administering the Govt.
Of Nigeria ; and Christie and Anr.
vs Leachinsky ; not applicable.
The expression "for any other purpose" in article 226 means for any purpose other than the enforcement of Fundamental Rights.
A petition for habeas corpus by any person under article 226 necessarily invokes a question whether the detention is legal or illegal.
An executive action if challenged to be ultravires a statute cannot be challenged by any person who is not aggrieved by any such ultra vires action.
[239 D E] The expression "purported to be made under section 3 of the Act" in section 18 will include an Executive act made by the District Magistrate within the scope of his authority as District Magistrate even if the order is made in breach of the section or is mala fide.
[240 A B] Hari Ram Singh vs The Crown Bhagchand Dagadusa vs The Secretary of State for India L.R. 54 I.A. 338 @ 352; Albert West Meade vs The King AIR 1948 P.C. 156 at 157 59; Animistic vs Foreign Compensation etc. ; at 212, 213 and 237 and Dakshina Ranjan Ghosh vs Omar Chand Oswal I.L.R. SO Cal.
992 at 995 1003, applied.
Poona Municipal Corporation vs D. N. Deodhar ; ; Kala Bhandar vs Municipal Committee and Indore Municipality vs Niyamultulla AIR 1971 SC 97 and Joseph vs Joseph not applicable.
There is no question of excessive delegation in section 18 which lays down the law.
To contend that section 18 applies only to post detention challenge is wrong.
Section 18 applies to all orders of detention.
Section 18 of is only an illustration of the Act by the officers authorised by the Act.
[240 C E] Section 16A(9) of the Act is valid.
It is a rule of evidence and it is not open either to the detenu or the Court to ask for the grounds of detention.
[246 C] Materials and information on which orders of preventive detention are passed necessarily belong to a class of documents whose disclosures would impair the proper functioning of Public service and administration.
[242 D] Liversidge vs John Anderson ; at 221, 253, 254, 266, 267, 279, 280 and Roger 's case @ 400, 401, 405, applied.
181 Legislature has enacted 5.
16A(9) providing for a general exclusion from evidence of all such material as would properly fall within the classification instead of forcing the State to claim in individual cases privilege under sections 123, 162 of the Evidence Act or under article 22(6) of the Constitution.
[242 E F] Section 16A cannot be said to be an amendment to article 226.
The jurisdiction to issue writs is neither abrogated nor abridged.
Section 16A(9) enacts provisions analogous to a conclusive proof of presumption.
Such a provision is a genuine rule of evidence.
It is in the nature of an explanation to sections 123 and 162 of the Evidence Act.
Section 16A(9) is a rule of evidence.
When the detaining authority is bound by section 16A(9) and forbidden absolutely from disclosing such material no question can arise of adverse inference against the authority.
[242 G H] Section 16A(9) cannot be read implying an exception in form of disclosure to the Court.
Such disclosure to the Court alone and not to the detenu will introduce something unknown to judicial procedure and will bring in an element of arbitrariness and preclude both the parties from representing their respective cases.
The view of the detaining authority is not to be substituted by the view of the court.
[243 A C] State of Bombay v Atma Ram Sridhar Vaidya ; ; Shiban Lal Saksena vs State of Uttar Pradesh and ors.
; ; Rameshwar Shaw vs District Magistrate Burdwan and Anr. ; ; Jaichand Lal vs W. Bengal [1966] Supp.
SCR 464 and Dr. Ram Manohar Lohia vs State of Bihar [1966] I SCR 709, referred to.
The theory of good return mentioned in the English decisions is based on the language of Habeas Corpus Act and the Rules of the Supreme Court of England.
The practice of our Court is different.
[243 C D] M. M. Damnoo vs J. K. State ; and A. K. Gopalan vs State of Madras ; , distinguished.
It is not competent for any court to go into questions of malafides of the order of detention or ultra vires character of the order of detention or that the order was not passed on the satisfaction of the detaining authority.
Section 16A of the Act contains definite indications of implied exclusion of judicial review on the allegations of mala fide.
The reason why section 16A has been enacted is to provide for periodical review by Government and that is the safeguard against any unjust or arbitrary exercise of power.
The production of the order which is duly authenticated constitutes a peremptory answer to the challenge.
[243 G H, 244 A, 245 B] In view of the inability of the court to grant any relief on the basis whether order of detention is the result of malice or ill will, the detention of malafides is not only ineffective but also untenable.
[244 DE] Lawrence loachim Joseph D 's Souza vs The State of Bombay ; @ 392, 393; Smith vs East Elloc Rural District Council & ors.
at 776 and Dr. Ram Manohar Lohia vs State of Bihar and ors.
; , referred to.
A decision on a point not necessary for the purpose or which does not fall to be determined in that decision becomes obiter dictum.
[227 F] Maharaja Dhiraja Madhav Rao Jivaji Rao Scindia Bahadur and 193 to 194, referred to.
Per M. H. Beg, 1.
A prima facie valid detention order, that is to say, one duly authenticated and passed by an officer authorised to make it recording a purported satisfaction to detain the petitioner under the , which is operative either before or after its confirmation by the Government, is a 182 complete answer to a petition for a writ of habeas corpus.
Once such an order is shown to exist in response to a notice for a writ of habeas corpus, the High Court cannot inquire into its validity or vires on the ground of either mala fides of any kind or of non compliance with any provision of the in habeas corpus proceedings.
[371 G H, 372 A] The fundamental law found in the Constitution is paramount.
The Constitution provides the test for the validity of all other laws.
It seeks to determine the spheres of executive and legislative and judicial powers with meticulous care and precision.
The judicial functions though wider in range when interpreting or applying other articles of the Constitution, particularly Articles 14 and 19, the enforcement of which is also suspended during the current emergency, is especially constricted by the elaborate provisions of Articles 21 and 22, which deal with personal liberty and preventive detention.
The wider the sweep of the provisions of Articles 21 and 22 the more drastic must be the effect of suspending their enforcement.
Suspension does not and cannot mean retention under a disguise.
[312 F H] Marbury vs Madison [1803] I Cranch 137; A. K. Gopalan vs State of Madras ; @ p. 109, referred.
The only Rule of Law which can be recognised by courts of our country is what is deducible from our Constitution itself.
The Constitution is an embodiment of the highest "positive law" as well as the reflection of all the rules of natural or ethical or common law Lying behind it which can be recognised by courts.
The spirit of law or the Rule of Law Cannot hover ominously around like some disembodied ghost serving as a substitute for the living Constitution.
It has to be found always within and operating in harmony with and never outside or in conflict with what our Constitution enjoins.
[313 A, D E] The most important object of making certain basic rights fundamental by the Constitution is to make them enforceable against the State and its agencies through the Courts.
[329 F] Under our constitutional jurisprudence courts cannot, during a constitutionally enjoined period of suspension of the enforceability of fundamental rights through courts, enforce hat may even be a Fundamental Right sought to be protected by Part III of the Constitution.
[314 C D] The enforceability of a right by a constitutionally appointed judicial organ has necessarily to depend upon the fulfillment of two conditions: firstly, its recognition by or under the Constitution as a right; and, secondly, possession of the vower of its enforcement by the judicial organs.
Article 226 of the Constitution is not meant for futile and unenforceable declarations of right.
The whole purpose of a writ of habeas corpus is to enforce a right to personal freedom after the declaration of the detention as illegal when it is so found upon investigation.
Enforceability of rights, whether.
they are constitutional or common law or statutory, in constitutionally prescribed ways by constitutionally appointed judicial organs is governed solely by the terms of the written instrument in n Constitution such as ours.
The scope for judicial law making on the subject of enforcement of the right to personal freedom was deliberately restricted by our Constitution makers.
It is difficult to see any such scope when enforcement itself is suspended.
[314 E F, 315 B C] What is suspended is really the procedure for the enforcement of a right through courts which could be said to flow from the infringement of a statutory procedure.
If the enforcement of a right to be free, resulting derivatively from both the constitutional and statutory provisions based on an infraction of the procedure.
which is statutory in cases of preventive detention, is suspended, it is impossible to lay down that it becomes enforceable when that part of the procedure which is mandatory is violated but remains unenforceable so long as the part of the procedure infringed is directory.
Such a view would introduce a ' distinction which is neither warranted by the language of Article 359 of the Constitution nor by that of the Presidential order of 1975.
[315 F G] 183 If the protection of enforceability is validly suspended for the duration of an Emergency, declared under constitutional provisions, the courts will have nothing before them to enforce so as to able to afford any relief to a person who comes with a grievance before them.
[329 G] A court cannot.
in exercise of any supposed inherent or implied or unspecified power, purport to enforce or, in substance enforce, a right the enforcement of which is suspended.
To permit such circumvention of the suspension is to authorise doing indirectly what law does not allow to be done directly.
[317 E F] [His Lordship felt that it was unnecessary to consider "any other purpose" in article 226 of the Constitution in view of the fact that each of detenus asked for a writ or habeas corpus and for no other kind of writs or orders.] The Constitution given unto themselves by the people, is legally supreme.
A notional surrender by the people of India of control over their several or individual rights to a Sovereign Republic by means of a legally supreme Constitution only means that the Constitution is supreme and can confer rights and powers.
One has to look to it alone and not outside it for finding out the manner in which and the limits subject to which individual citizens can exercise their separate freedoms.
A satisfactory explanation of the language of conferment used with reference to rights is that there has to be necessarily, as a result of such a process of Constitution making, a notional surrender of individual freedom so as to convert the possibility of "licence" to all, which ends in the exploitation and oppression of the many weak by the few strong into the actuality of a freedom for all regulated by law or under the law applicable to all.
[318 F H] Smt.
Indira Nehru Gandhi vs Raj Narain [1976] 2 SCR referred to.
Rules of natural justice, which are impliedly read into statutes from the nature of Functions imposed upon statutory authorities or bodies have sometimes been placed on the same footing as "Fundamental Rights of men which are directly and absolutely safeguarded" by written Constitutions.
The implied rules of natural justice do not override the express terms of a statute.
They are only implied because the functions which the statute imposes are presumed to be meant to be exercised in accordance with these rules, and therefore treated as though they were parts of enacted law.
The principles of natural justice which are so implied must always hang, if one may so put it on pegs of statutory provisions or necessarily flow from them and have no independent existence.
[319 G H, 320 A] State of Orissa vs Dr. Miss Binapani Dei & ors.
; , applied.
Fundamental Rights are basic aspects of rights selected from what may previously have been natural or common law rights.
These basic aspects of rights are elevated to a new level of importance by the Constitution.
Any other co extensive rights, outside the Constitution, are necessarily excluded by their recognition as or merger with Fundamental Rights.
[329 B] The object of making certain general aspects of rights fundamental is to guarantee them against illegal invasions of these rights by executive, legislative.
Or judicial organs (i e. Article 20) of the State.
This necessarily means that these safeguards can also be legally removed under appropriate constitutional or statutory provisions, although their suspension does not, by itself, take away the illegalities or their legal consequences.
The intention was to exclude all other control or to make the Constitution, the sole repository of ultimate control over those aspects of human freedom which are guaranteed in Part m. [319 A C & 329 C] Article 21 of the Constitution has to be interpreted comprehensively enough to include, together with article 19 practically all aspects of personal freedom.
It embraces both procedural and substantive rights.
Article 22 merely makes it clear that deprivations of liberty by means of laws regulating preventive detention would be included in "procedure established by law" and indicates what that procedure should be.
In that sense, it could be viewed as, sub 184 stantially, an elaboration of what is found in Article 21, although it also goes beyond it inasmuch as it imposes limits on ordinary legislative power.
[329 D E] Taken by itself, article 21 of the Constitution is primarily a protection against illegal deprivations by the executive action of the State 's agents or officials although, read with other Articles, it could operate also as a protection against unjustifiable legislative action purporting to authorise deprivations of personal freedom.
[329 F] Article 21 was only meant, on the face of it, to keep the exercise of executive power, in ordering deprivations of life or liberty, within the bounds of power prescribed by procedure established by legislation Article 21 furnishes the guarantee of "Lex", which is equated with statute law only, and not of "jus" or a judicial concept of what procedural law ought really to be.
The whole idea in using this expression was to exclude judicial interference with executive action in dealing with lives and liberties of citizens and others living in our country on any ground other than that it is contrary to procedure actually prescribed by law which meant only statute law.
According to well established canons of statutory construction, the express terms of "Lex" (assuming, of course, that the "Lex" is otherwise valid), prescribing procedure, will exclude "Jus" or judicial notions of "due process" or what the procedure.
Ought to be.
[321 H. 322 A C] A. K. Gopalan vs State of Madras ; referred to.
The suggestion that 'jus", which has been deliberately excluded from the purview of "procedure established by law", can be introduced by courts, through a back door, as though it was an independent right guaranteed by Chapter III or by any other part of the Constitution, cannot be acceded to.
[322 E F] R. C. Cooper vs Union of India ; , 578, distinguished.
Neither rights supposed to be recognised by some natural law nor those assumed to exist in some part of Common Law could serve as substitutes for those conferred by Part III of the Constitution.
They could not be, on any principle of law or justice or reason, virtually added to Part III as complete replacements for rights whose enforcement is suspended, and then be enforced, through constitutionally provided machinery, as the unseen appendages of the Constitution or as a separate group of rights outside the Constitution meant for the emergency which suspends but does not resuscitate in a new form certain rights.
[325 B D] His Holiness Kesavananda Bharati Sripadagalavaru vs State of Kerala [1973] Supp.
SCR @ 1.
Satish Chandra Chakraworti vs Ram Dayal De ILR P @ 407 410, 425 and 426: Waghela Rajsanji vs Sheikh Masludin and ors.
14 Indian Appeals p. 89 and Baboo Seo Thakur Dhobi vs Mst.
Subanshi w/o Mangal Dhobi, AIR 1942 Nagpur 99, referred to.
Not only all steps leading up to the deprivation of personal liberty but also the substantive right to personal freedom.
by implication, is covered by Article 21 of the Constitution.
[328 E F] 1.
C. Golaknath & ors.
vs Sate of Punjab and Another Even if article 21 is not the sole repository of all personal freedom, it will be clear, that all aspects of freedom of person are meant to be covered by Articles 19, 21, and 22 of the Constitution.
If the enforcement of these rights by Courts is suspended during the emergency, an inquiry by a court into the question whether any of them is violated by an illegal deprivation of it by executive authorities of the State seems futile.
[328 H, 329 A] A. K. Gopalan State of Madras ; and Kharak Singh vs State of UP & ors.
[1964] I SCR 332, applied.
The power to issue a writ is conferred upon courts exclusively by our Constitution All the powers of our courts flow from the Constitution which is the source of their jurisdiction.
If any provision of the constitution authorises the 185 suspension of the right to obtain relief in any type of cases, the power of courts is thereby curtailed even though a general jurisdiction to afford the relief in other cases may be there.
If they cannot issue writs of habeas corpus to enforce a right to personal freedom against executive authorities during tho emergency, the original nature of this writ issuing power comparable to a "prerogative" power cannot help the detenu.
[330 G H] It is a well recognised principle of law that whatever could be formerly even said to be governed by a common law prerogative power becomes merged in the Constitution as soon as the Constitution takes it over and regulates that subject.
[331 A] Principle in Attorney General vs De Keyser 's Royal Hotel Limited, ; @ 526 applied.
If there is no enforceable right either arising under the Constitution or otherwise, it is useless to appeal to any general power of the court to issue a writ of habeas corpus.
If the effect of suspension of the right to move the court for a writ of habeas corpus is that no inquiry can take place beyond finding out that the cause is one covered by the prohibitions mere possession of general power will not assist the detenu.
[331 C D] If the right to enforce personal freedom through a writ of habeas corpus is suspended, it cannot be said that the enforcement can be restored by resorting to "any other purpose".
That other purpose could not embrace defeating the effect of suspension of the enforcement of a constitutional guarantee and if held so would be making a mockery of the Constitution.
[331 D E] Nothing in the nature of a writ of habeas corpus or any power of a High Court under article 226 could come to the aid of a detenu when the right to enforce a claim to personal freedom, sought to be protected by the Constitution is suspended.
[331 E F] Provision for preventive detention in itself aptly described as "jurisdiction of suspicion" is a departure from ordinary norms, and resorted to either in times of war or of apprehended internal disorders and disturbances of a serious nature, with the object of preventing a greater dager to national security and integrity than any claim which could be based upon a right, moral or legal, to individual liberty.
[332 B C] Haradhan Saha & Anr.
vs The State of West Bengal and ors.
; ; Khudiram Das vs State of West Bengal [1975] 2 SCR p.832 @ p. 842; State of Madras vs V.G. Row AIR 1952 SC 197 @ 200 and Rex vs Halliday ; @ 275, referred to.
It is true that the Presidential order of 1975 like the Presidential order of 1962, does not suspend the general power of this Court under article 32 or the general powers of High Courts under article 226, bot the effect of taking away enforceability of the right of a detenu to personal freedom against executive authorities is to affect the locus standi in cases which are meant to be covered by the Presidential order.
Courts, even in habeas corpus proceedings, do not grant relief independent of the rights of the person deprived of liberty.
If the locus standi of a detenu is suspended, no one car.
claim to get his right enforced.
, [338 E F] If a case so patently gross and clear of a detention falling, on the face of the order of detention or the return made to a notice from the court, outside the provisions of the Act on the ground of personal malice of the detaining authority, or, some other ground utterly outside the Act, arises so that no further investigation is called for, it may be possible to contend that it is not protected by the Presidential order of June 27, 1975, and by the provisions of article 359(1) of the Constitution at all.
The mere presence of an official seal or signature on a detention order, in such a purely hypothetical case, may not be enough to convert it into a detention by the State or its agents or officers.
That is the almost utterly inconceivable situation or type of case which could still 186 be covered by the general power to issue writs of habeas corpus.
The remedy by way of a writ of habeas corpus is more general than relief against official action.
It lies even against illegal detentions by private persons although not under article 32 which is confined to enforcement of Fundamental Rights.
[339 A E] Shrimati Vidya Verma, though next friend R.V.S. Mandi vs Dr Shiv Narain Verma [1955] 2 SCR p. 983, referred to.
Courts must presume that executive authorities are acting in conformity with both the spirit and the substance of the law: The maxim "omnia praeswumuntur rite esse actus" means that all official acts are presumed to have been rightly and regularly done.
If the burden to displace that presumption is upon detenu, he cannot, in a habeas corpus petition under article 226 of the Constitution, ask the court to embark upon an inquiry, during the emergency, and allow him to lead evidence to rebut this presumption.
To do so would be plainly to countenance a violation of the Constitutional mandate suspending the procedure.
[340 A C] Eshughayi Eleko vs Officer Administering the Government of Nigeria & Anr.
@ 670; Liversidge vs Sir John Anderson and Anr.
[1942] A.C. p. 206 @ 217 and 219 and 273.
Rex vs Secretary of State of Home Affairs, Ex parte Lees and Green vs Secretary of State of Home Affairs, @ 293, discussed.
Decisions on what restraints should be put and on which persons during a national emergency, in the interests of national security, are matters of policy which are outside the sphere of judicial determination.
[344 G] Liversidge vs Sir John Anderson ; and Rex vs Halliday Ex Parte Zadiq ; , referred to.
Under our Constitution, there is no distinction between the effects of a declaration of emergency under article 352(1) whether the threat to the security of the State is from internal or external sources.
Presidential declarations under article 352(1) and 359(1) of ' our Constitution are immune from challenge in courts even when the emergency is over.
A noticeable feature of our Constitutions is that, whereas the consequences given in article 358 as a result of a Proclamation under article 352(1) are automatic, Presidential orders under Article 359(1) may have differing consequence, from emergency to emergency depending upon the terms of the Presidential orders involved.
And then, Article 359(1A) made operative retrospectively by the 38th Constitutional amendment of 1st August 1975, makes it clear that both the legislative and executive organs of the State are freed for the duration of the emergency from the limits imposed by Part III of the Constitution.
[348 A D] The striking differences in the terms of the two Presidential orders are: (1) The Presidential order of 1962 did not specify Article 14 of the Constitution, but article 14, guaranteeing equality before the law and equal protection of laws to all persons in India, is mentioned in the 1975 order.
This does make some difference between the intentions behind and effects of ' the two Presidential orders.
[352 B C] (ii) The President Order of 1962 expressly hedges the suspension of the specified Fundamental Rights with the condition, with regard to deprivations covered by Article 21 and 22 of the Constitution that the detenu should be deprived of his rights "under the Defence of India Act, 1962 or any rules or order made thereunder".
In other words.
On the terms of the 1962 Presidential Order, the courts were under a duty to see whether a deprivation satisfies these conditions or not.
They could adjudicate upon the question whether a detention was "under " the Act or a rule "made thereunder".
On the other hand, the Presidential order of 1975 unconditionally suspends the enforcement of the rights conferred upon "any person including a foreigner" to move any court for the enforcement of the rights conferred by Articles 14, 21 and 22 of the Constitution.
The Courts are.
therefore, no longer obliged or able to test the validity of a detention by examining whether they conform to statutory 187 requirements.
They will have to be content with compliance shown with forms of the law.
[352 C E] (iii) Presidential order of 1962 makes no mention of pending proceedings, but.
the 1975 order suspends all pending proceedings for the enforcement of the rights mentioned therein.
This further clarifies and emphasizes that the intention behind the Presidential order of 1975 was to actually affect the jurisdiction of courts in which proceedings were actually pending.
the inference from this feature also is that all similar proceedings in future will similarly be affected.
[352 E F] There can be no doubt whatsoever that the Presidential order of June 27, 1975, was a part of a unmistakably expressed intention to suspend the ordinary processes of law in those cases where persons complain of infringement of their fundamental rights by the executive authorities of the State.
The intention of the Parliament itself to bring about this result so that the jurisdiction of courts under article 226 in this particular type of cases is itself affected for the duration of the emergency, seems clear enough from the provisions of section 16A(9) of the Act, introduced by Act No. 14 of 1976, which received Presidential assent on January 25. 1976, making section 16A(9) operative retrospectively from June 25, 1975.
[352 F H] There is no doubt that the object of the Presidential (order of June '27, 1975, by suspending the enforcement of the specified rights, was to affect the powers of courts to afford relief to those the enforcement of whose rights was suspended.
This was within the purview of Article 359(1).
Hence objections that powers of the courts under.
article 226 may indirectly be affected is no answer to the direct suspension of rights which was bound to have its effect upon the manner in which jurisdiction is or could reasonably be exercised even if that jurisdiction cannot be itself suspended for all types of cases.
[353 A B] The term Rule of Law is hot a magic wand which can he waved to dispel every difficulty.
It is not an Aladin 's lamp which can be scratched to invoke a power which brings to any person in need whatever he or she may desire to have It can only mean what the law in a particular State or country is and what it enjoins.
This means that the Rule of Law must differ in shades of meaning and emphasis from time to time and country to country.
It could not be rigid, unchanging, and immutable like the proverbial laws of the Medes and Persians.
It cannot be like some brooding omnipotence in the skies.
Its meaning cannot be what anyone wants to make it.
It has to be, for each particular situation.
indicated by the courts as to what it means.
[353 F H, 354 A] The Rule of Law includes the concept of determination by courts, of the question whether an impugned executive action is within the bounds of law.
It pre supposes, firstly, the existence of a fixed or identifiable rule of law which the executive has to follow as distinguished from a purely policy decision open to it under the wide terms of the statute conferring a discretionary power to act.
and secondly the power of the courts to test the action by reference to the rule.
[354 E F] Even in emergencies provided the power of the court to so test the legality of some executive act is not curtailed, courts will apply the test ' of legality "if the person aggrieved brings the action in the competent court".
But, if the locus standi of the person to move the court is gone and the competence of the court to enquire into the grievance is also impaired by inability to peruse the ground of executive action or their relationship with the power to act, it is no use appalling to this particular concept of the Rule of Law.
It is just inapplicable to the situation which arises here.
Such a situation is governed by the emergency provisions of the Constitution.
[354 F H] Youngs Town Sheet & Tube Co. vs Sawyer, ; , 655 and Chief Settlement Commissioner, rehabilitation Department Punjab & Ors. etc.
vs Om Prakash & Ors.
; @ [354 F H] Whereas article 358, by its own force.
suspends the guarantees of article 19, Article 359(1) has the effect of suspending the operation of specified Funda 188 mental Rights.
If, however, the application of Articles 14, 19, 21 and 22 of the Constitution is suspended it is impossible to say that there is a Rule of Law found there which is available for the courts to apply during the emergency to test the legality of executive action.
[355 A C] Mohd. Yaqab etc.
vs The State of Jammu & Kashmir [1968] 2 SCR p. 227 @ 234, referred to.
The suggestion that a common law remedy by way of writ of habeas corpus exists, even after section 491 was introduced in the.
Criminal Procedure Code in 1923, is incorrect.
The sweep of article 359(1) of the Constitution taking in the jurisdiction of "any court" is wide enough to cover any kind of relief claimed by a petitioner for the enforcement of a specified Fundamental Right.
[355 D E] Pleas which involve any adduction of evidence would be entirely excluded by the combined effect of the terms of The Presidential order of June 27, 1975 read with the amended provisions of section 16A(9) of the Act.
In a case in which the officer purporting to detain had in fact, not been invested at all with any authority to act, the detention would be on the same footing as one by a private person who has no legal authority whatsoever to detain.
[357 C E] Makhan Singh vs State of Punjab [1964] 4 SCR 797 @ 821 822 and 5.
Pratap Singh vs State of Punjab ; , referred to.
The suspension of enforcement of specified Fundamental Rights operates only to protect infringements of rights by the State and its authorised agents, acting or purporting to act, in official capacities which they could and do hold.
A claim to an order of release from such a patently illegal detention, which is not by the State or on its behalf, could be enforced even during the current emergency.
[357 G] The presumption of validity of a duly authenticated order or an officer authorised to pass it is conclusive in habeas corpus proceedings during the current emergency.
By means of a differently phrased Presidential order of June 17, 1975 and the amendments in the Act, introducing rather drastic provisions of section 16A of the Act, the intention has been made clear that preventive detention should be a matter controlled exclusively by the executive departments of the State.
[358 B, 361 B C] State of Madhya Pradesh and Anr.
vs Thakur Bharat Singh ; State of Maharashtra vs Prabhakar Pandurang Sangzgiri and Anr. ; Dr. Ram Manohar Lohia vs State of Bihar and ors.
; ; K. Anandan Nembiar and Anr.
vs Chief Secretary, Government of Madras and ors.
; ; Durga Das Dhirali vs Union of India and ors ; Jai Lal vs State of West Bengal [1966] Supp.
SCR p. 4, 64, discussed and distinguished.
lt is very difficult to see the bearing of any such doctrine that the Rule of Law under our Constitution is embodied in the principle of Separation of Powers on a pure and simple question of determination of the meaning of constitutional and statutory provisions couched in words which leave few doubts unresolved.
[361 C D] If an order of preventive detention is not quasi judicial, as it cannot be because of the impossibility of applying any objective standards to the need for it in a particular case, there could be no question of violating any principle of Separation of Powers by placing preventive detention exclusively within the control of executive authorities of the State for the duration of the emergency.
[361 H. 352 A] Rai Sahib Ram Jawaya Kapur and ors.
vs The State of Punjab, , referred to.
Means of redress in cases such as those of mistaken identity or misapprehension of facts or of detenus due to false and malicous reports circulated by enemies are still open to detenu by approaching executive authorities.
There 189 is no bar against that.
What is hot possible is to secure a release by an order in habeas corpus proceedings after taking the courts behind a duly authenticated prima facie good return.
[366 B C] If the meaning of the emergency provisions in our Constitution and the provisions of ' the Act is clearly that what lies in the executive field should not be subjected to judicial scrutiny or judged by judicial standards of correctness the courts cannot arrogate unto themselves a power of judicial superintendence which they do not, under the law during the emergency, possess.
[362 H] It does not follow from a removal of the normal judicial superitendence even over questions of vires, of detention orders, which may require going into facts behind the returns that there is no Rule of Law during the emergency or that the principles of ultra vires are not to be applied at all by any authority except when, on the face of the return itself, it is demonstrated in a court of law that the detention does not even purport to be in exercise of the executive power or authority or is patently outside the law authorising detention The intention behind emergency provisions and of the Act is that although such, executive action as is not susceptible to judicial appraisement, should not be subjected to it, yet, it should be honestly supervised and controlled by the hierarchy of executive authorities themselves.
It enhances the powers and therefore, the responsibilities of the Executive.
[363 F H] In actual practice, the grounds supplied always operate as an objective test for determining the question whether a nexus could reasonably exist between the grounds given and the detention order or whether some infirmities had crept in.
The reasonableness of the detention because the justiciable issue because it related to the decision.
It is doubtful whether this could be said to be an object of preventive detention authorised by the Constitution and embodied in the Act.
[334 D E] The object of the amending Acts 39 of 1975 and 14 of 1976 was to affect the manner in which jurisdiction of courts in considering claims for reliefs by detenus oh petitions for writs of habeas courts was being exercised so that the only available means that has been developed for such cases by the courts, that is to say, the scrutiny of grounds supplied under section 8 of the Maintenance.
Of Internal Security Act may be removed from the judicial armoury, for the duration of emergency.
[336 C D] Prabhu Dayal Deorah etc.
vs District Magistrate Kamrup and ors.
; , referred to.
The contention that section 16A(9) affects the jurisdiction of High Courts under article 226 which an order under article 359(1) could not do, is untenable.
A Presidential Order which prevents a claim for the enforcement of a Fundamental Right from being advanced in a court, during the period of an emergency could possibly be said not to be intended to affect the exercise of jurisdiction of courts at all, is not correct.
[336 F G] That section 16A(9) amounts to a general legislative declaration in place of judicial decisions which courts had themselves to give after considering, on the facts of each case, whether article 226 could be applied, is also not acceptable.
the result of section 16A(9) to be valid would be to leave to the presumption of correctness of an order under section 3 of the Act untouched by any investigation relating to its correctness.
Now if this be the object and effect of The amendment, it could not be said to go beyond it to rebut a presumption of legality and validity or an order under section 3 of the Act, if prima facie case is made out.
[336 G H, 337 A] Observation [The same result could have been achieved by enacting that a detention order under section 3, prima facie good, will operate as "conclusive proof" that the requirements of section 3 have been fulfilled.
But, as the giving of grounds is not entirely dispensed with under the Act even as it now exists, this may have left the question in doubt, whether courts could call upon the detaining authorities 190 to produce the grounds.
Enactment of a rule of conclusive proof is a well established form of enactments determining substantive rights in the form of procedural provisions].
[337 A B] Section 16A(9) makes it impossible for courts to investigate questions relating to the existence or absence of bona fides at least in proceeding under An. 226, It is clear that the validity of section 16A(9) cannot be challenged on the ground, of any violation of Part III of ' the Constitution in view of the provisions of article 359(1)(A).
[353 C D] A challenge to the validity of section 16A(9) based either on the submission on hat grounds for detention do not call for secrecy or that the provision is an unwarranted invasion of judicial power, even in an emergency, is not well founded.
There is no such strict separation of power under our Constitution No particular provision of the Constitution could be pointed out in support of the proposition that preventive detention is a matter in which judicial superintendence must necessarily be preserved as a part of the doctrine of separation of powers.
[365 E F] Rai Sahib Ram Jawaya Kapur and ors vs State of Punjab , referred to.
Section 16A(9) imposes a bar which cannot be overcome in habeas corpus proceedings during the emergency.
In addition, a specific suspension or enforcement of the right of personal freedom against executive authorities places the presumption arising from a duly authenticated order of a legally authorised detaining officer on a higher footing than merely ordinary rebuttable presumption for purposes of proceedings under article 226 of the Constitution.
[367 F G] [His Lordship felt it unnecessary to consider the validity of section 16A(9) if it was to be applied at a time not covered by the emergency, or whether it should, be read down for the purposes of a suit for damages where the issue is whether the detention was ordered by a particular officer out of malice in, fact and for reasons completely outside the purview of the Act itself.
[337 C D] Section 16 of the Act seems to leave open a remedy by way of suit for Damages for wrongful imprisonment in a possible case of what may be called "malice in fact".
In the cases for habeas corpus, proceedings under article 226 of the Constitution where "malice in fact" could not be investigated.
as it is bound to be an allegation subsidiary to a claim for the enforcement of a right to personal liberty, a Fundamental Right which cannot be enforced during the Emergency.
[337 G H] Sree Mohan Chowdhury vs The Chief Commissioner, Union Territory of Tripura ; @ 450, followed.
Even the issue that the detention order is vitiated by "malice in fact ' will not be justifiable in habeas corpus proceedings during the emergency although it may be in an ordinary suit which is not filed for enforcing a Fundamental Right but for other reliefs.
The question of bona fides seems to be left open for decision by such suits on the language of section 16 of the Act itself.
[368 D E] In the case of preventive detention, placing the burden upon the executive authorities of proving the strict legality and correctness of every step in the procedure adopted in a case of deprivation of personal liberty, and asking the executive authorities to satisfy such a requirement, in accordance with what has been called the principle in Eschugbayi Eleko 's case; , @ 670, would be to nullify the effect of the suspension of the enforceability of the procedural protection to the right of Personal freedom.
To do so is really to take the Presidential order under Article 359(1) of the Constitution ineffective.
[368 B C] No question of "malice in law" can arise in habeas corpus proceedings when such a protection is suspended.
As regards the issue of "malico in fact" it cannot be tried at all in a habeas corpus proceedings although it may be possible to try it in a regular suit the object of which is not to enforce a right to personal freedom but only to obtain damages for a wrong done which is not 191 protected by the terms of section 16 of the Act.
The possibility of such a suit should be another deterrent against dishonest use of these powers by detaining officers.
[1368 D E] Section 18, though unnecessary, appears to have been added by way of abundant caution.
It cannot be assailed on the ground of violation of basic structure.
[342 F G] The theory of basic structure oil the Constitution cannot be used to build into the Constitution an imaginary part which may be in conflict with the constitutional provisions.
The Constitution cannot have a base out away from the superstructure.
Indeed, the emergency provisions could themselves be regarded as part of the basic structure of the Constitution.
[366 E F] The theory of basic structure of the constitution cannot be considered as anything more than a part of a well recognised mode of constructing a document The Constitution like any other document has to be read and constructed as a whole.
The theory was nothing more than a method of determining the intent behind the constitutional provisions it could not and did not build and add a new part to the Constitution.
It cannot imply new tests outside he Constitution or be used to defeat constitutional provisions.
[366 G, 367 A] His Holiness Kesavananda Bharati Sripadagalavaru vs State of Kerala, [1973] Supp SCR 1, applied.
There is no provision in our Constitution for a declaration of Martial Law except article 34 of the Constitution which recognises the possibility of Martial Law in this country.
There is no separate indication in the Constitution of conditions in which Martial Law could be "proclaimed".
A Presidential order under article 359(1) of the Constitution would, ordinarily, have a wider range and effect throughout the country than the existence of Martial Law in any particular part of the country.
The Presidential proclamations are meant generally to cover the country as a whole.
Martial Law is generally of a locally restricted application.
The conditions in which what is called "martial law" may prevail result in taking Military Courts of powers even to try offences: and, the ordinary or civil courts will not interfere with this special jurisdiction under extraordinary conditions.
Such a taking over by Military courts is certainly outside the provisions of Alt.
359(1) of the Constitution taken by itself.
It could perhaps fall under Presidential powers under Articles 53 and 73 read with article 355.
[368 F H. 369 A C] Judicial proceedings in criminal courts not meant for the enforcement of Fundamental Rights, are not either at the initial or appellate or revisional stages, covered by the Presidential order of 1975.
Habeas corpus petitions are not maintainable, in such cases since the prisoner is deemed to be in proper custody under orders of a court.
[371 F G] Neither Article 136 nor Art 226 of the Constitutional is meant for the exercise of an advisory jurisdiction.
Attempts to lay down the law in an abstract form, unrelated to the facts of particular cases, not only do not appertain to the kind of jurisdiction exercised by this Court or by the High Courts under the provisions of article 136 and 226 respectively, but may result in misapplications of the law declared by courts to situations for which they were not intended at all.
[306 D E].
Per Chandrachud, J. The order issued by the President on June 27, 1975, under Article 359(1) does not suspend the fundamental principle that all executive action must have the authority of law to support it.
Nor does the Presidential order give to the executive a charter to disobey the laws made by the Parliament which is the supreme law making authority.[413 B C] The aforesaid Presidential order, however, deprives a person of his locus stand; to move any court, be it the Supreme Court or the High Court, for enforcement of his Fundamental Rights which are mentioned in the order 192 Such deprivation or suspension enures during the period that the proclamation of emergency is in force or for such shorter period as may be specified in the order.
[413 C D] The dominant purpose of the present petitions is to obtain an order of release from detention by enforcing the right to personal liberty.
The purpose is not to obtain a mere declaration that the order of detention is ultra vires the Act under which it is passed.
The former plea is barred by reason of the Presidential order.
The latter is also barred because regard must be had to the substance of the matter and not to the form in which the relief is asked for.
[413 E F] The Presidential order dated June 27, 1975, bars any investigation or inquiry into the question whether the order of detention is vitiated by mala fides, factual or legal, or whether it is based on extraneous considerations or whether the detaining authority had reached his subjective satisfaction validly on proper and relevant material [413 F G] Whether or not article 21 of the Constitution is the sole repository of the right to personal liberty, in a petition filed in the High Court under article '226 for the release of a person detained under the , no relief by way of releasing the detenu can be granted because no person has a legal capacity to move any court to ask for such relief.
The Presidential order takes away such legal capacity by including article 21 within it.
The source of the right to personal liberty is immaterial because the words "conferred by" which occur in article 359(1) and in the Presidential order are not words of limitation.
[413 G H, 414 A] The Presidential order does not bring about any amendment of article 226 and is not open to challenge on that ground.
[414 B] The contention that article 226 which occurs in Chapter V, of the Constitution is an entrenched provision and, therefore, under article 368 no amendment can be made to article 226 without ratification by the Legislatures of not less than one half of the States is untenable.
It is true that article 226 is in entrenched provision which cannot suffer an amendment except by Following the procedure prescribed by the proviso to article 368(2).
But the presidential order is issued under the Constitution itself and if its true constitutional produces a certain results it cannot be said that some other Article of the Constitution stands thereby amended article 359(1) provides for the passing of an order by the President declaring that the right to move for the enforcement of Fundamental Rights mentioned.
in the order shall be suspended.
That may, in effect.
affect the jurisdiction of the High Courts to entertain a petition for the issuance of the writ of habeas corpus.
But, that does not bring about any amendment of Article 226 within the meaning of article 368, which speaks of amendments to the Constitution by the Parliament in the exercise of its constitutional power.
Article 226 and Article 359(1) are parts of the same fundamental instrument and a certain interpretation of one of these Article cannot amount to an amendment of the other.
1;385 G H, 386 A B] The Presidential order neither bars the right of an accused to defend his personal liberty in the court of first instance or in a higher court nor does it bar the execution of decrees passed against the Government, nor dos it bar the grant of relief other than or less than the release of the detenu from detention.
[414 B C] Detention without trial is a serious on personal freedom but it bears the sanction of our Constitution.
The "clear and present danger test" evolved by Justice Holmes in Schenck vs United States, may well be extended to cases where there is a threat of external aggression.
[384 D E] The object of Art 359 is to confer wider powers on the President than the power merely to suspend the right to file a petition for the writ of habeas corpus.
Article 359 aims at empowering the President to suspend the right to enforce all or any of the Fundamental Rights conferred be Part III.
It is in order to achieve that object that Article 359 does not provide that the President may declare that the remedy by way of habeas corpus shall be suspended during emergency.
Personal liberty is but one of the Fundamental Rights conferred by Part m and the writ of habeas corpus is neculiar to the enforcement of the 193 right to personal liberty and, therefore the suspension of the right to enforce the right conferred by article 21 means and implies the suspension of the right tc file a habeas corpus petition or to take any other proceeding to enforce the right to personal liberty conferred by Article 21.
[384 G H, 385 A B] The true implication of the Presidential order is to take away the right of any person to move any court for the enforcement of the rights mentioned in the order.
In strict legal theory the jurisdiction and powers of the Supreme Court and the High Courts remain the same as before since the Presidential order merely take away the locus standi of a person to move these courts for the enforcement of certain Fundamental Rights during the operations of the Proclamation of Emergency.
The drive of Article 359(1) is not against the courts but is against individuals, the object of the Article being to deprive the individual concerned of his normal right to move the Supreme Court or the High Court for the enforcement of the Fundamental Rights conferred by Part III of the Constitution [386 C E] Sree Mohan Chowdhury vs The Chief Commissioner, Union Territory of Tripura ; , 451, referred to.
The argument that the limited object of article 359(1) is to remove restrictions on the power of the Legislature so that during the operation of the Emergency it would be free to make laws in violation of the Fundamental Rights specified in the Presidential order loses sight of the distinction between the provisions of article 358 and article 359 (1A) on the one hand and of Art 359(1) on the other.
Article 358, of ' its own force, removes the restrictions on the power of the Legislature to make laws inconsistent with article 19 and on the power of the Executive to take action under a law which may thus violate article 19.
Article 358 does not suspend any right which was available under article 19 to any person prior to the Proclamation of Emergency.
Article 359(1) is wider in scope than article 358.
In view of the language of article 359(1) and considering the distinction between it and the provisions of article 358, there is no justification for restricting the operation of article 359(1) as against laws made by the Legislatures in violation of the Fundamental Rights.
[386 G H, 387 A E] Sree Mohan Choudhary vs The Chief Commissioner, Union Territory of Tripura ; and Makhan Singh vs State of Punjab [1964] 4 SCR 797.
referred to.
Article 359(1) is as much a basic feature of the Constitution as any other, and it would be inappropriate to hold that because in normal times the Constitution requires the Executive to obey the laws made by the Legislature, therefore.
Article 359(1) which is an emergency measure, must be construed consistently with that position.
The argument of basic feature is wrong for yet another reason that article 359(1) does 'not provide that the Executive is free to disobey the laws made by the Legislature.
To permit a challenge in a court of law to an order of detention, which is an Executive action, on the ground that the order violates ar Fundamental Right mentioned in the Presidential order, is to permit the detenu to enforce a Fundamental Right during emergency in manner plainly contrary to article 359(1).
[388 E H, 389 A] All executive action which operates to the prejudice of any person must have the authority of law to support it.
article 358 does not purport to invest the State with arbitrary authority to take action to the prejudice of citizens and other.
It provides that so long as the Proclamation of Emergency subsists laws may be enacted and executive action may be taken ill pursuance of such laws, which if the provisions of article 19 were operative would have been invalid.
Article 359(1) bars the enforcement of any Fundamental Right mentioned in the Presidential order, thereby rendering it incompetent for any person to complain of its violation, whether the violation is by the Legislature or by the Executive.
[389 H, 390 A, 391 E F] State of Madhya Pradesh and Anr.
vs Thakur Bharat Singh ; ; District Collector of Hyderabad & ors.
vs M/s. Ibrahim & Co. etc. ; Bennett Coleman & Co. and ors.
vs Union of India & ors.
[1973] 833SCI/76 194 2 SCR 757, 773, 775 and Shree Meenakshi Mills Ltd. vs Union of India, , 405, 406 and 428, distinguished.
The Rule of Law rejects the conception of the dual State in which governmental action is placed in a privileged position of immunity from control be.
Such a notion is foreign to our basic constitutional concepts.
[392 F] Chief Settlement Commissioner, Rehabilitation Department, Punjab and ors vs Om Parkash & ors. ; 660 661 and Eshugbayi Eleka vs Officer Administering the Government of Nigeria ; 670.
distinguished.
The Rule of Law argument like the "basic feature" argument is intractable.
Emergency provisions contained in Part XVIII of the Constitution which are designed to protect the security of the State are as important as any other provision.
Of the Constitution.
The Rule of Law during an emergency, is as one finds it in the provisions contained in Chapter XVIII of the Constitution.
There cannot be a brooding and omnipotent Rule of Law drowning in its effervescence the emergency provisions of the Constitution.
[393 B D] Article 359(1) neither compels nor condones the breaches by the executive of the laws made by the Legislature.
Such condonation is the function of an act of indemnity.
[393 G] The object of empowering the President to issue an order under Alt.
359(1) suspending the enforcement of the right to personal liberty conferred by Part III of the Constitution cannot be to save all other rights to personal liberty except the one conferred by Part III which seems totally devoid of meaning and purpose.
Their is nothing peculiar in the content of the right to personal liberty conferred by Part III so that the Constitution should provide only for the suspension of the right to enforce that particular kind of right leaving all other rights to personal liberty intact and untouched.
This purpose cannot ever be achieved by interpreting Article 359(1) to mean that every right to personal liberty shall be enforceable and every proceeding involving the enforcement of such right shall continue during the emergency except to the extent to which the right is conferred by Part III of the Constitution.
The existence of the right to personal liberty in the pre constitution period was surely known to the makers of the Constitution.
[395 H, 396 A D] The right to personal liberty is the right of the individual to personal freedom, nothing more and nothing less.
That right along with certain other rights was elevated to the status of a Fundamental Right in order that it may not be tinkered with and in order that a mere majority should not be able to trample over it Article 359(1) enables the President to suspend the enforcement even of the right which were sanctified by being lifted out of the common morass of human rights.
If the enforcement of the Fundamental Rights can be suspended during an emergency it is hard to accept that the right to enforce no Fundamental Rights relating to the same subject matter should remain alive.
[396 G H 397 A] The words "conferred by Part Ill ' which occur in article 359(1) are not intended to exclude or except from the purview of the Presidential Order rights of the same variety or kind as are mentioned in Part III but which were in existence prior to the Constitution or can be said to be in existence in the post Constitution era.
apart from the Constitution.
The words "conferred by Part III are used only in order to identify the particular rights the enforcement of which can be suspended by tho President and not in order to impose a limitation the power of the President so as to put those rights which exist or which existed apart from the constitution beyond the reach of that power.
It therefore does not make any difference whether any right to personal liberty was in existence prior to the enactment of the Constitution either by way of a natural right statutory right common law right or a right available under the law of port.
Whatever may be the source of the right and whatever may be its justification.
the right in essence and substance is the right to personal liberty.
That 195 right having been included in Part III, its enforcement will stand suspended if it is mentioned in the Presidential order issued under Article 359(1).
[397 E H 398 A C] The rights conferred by article 21 and 19 cannot be treated as mutually exclusive But the suspension of the right to enforce the right of personal liberty means the suspension of that right wherever it is found unless its content is totally different as from one Article to another.
The right conferred by Article 21 is only a description of the right of personal liberty in older to facilitate its exact identification and such a description cannot limit the operation of the Presidential order to those cases only where the right to personal liberty is claimed under Article 21.
[398 F G] Rustom Cavasajee Cooper vs Union of India ; , 578, referred to.
The circumstance that The pre constitution rights continued in force after the enchantment of the Constitution in view of article 372 does not make any difference to this position because even assuming that certain rights to personal liberty existed before the Constitution and continued thereafter as they were not repugnant to any provision of the Constitution all rights to personal liberty.
having the same content as the right conferred by article 21 would fall within the mischief to the Presidential order.
[398 C H, 399 A] The theory of eclipse has no application to such cases because that theory applies only when a pre Constitution law becomes devoid of legal force on the enactment of the Constitution by reason of its repugnancy to any provision of the Constitution.
Such laws are not void but they are under an eclipse so long as the repugnancy lasts.
When the repugnancy is removed the eclipse also is removed and the law becomes valid.
[399 A B] As regards the doctrine of merger, every prior right to personal liberty merged in the right to personal liberty conferred by Part III.
But whether it merged or not, it cannot survive the declaration of suspension if the true effect of the Presidential order is the suspension of the right to enforce all and every right to personal liberty.
In that view, it would also make no difference whether the right to personal liberty arises from a statute or from a contract or from a constitutional provision contained in some Part other than Part III.
[399 B C] Article 361(3) speaks of a process for the arrest or imprisonment of a Governor issuing from any court.
Fundamental Rights can be exercised as against judicial orders but the circumstances in which such a Process may come to be issued.
if at all, may conceivably affect the decision of the question whether a Presidential Order issued under Article 359(1) can bar the remedy of an aggrieved Governor.[400 B C] A failure to comply with Article 256 may attract serious consequences but no court is likely to entertain a grievance at the instance of a private party that article 256 has not been complied with by a State Government.
[400 D] [As regards the claim to personal liberty founded on a challenge to an order on the ground of excessive delegation His Lordship preferred to express no firm opinion though, the greater probability is that such a challenge may tail in face of a Presidential order of the kind which has. been passed in the instant case.
[400 D E] The existence of common law rights prior to the Constitution will not curtail the operation of the Presidential order by excepting.
those rights from the purview of the order.
[400 E] Dhirubha Devisingh Gohil vs The State of Bombay [1955] 1 SCR and Makhan Singh v State of Punjab [1964] 4 SCR 797, 818 819, applied.
The Presidential order dated June 27, 1975, does not contain any clause like the one in the order dated November 3, 1962 Article 359(1) is only an 196 enabling provision and the validity of a plea cannot be tested with reference to that Article.
The right to move a court for the enforcement of the rights conferred by Part III is not taken away by Article 359(1).
It is the Presidential order passed in pursuance of the powers conferred by that Article by which such a consequence can be brought about.
The Presidential order in the instant case is not subject to the preconditions that the detenu should have been deprived of his right under any particular Act and therefor, there is no scope for the enquiry whether the order is consistent or in conformity with any particular Act.
[405 B H, 406 A, 407 B C] Makhan Singh vs State of Punjab [1964] 4 SCR 797; Dr. Ram Manohar Lohia vs State of Bihar ; K. Anandan Nambiar and Anr.
vs Chief Security Government of Madras & ors.
; State of Maharashtra vs Prabhakar Pandurang Sangzgiri & Anr. ; , discussed and distinguished.
A mala fide exercise of power does not necessarily imply any moral turpitude and may only mean that the statutory power is exercised for purposes Other than those for which the power was intended by law to be exercise.
In view of the fact that an unconditional Presidential order of the present kind effects the locus standi of the petitioner to move any court for the enforcement of any of his Fundamental Rights mentioned in the order, it would not be open to him to show that the statutory power has been exercised for a purpose other than the one duly appointed under the law.
So long as the statutory prescription can be seen on the face of the order to have been complied with no further inquiry is permissible as to whether the order is vitiated by legal mala fides.
[409 E F] Makhan Singh vs State of Punjab [1964] 4 SCR 797; Jai Chand Lall Sethia vs State of West Bengal & ors.
[1966] Supp.
SCR 464 and Durgadas Shirali vs Union of India & ors.
; , referred to.
As regards mala fides in the sense of malice in fact, the same position must hold good because the Presidential order operates as a blanket ban on any and every judicial inquisition into the validity of the detention order.
If in any given ease an order of detention appears on the very face of it to be actuated by an ulterior motive, the court would have jurisdiction to set it aside because no judicial inquiry of any sort is required to be undertaken in such a case.
But, short of such ex facie vitiation, any challenge to a detention order on the around of actual mala fides is also excluded under the Presidential order dated June 27, 1975.
1407 G H, 408 A B] Section 16A(9) is not unconstitutional on the ground that it constitutions an encroachment on the writ jurisdiction of the High Court and article 226.
There is no warrant for reading down that section so as to allow the courts to inspect the relevant files, to the exclusion of all other parties.
[409 D, D] Section 16A (9) is in aid of the constitutional power conferred by article 359(1) and further effectuates the purpose of the Presidential order issued under that Article.
If so, it cannot be declared unconstitutional.
[410 A] The rule enunciated in section 16A(9) is a genuine rule of evidence.
[410 B] A. K. Gopalan vs State of Madras ; and Mohd. Maqbool Damnoo vs State of Jammu & Kashmir ; , distinguished.
The principles of res judicata and estoppel, the conclusive presumptions of law and various provisions of substantive law deny a free play to courts in the exercise of their jurisdiction.
These are not for that reason unconstitutional qua the High Court 's jurisdiction under article 226.
[410 F] The limits of judicial review have to be co extensive and commensurate with the right of an aggrieved person to complain of the invasion of his rights.
Section 16A(9) cannot be said to shut out an inquiry which is otherwise within the jurisdiction of the High Court to make.
[411 B] 197 Section 18 does not suffer from the vice of excessive delegation and is a valid piece of legislation.
[414 D] That section only declares what was the true position prior to its enactment on June 25, 1975.
The amendment of section 18 by the substitution of the words "in respect of whom an order is made or purported to be made under section 3", in place of the words "detained under this Act", does not render the section open to a challenge on the ground of excessive delegation.
The words "purported to be made" have been inserted in order to obviate the challenging that the detention is not in strict conformity with the Act.
Such a challenge is even otherwise barred under the Presidential order.
The object of he said provision is not to encourage the passing of lawless orders of detention but to protect during emergency orders which may happen lo be in less Than absolute conformity with the .
[412 B C] His Holiness Kesvananda Bharati Sripadagalarvaru vs State of Kerala [1973] Supp.
SCR I and Makhan Singh.
v State of Punjab [1964] 4 SCR 797 referred.
A jurisdiction of suspicion is not a forum for objectivity.
The only argument which the court can entertain is whether the authority which passed the order of detention is duly empowered to pass it, whether the detenu is properly identified and whether on the face of its order, the stated purpose of detention is within the terms of law.
[414 E F] Zamora 's case ; Rex vs Halliday ; , 271.
liversidge vs Sir John Anderson ; and Greene vs Secretary of State , referred to.
No judgment can be read as if it is a statute.
The generality of the expressions which may be found in a judgment are not intended to be expositions of the who 's law, but are governed and qualified by the particular facts of the case in which such expressions are to be found.
It is not a profitable task to extract a sentence here and there from a judgment and to build upon it because .
the essence of the decision is its ratio and not every observation found therein.
[401 C E] Quinn vs Leatham, ; , 506 auld State of Orissa vs Sudhansu Sekhar Misra & Ors.[1968] 2 SCR 154, 163, reiterated.
Per P. N. Bhagwati, J.
The Presidential order dated June 27, 1975, bars maintainability of a petition for a writ of habes corpus when an order of detention is challenged on the ground that it is vitiated by mala fides, legal, factual or is based on extraneous considerations or is not under the Act or is not in compliance with it.
[477 B C] The suspension of the privilege of the writ does not legalise what is done while it continues: it merely suspends for the time.
being the remedy of the writ.
[461 A B] The words "the right to move any court" are wide enough to include all claims made by citizens in any court of competent jurisdiction where it shown that the said claims cannot be effectively adjudicate upon.
without examining the question as to whether the citizen is, in substance, seeking to enforce any of the specified Fundamental Rights.
There can be no doubt that in view of the Presidential order which mentions article 21, the detenus would have no locus standi to maintain the writ petitions if it could be shown that the writ petitions were for the enforcement of the rights conferred by article 21.
[424 C E] Makhan Singh vs State of Punjab [1964] 4 SCR 797, followed.
When a Presidential order is issued under article 353, clause (1), the Fundamental Right mentioned in the Presidential order is suspended so that the restriction on the power of the executive or the legislature imposed by the Fundamental Right is lifted while the Presidential order is in operation and 198 the executive or the legislature is free to make any law or to make any action which it would, but for the provisions contained in Part 111, be competent to make or to take.
the words 'but for the provisions contained in that part" that is, but for the Fundamental Rights, mean "if the Fundamental Rights were not there in the Constitution, the executive being limited by law would still be unable to take any action to the prejudice of a person except by authority of law and in conformity with or in accordance with law and, therefore, even the Presidential order mentions article 21, clause (1A) of article 359 Would not enable the executive to deprive a person of his Personal liberty without sanction of law and except in conformity with or in accordance with law.
It ' an order or dentention is made by the executive without the authority of law it would be invalid and its invalidity would not be cured by clause (IA) or article 359 because that clause does not protect executive action taken without lawful authority.
An unlawful order of detention would not be protected from challenge under article 21 by reason of clause (IA) of article 359 and the detenu would be entitled to complain of such unlawful detention as being, in violation of ' article 21 except in so far as his right tor move the court for that purpose may be held to have been taken away by clause (1) of article 359.
[427 C H] State of Madhya Pradesh v Thakur Bharat Singh ; ; District Collector of Hyderabad vs M/s Ibrahim & Co. ; Bennett Coleman & Co. vs Union of India ; and Shree Meenakshi Mills Ltd. vs Union of India , applied.
Even though a Presidential Order issued under clause (1) of Art, 359 mentions article 21, where it is found that a detention has not been made in pursuance of lawful authority or in other words, the detention is without the authority of law, whether by reason of there being no law at all or by reason of the law under.
which the detention is made being void, clause (1A) of Art, 359 would not protect it from challenge under article 21 and it would be in conflict with that Article [429 H. 430 A] , The words "rights, conferred by Part III" cannot be read in isolation nor can they be construed by reference to theoretical or doctrinaire considerations.
'They must be read in the context of the provisions enacted in Part 111 in order.
to determine what are the rights conferred by the provisions in that Part, It is true that Art, 21 is couched in negative language.
It is not uncommon in legislative practice to use negative language for conferring a right.
That is often done for lending greater emphasis and strength to the legislative enactment.
Article 21 confers the Fundamental Right of personal liberty.
[430 F H] Punjab Province vs Daulat Singh 73 Indian Appeals 59; Basheshar Nath vs The Commissioner of Income Tax Delhi & Rajasthan [1959] Supp.
(1) SCR 529; State of Bihar vs Maharajidhiraj Kameshwar Singh of Derbhanga & Ors.
at p.988; P.D. Shamdasani vs Central Bank of India Ltd. ; AND R.C. Cooper vs Union of India ; referred to If article 21 were construed as not conferring a right to personal liberty, then there would be no Fundamental Right conferred by article 21 and even if a person is deprived of his personal liberty otherwise than in accordance with the procedure established by law and there is infringement of Art .21, such person would not be entitled to move the Supreme Court for a writ of habeas corpus under article 32, for that Article is available only for enforcement of the rights.
conferred by Part III.
That would be a starting consequence, as it would deprive the Supreme Court of a wholesome jurisdiction to protect the personal liberty of an individual against illegal detention, resulting in a departure from the well settled constructional position of article 21.
[432 B D] No attribute of personal liberty can be regarded as having been calved out of article 21.
That Article protects all attributes of persona; liberty against, executive action which is not supported by law.
When a person is detained.
there is deprivation of personal liberty within the meaning of article 21.
1433 A BI Kharak Singh vs State of U.P. & Ors.
[1964] 1 SCR 332.
referred to 199 The protection under article 21 is only against State action and not against private individuals and the protection, it secures, it is a limited one.
The only safeguard enacted by article 21 is that a person cannot be deprived of his persona liberty except according to procedure prescribed by "State made" law.
It is clear on plain natural construction of its language that article 21 imports two requirements: first, there must be a law authorising deprivation of personal liberty and secondly, such law must prescribe a procedure.
The first requirement is indeed implicit in the phrase "except according to procedure prescribed by law".
When a law prescribes a procedure for depriving a person of personal liberty, it must a fortiori authorise such deprivation.
Article 21, thus, provides both substantive as well as procedural safeguards.
Two other ingredients of article 21 are that there must not only be a law authorising deprivation of personal liberty there must also be a procedure prescribed by law or in other words law must prescribe a procedure.
[433 C F; 434 A C,H: 435 B] P. D. Shamdasani vs Central Bank of India Ltd. ; Smt.
Vidya Verma vs Dr. Shiv Narain and A. K. Gopalan vs State of Madras ; , followed.
Article 21, operates not merely as a restriction on executive action against deprivation of ' personal liberty without authority of law, but it also enacts d check on the legislature by insisting that the law, which authorises depravation, must establish a procedure.
What the procedure should be is not laid down in this Article, but there must be some procedure and at the least, it must conform to the minimal requirements of article 22.
"Law" within the meaning of article 21 must be a valid law and ' not only must it be within the legislative competence of the legislature enacting it, but it must also not be repugnant to any of the Fundamental Rights enumerated in Part III.
[435 C D] Shambhu Nath Sarkar vs The State of West Bengal ; ; and Khudiram Das vs The State of West Bengal & ors.
; , referred The constitutional principle in Eshugabayi E eko vs The officer Administrating the Government of Nigeria has been accepted by the courts in India as part of the law of the land.
In our country, even in pre Constitution days, the executive was a limited executive, that is, an executive limited by law and it could act only in accordance with law.
[438 B, 439 A] Liversidge vs Sit.
John Anderson , Vimlabai Deshpande vs Emperor AIR 1945 Nag. 8.
Jitenderanath Ghosh vs The Chief Secretary to the Government of Bengal, ILR at 377; In re: Banwarilal Roy 48 Cal.
Weekly Notes 766 at 780; Secretary of State for India vs Hari Bhanji Mad. 373; Province of Bombay vs Khushaldas Advani ; and P. K. Tare vs Emperor AIR 1943 Nag. 26, referred.
Even prior the Constitution, the principle of rule of law that the executive cannot act to the prejudice of a person without the authority of law was recognised as part of the law of the land and was uniformly administered by the courts.
It was, clearly "law" in force" and, ordinarily, by reason of article 372 it would have continued to subsist as a distinct and separate principle of law hr even after the commencement of the Constitution, until some aspects of ' this principle of Law were expressly recognised and given constitutional embodiment in different Articles of the Constitution.
[439 B C] When this principle of rule of law that the executive cannot deprive a person of his liberty except by authority of law, is recognised and embodied as a Fundamental light and enacted as such in article 21, it cannot continue to have a distinct and separate existence, independently and apart from this Article in which it has been given constitutional vesture, unless it were also enacted as a statutory principle by some positive law of the State.
It cannot continue in force under article 372 when it is expressly recognised and embodied as a Fundamental Right in article 21 and finds a place in the express provisions of the Constitution When the Constitution makers have clearly intended 200 that this right should be subject to the limitation imposed by article 359, clause (1) and (1A), it would be contrary to all canons of construction to hold that the same right continues to exist independently, but free from the limitation imposed by article 359, clauses (1) and (1A) Such a construction would defeat the object of the constitution makers in imposing the limitation under article 359, clauses (1) and (1A) and make a mockery of that limitation.
The Presidential order would in such a case become meaningless and ineffectual.
[439 F H, 440 A C] The only way in which meaning and effect can be given to the Presidential order suspending the enforcement of the right of personal liberty guaranteed under article 21 is that the principle of Rule of Law, on what the executive cannot interfere with the personal liberty of any person except by.
authority of law, is enacted in article 21 and it does not exist as a distinct and separate principle conferring a right of personal liberty independently and apart from that Article.
Consequently, when the enforcement of the right of personnel liberty conferred by article 21 is suspended by a Presidential order the detenu cannot circumvent the Presidential order and challenge the legality of his deletion by falling back on the supposed right of personal liberty based on the principle of Rule of Law.
[440F H] The executive is plainly and indubitably subordinated to the law and it cannot flout the mandate of the law but must act in accordance with the law.
[441 B] Eastern Trust Company vs Mckenzie Mann.
& Co. ; Rai Sahib Ram Jawaya Kapur vs The State of Punjab and State of Madhya Pradesh vs Thakur Bharat Singh ; referred to The Presidential orders issued under article 359 clause (1) do not give any power to the executive to alter or suspend or flout the law nor do they enlarge the power.
Of the executive so as to permit it to go beyond what is sanctioned by law.
As soon as the emergency comes to an end and the Presidential order ceases to be operative, the unlawful action of the executive becomes actionable and the citizen is entitled to challenge it by moving a court of law.
[161 A C] Whilst a Presidential Order issued under article 359, clause (1) is in operation, the Rule of Law is not obliterated and it continues to operate in all its vigour.
The executive is bound to observe and obey the law and it cannot ignore or disregard it.
If the executive commits a breach of the law its action would be unlawful but merely the remedy would be temporarily baned where it involves enforcement of any of the Fundamental Rights specified in the Presidential order.
[461 C D] When the right of personal liberty based on the Rule of Law which existed immediately prior to the Commencement of the Constitution has been enacted in the Constitution as a Fundamental Right in article 21 with the limitation that when there is a Proclamation of Emergency, the President may by order under article 359, clause (1) suspend its enforcement, that right of personal liberty based on the Rule of law cannot continue to exist as a distinct and independent right free from the limitation as to enforcement contained in article 359 clause (1).
It would be meaningless and futile for the Constitution makers to have imposed this limitation in regard to enforcement of the right of personal liberty guaranteed by article 21, if the detenu could with impunity, disregard such limitation and fall back on the right of personal liberty based on the Rule of Law.
[445 E G] Attorney General vs De Keyser 's Royal Hotel, ; , discussed.
Dhirubha Devisingh Gohil vs The State of Bombay [1955] I SCR 691, followed.
On an application of the maxim expressum facit cessare tacitum.
that is what is expressed makes what is silent cease a principle of logic and common 201 sense and not merely a technical rule of construction the express provision in article 21 that no person shall be deprived of his life or personal liberty except according to procedure prescribed by law will necessarily exclude a provision to the same effect to be gathered or implied from the other provisions of the Constitution.
[447 D E, 448 D] Shankara Rao Badami vs State of Mysore ; and State (Walsh and ors.) vs Lennon and ors.
1942 Irish Report.
of 112, applied.
The contention that the principle of Rule of Law that the executive cannot act to the prejudice of a person except by authority of law continues to exist as a distinct and independent Principle unaffected inter alia by the enactment of article 21, is not correct.
[451 Al State of Madhya Pradesh vs Thakur Bharat Singh [19671 2 SCR 454; District Collector, Hyderabad vs M/s. Ibrahim & Co. ; Bennet Coleman & Co. vs Union of India ; ; Shree Meenakshi Mills Ltd. vs Union of India & ors. ; Bidi Supply Co. vs Union of India ; ; Bishan Das & Ors.
v State of Punjab ; ; State of Bihar vs Kameshwar Prasad Verma ; ; Eshugbayi Eleko vs The officer Administering the Government of Nigeria AIR 1931 PC and Makhan Singh V. Sate of Punjab [1964] 4 SCR 797, distinguished.
The words 'any court in Article 21 must be given their plain grammatical meaning and must be construed to mean any court of competent jurisdiction which would include the Supreme Court and the High Courts before which the specified rights in article 359 clause ( 1 ) can be enforced by the citizens.[454 Al Makhan Singh V. State of Punjab , followed.
When the Presidential order is without any condition, in a detenu contends that the order of detention has been made mala fide or that it has been passed by a delegate outside the authority conformed on him under the Act or that it has been exercised inconsistently with the conditions prescribed in that behalf, that is, it is not in accordance with the Provisions of law, such a plea would be barred at the threshold by the Presidential order.
[458 B C] Quinn & Leathen ; , State of Orissa vs Sudhansu Sekhar Misra ; Makhan Singh Tarsikka vs 'The State of Punjab ; A. Nambiar vs Chief Secretary ; and Sate of Maharashtra vs Prabhakar Pandurang Sangzgiri ; , distinguished.
There is no scope for the contention that even if the enforcement of the Fundamental Right conferred by article 21 is suspended by the Presidential order, the detenu can still enforce a supposed natural right of personal liberty in a court of law.
[459 D] His Holiness Kesavananda Bharati Sripadagalavaru vs State of Kerala [1973] Supp.
SCR 1 and Golak Nath & Ors.
vs State of Punjab ; , referred to.
If the positive law of the State degrees that no person shall be deprived of his personal liberty except according to the procedure described by law, the enforcement of such statutory right would not be barred by the Presidential order.
But, there is no legislation in our country which confers the right of personal liberty by providing that there shall be no deprivation of it except in accordance with law.
(in the contrary, section 18 of the , enacts that no person in respect of whom an order of detention is made or purposed to be made under section 3 shall have any right to personal liberty by virtue of natural law or common law, if any.
h Because the Indian Penal Code in section 342 makes it penal to would fully confine any person and the offence of wrongful confinement postulates that no one shall be deprived of his personal liberty except by authority of law, it cannot 202 be said on that account that section 342 of the Indian Penal Code confers a right of personal liberty.
The utmost that can be said is that this section proceed on a recognition of the right of personal liberty enacted in article 21 and makes it an offence to wrongfully confine a person in breach of the right conferred by that constitutional provision [459 E H, 460 A] The words four any other purpose in article 226 greatly enlarge the jurisdiction of the High Court and the High Court can issue a writ of habeas corpus if it finals that the intention of a person is illegal.
It is not necessary for this purpose that the court should be moved by the detenu.
It is sufficient if it is moved by any person affected by the order of intention.
When it is so moved and it examines the legality of the order of detention it does not enforce the right of personal liberty of the detenu, but it merely keeps the executive within the bounds of law and enforces the principle of legality.
The words .
any other purpose cannot be availed of for the purpose of circumventing the constitutional inhibition flowing from the Presidential order.
[460 B G] Article 359 clause (1) and the Presidential order issued under it do not have the effect of making unlawful actions of the executive lawful.
[461 F G] When a person takes proceedings under the Code of Criminal Procedure in connection with the offence of wrongful confinement or murder or launches of prosecution for such offence, he cannot be said to be enforcing the fundamental Right of the detenu or the murdered man under article 21 so as to attract the inhibition of the Presidential order.
[461 F G] An application seeking to enforce a statutory obligation imposed on the police officer and a statutory right created in favour of an arrested person by section 57 of the Criminal Procedure Code would not be barred, because what is suspended by a Presidential Order specifying article 21 is the right to move the court for enforcement of the Fundamental Right conferred by that article and not the right to move the court for enforcement of the statutory right to be released granted under section 57, Cr.
P C. [462 G] If a positive legal right is conferred on a person by legislation and he seeks to enforce it in a court, it would not be within the inhibition of a Presidential Order issued under article 359, clause (1).
[463 G H] This does not mean that whenever a petition for a writ of habeas corpus comes before the court it must be rejected straightaway without even looking at the averments made in it.
The court would have to consider where the bar of the Presidential order is attracted and for that purpose the court would have to the whether the order of detention is one made by an authority empowered to pass such an order under the Act.
If it is not, it would not be State action.
and the petition would not be one for enforcement of the right confirmed by article 21.
[463 G H, 464 A] Once it is held that the obligation of the executive is not a deprive a person of his personal liberty except in accordance with law, is to be found only an article 21 and no where else it must follow necessarily that in challenging the legality of the detention, what the applicant claims is that there.
is, , in fact fact, by the executive of the right of personal liberty conferred by Art 21 and that immediately attracts the applicability of the Presidential order.
[460 D E] It is the basic characteristic and essence of martial law that during the time that it is in force, the individual cannot enforce his right to life and liberty by resorting to judicial process and the courts cannot issue the writ of habeas corpus or pass any suitable orders [442 G] John Allen 's case (1921) 2 Irish Reports 241, referred to: Merely by declaring martial law would not by itself deprive the courts of the power to issue the writ of habeas corpus or other process for the protection of the right of the individual to life and liberty.
[443 A] 203 The declaration of martial law, which is not even expressly provided in the Constitution, cannot override the provisions of the Articles conferring the right to life and liberty as also of Articles 32 an l 226 and unless the right of an individuals to move the courts for enforcement of the right to life and liberty can be suspended or taken away by or under an express provision of the Constitution, the individual would be entitled to enforce the right to life and liberty under article 32 or article 226 or by resorting to the ordinary process w. even during martial law.
[443 A C] Article 34 clearly postulates that during the time that material law is in force no judicial process can issue to examine the legality of an act done by the military authorities or the executive in connection with the maintenance of restoration or order.
[443 E F] During the martial law, the courts cannot and should not have the power to examine the legality of the action of the military authorities or the executive on any ground whatsoever, including, the ground of mala fides.
But, if the courts are to be prevented from exercising such power during, martial law the situation can be brought about only by a Presidential order issued under C. Act 359 clause (i) and in no other way, and the Presidential Order.
in so far as it suspends the enforcement of the right of personal liberty confirmed under article 21 must be constructed to bar challenge to the legality of detention in am, court including the Supreme Court and the High Courts whilst the Presidential Order is in operation, [444 A C] Ex parte Milligan (1866) 4 Wallace 2; Moyer vs Peabody , and Duncan vs Kohanmeku ; , referred to.
There are two rights which the detenu has in this connection: one is the Fundamental Right conferred by article 22, clause (5) and the other is the statutory right conferred by section 8.
Though the content of both these rights is the same, they have distinct and independent existence and merely because enforcement of one is suspended, it does not mean that the other also cannot be enforced.
[463 B C] The theory of reflection is clearly erroneous.
If the right conferred under section 8 were a reflection of the Fundamental Right conferred by article 22, clause (5) which is the object reflected must necessarily result in the effacement of the right under section 8 which is said to constitute the reflection.
But even if article 22 clause (5) were deleted from the Constitution, section 8 would still remain on the statute book until repealed by the legislature.
The Presidential Order would not therefore, bar enforcement of the right conferred by section 8.
[463 C D] Fathima Beebi vs M. K. Ravindranathan (1975) Crl.
1164, over ruled.
It is true that sub sec.
(9) (a) of section 16A does not specifically refer to any court.
But, there is inherent evidence in the sub section itself to show that it is intended to prevent disclosure of such grounds, information and materials before a court.
There is clearly an echo of section 123 of the Indian Evidence Act.
Sub section (9) of section It is must also be held to be designed to achieve the same intention as prohibiting disclosure even to a court.
Sub section (9) (a) of section 16A cannot, therefore, be read down so as to imply an exception in favour of disclosure to a court.
[469 D, F] Khudiram Das vs The State of West Bengal & Ors.
[1375] ` SCR 832; , Lee vs Burrel 170 English Reports 1402 and Liversidge vs Sir John Anderson ; referred to.
There can be no doubt that article 226 is a constitutional provision and it empowers the High Court to issue a writ of habeas corpus for enforcement of the Fundamental Right by article 21 and also for any other purpose.
The High Court has.
therefore, constitutional power to examine the Legality of detention and for that purpose to inquire and determine whether the detention is in accordance with the provisions of law.
The constitutional Power cannot be taken away or abridged by a legislative enactment.
If there is any legislative.
204 provision which obstructs or retards the exercise of this constitutional power it would be void.
It is, therefore, clear that if it can be shown that sub section (9) (a) of section 16A abridges or whitles down the constitutional power of the High Court under article 226 or obstructs or retards its exercise, it would be void as being in conflict with article 226.
If there is a legislative provision which prohibits disclosure of the grounds, information and materials on which the order of detention is based and prevents the court from calling for the production of such grounds, information and materials, it would obstruct and retard the exercise of the constitutional power of the High Court under article 226 and would be void as offending that Article.
[470 C D, 471 A B, E F] Hari Vishnu Kamath vs Syed Ahmad Ishaque & Ors. ; ; Durga Shankar Mehta vs Thakur Raghuraj Singh & Ors.
[1955] 1 SCR 267; Raj Krushna Bose vs Binod Kanungo & Ors.
; ; The Kerala Education Bill 1957, [1959] SCR 995; Prem Chand Garg vs Excise Commissioner, U.P. Allahabad [1963] Supp.
1 SCR 885; Khudiram Das vs State of West Bengal ; ; Biren Dutta & Ors.
v, Cheif Commissioner of Tripura & Anr.
; ; M.M. Damnoo vs J & K State ; and A.K. Gopalan vs State of.
Madras [1950] SCR p. 80, referred.
A rule of evidence merely determines what shall be regarded as relevant and admissible material or the purpose of enabling the court to come to a decision in the exercise of its jurisdiction and it does not in any way detract from or affect the jurisdiction of the court and it cannot, in the circumstances, be violative of article 226.
But in order that if should not fall foul of article 226, is must be a genuine rule of evidence.
If in the guise of enacting a rule of evidence the legislature in effect and substance disable and impedes the High Court from effectively exercising its constitutional power under article 226.
such an enactment would be void.
It will be colourable exercise of legislative power.
The legislature cannot be permitted to violate a constitutional provision by employing an indirect method.
It a legislative provision, though in form and outward appearance a rule of evidence, is in substances and reality something different obstructing or impeding the exercise .
The jurisdiction of the High Court under article 226, the form in which the legislative provision is clothed would not safe it from condemnation.
[474 B C] It is well settled that in order to determine the true character of a legislative provision.
the court must have regard to the substance of the provision and not its form.
Sub section (9)(a) of section 16A is in form and outward appearance a rules of evidence which says that the grounds, information and materials on which the order of detention is made or the declaration under sub section) or sub section (3) is based shall be treated as confidential and shall be deemed to refer to matters of State and be against the public interest to disclose.
Sub section
(9) (a) of section 16A assumes valid declaration under sub section
(2) or sub section
(3) and it is only when such a declaration has been made that sub section
(9)(a) of section 16A applies or in other words.
It is only in cases where a person is detained in order to deal effectively with the emergency.
that the disclosure of the grounds, information and materials is prohibited by sub sec.
(9)(a) of section 16A. [474 E F 475 B C, E F] The rule enacted in sub section
(9)(a) of section 16A bears close analogy to a rule of conclusive presumption and in the circumstance it must be regard as a genuine rule of evidence.
[476 D] If the grounds, information and materials have no relation to matter of State or they cannot possibly be of such a character that their closure would injure public interest, the legislature cannot, by merely employing a legal function, deem them to refer to matters of State which it would be against public interest to disclose an 1 thereby exclude them from the judicial ken.
That would not be a genuine rule of evidence: it would be a colourable legislative device a fraudulent exercise of power.
There can be no blanket ban on disclosure of the grounds, information and materials to the High Court of this Court irrespective of their true character in such cases [476 E F] 205 M. M. Damnoo vs State of J & K ; ; A. K. Gopalan vs State of Madras ; and Liversidge vs Sir John Anderson ; referred to.
The grounds, information and materials in almost all cases would be of a confidential character falling within the class of documents privileged under section 123 and hence the rule enacted in sub section genuinely partakes of the character of a rule of evidence.
Sub section
(9) (a) of section 16A enacts a genuine rule of evidence and it does not detract from or affect the jurisdiction of the High Court under article 225 and hence it cannot be successfully assailed as invalid.
[476 G H, 477 A] There is no warrant for reading down sub section 9A of section 16 so as to imply a favour in favour of disclosure to the court The provision does not constitute an encroachment on the constitutional jurisdiction or the High Court under article 226 and is accordingly not void.
[477, C D] If the declaration under sub section (2) or sub section
(3) is invalid, subs 9(a) of section 16A will not be attracted on the grounds of information and materials on which the order of detention is made, would not be privileged under sub section therefore, sub section 9(a) of section 16A enacts a genuine rule of evidence.
[477 A B] [His Lordship thought it unnecessary to go into the question of construction and validity of section 18 of the .] [464 A] An obiter cannot take the place of the ratio.
Judges are not oracles.
It has no binding effect and it cannot be regarded as conclusive on the point when considering the observations of a High judicial authority like this Court, the greatest possible care must be taken to relate the observations of a Judge to the precise issues before him and to confine such observations, even though expressed in broad terms, in the general compass of the question before him unless he makes it clear that he intended his remarks to have a wider ambit.
It is not possible for Judges always to express their judgments so as to exclude entirely the risk that in some subsequent case their language may be misapplied and any attempt at such perfection of expression can only lead to the opposite result of uncertainty and even obscurity as regard the case in hand.
[1455 F H, 456 A C] H. M. Maharajadhiraja Madhav Rao Jiwaji Rao Scindia Bahadur & Ors.
vs Union of India ; , applied Per H. R. Khanna, J. (dissenting) Article 21 cannot be considered to be the role repository of the right to life and personal liberty.
The right to life and personal liberty is the most decisions right of human beings in civilised societies governed by the rule of law.
H] Sanctity of life and liberty was not something new when the Constitution was drafted.
It represented a facet of higher values which mankind began to cherish in its, evolution from a state of tooth and claw to a civilized existence.
The principle that no one shall be deprived of his life and liberty without the authority of law was not the gift of the Constitution.
It was a necessary corollary of the concept relating to the sanctity of life and liberty, it existed and was in force before the coming into force of the Constitution.
[268 C D] Even in the absence of article 21 in the Constitution, the State has got no power to deprive a person of his life or liberty without the authority of law.
That is the essential postulate and basic assumption of the Rule of Law and not of men in all civilised nations.
Without such sanctity of life and liberty, the distinction between a Lawless society and one governed by laws would cease to have any meaning.
the principle that no one shall be deprived of his life or liberty without the authority of law is rooted in the consideration that life and liberty are priceless possessions which cannot be made the plaything of individual whim and caprice and that any act which has 206 the effect of tampering with life and liberty must receive substance from and sanction of the laws of the land.
Article 21 incorporates an essential aspect of that principle and makes it part of the Fundamental Rights guaranteed in part III of the Constitution.
It does not, however, follow from the above that if article 21 had not been drafted and inserted in Part III, in that even would have been permissible for the State to deprive a person of his life or liberty without the authority of law.
There are no case, to show that before the coming into force of the Constitution or in countries under Rule of Law where there is no provision corresponding to article 21, a claim was ever sustained by the court, that the State can deprive a person of his life or liberty without the authority of law.
[302 H, 269 H, 270 A C] Olmstead vs United States ; (1928); James Sommersett 's case (1772), 16 Cr.
Pract.
Fabrigas vs Mostyn ; Ameer Khan 's case 6 Bengal Law Reports 392.
Eshugbai Eleko vs Officer Administering the Government of Nigeria, ; Prabhakar Kesheo Tare & Ors.
vs Emperor AIR (1943) Nag. 26; Vimlabai Deshpande vs Emperor A.I.R. 1945 Nag. 8: Jitendranath Ghosh vs The Cheif Secretary to the Government of Bengal ILR ; In re: Banwari Lal Roy & Ors.
Bidi Supply Co. vs The Union of India & Ors. ; and Baheshar Nath vs The Commissioner of Income tax, Delhi & Rajasthan & Anr.
[1959] Supp.
(1) 528, referred to.
The view, that when right to enforce the right under article 21 is supplied the result would be that there would be no remedy against deprivation of a persons life or liberty by the State even though such deprivation is without the authority of law or even in flagrant violation of the provisions of law is hot acceptable.
the facts that the framers of the Constitution made an aspect of such right a part or the fundamental Rights did not have the effect of determining the independent identity of such right and of making article 21 to be the sole repository.
Of that right.
The real effect was to ensure that a law under which a per on can be deprived of his life or personal liberty should prescribe a procedure for such deprivation or such law should be a valid law not violation of Fundamental Rights guaranteed by Part III of the Constitution Recognition as Fundamental Right of one aspect of the pre constitutional right cannot have the effect of making things less favourable so far as the sanctity of life and personal liberty is concerned.
compared to the position if an aspect of such right had not been recognised as Fundamental Right because of The vulnerability of Fundamental Rights accruing from article 359.
1271 D G] A. K. Gopalan vs State of Madras ; and Dhirubha Devisingh Gohil vs The State of Bombay [1955] I SCR 691, referred to.
After the coming into force of the Constitution a detenu has two remedies one under article 226 or article 32 of the Constitution and another under section 491 of the Code of Criminal Procedure.
The remedy under an earlier statutory provision would not get obliterated because of the identical remedy by a subsequent Constitutional provision and that the two can co exist without losing their independent identity.
1272 D E] Makhan Singh vs State of Punjab [1964] 4 SCR 797, applied.
Dhirubha Devisingh Gohil vs The State of Bombay [1955] I SCR 691, not invokable.
The principle that no one shall be deprived of his life or liberty without the authority of law stems not merely from the basic assumption in every civilised society governed by the Rule of Law of the sanctity of life and liberty, it flows equally from, the fact that under our penal laws no one, is empowered to deprive a, person of his life or liberty without the authority of law [272 l I, 273 A] The fact that penal laws of India answer to the description of the word law which has been used in article 21 would not militate against the inference 207 that article 21 is not the sole repository of the right to life or personal liberty.
Nor is it the effect of article 21 that penal laws get merged in article 21 because of the act that they constitute law as mentioned in article 21, for were it so the suspension of the right to move a court for enforcement of Fundamental Right contained in article 21 would also result in suspension of the right to move any court for enforcement of penal laws.
At one time the Constitution came into force, the legal position was that no one could be deprived of his life or liberty without the authority of law.
[273 A C] Director of Rationing and Distribution vs 'The Corporation of Calcutta & ors.
; , relied on.
It is difficult to accede to the contention that because of article 21 of the Constitution, the law which was already in force that no One could be deprived of his life or liberty without the authority of law was obliterated and ceased to remain in force.
No rule of construction or interpretation warrants such an inference.
The constitutional recognition of the remedy of writ of habeas corpus did not obliterate or abrogate the statutory remedy of writ of habeas corpus.
Section 491.
Of the Code of Criminal Procedure continued to he a part of that Code till that Code was replaced by the new Code.
Although the remedy of writ of habeas corpus is not now available under.
the new Code of Criminal Procedure.
1973, the same remedy is still available under article 226 of the Constitution.
[273 H, 274 A Ci Makhan Singh vs State of Punjab [1964] 4 SCR 797, relied on.
According to the law in force in India before the coming into force of the Constitution, no one could be deprived of his life and personal liberty without the authority of law.
Such a claw continued to be in force after the coming into force of the Constitution in view of article 372 of the Constitution.
[303 The word law has been used in article 21 in the sense of State made law and not as an equivalent of law in the abstract or general sense embodying, the principles of natural justice.
The procedure established by law means the procedure established by law made by the State, that is to say, the Union Parliament or the legislatures of the States.
Law meant a valid and binding law under the provisions of the Constitution and not one infringing Fundamental Rights.
[266 C D] A, K. Gopalan vs State of Madras ; , explained.
The effect of the suspension of the right to move any court for the enforcement of the right conferred by article 21 is that when a petition is filed in a court, the court would have to proceed upon the basis that no reliance can be placed upon that Article for obtaining relief from the court during the period of emergency.
[266 D E] Starting consequences would follow from the acceptance of the contention that consequent upon the issue of the Presidential order in question, no one can seek relief from courts during the period of emergency against deprivation of life and personal liberty.
If two constructions of the Presidential order were possible, the court should lean in favour of a view which does not result in such consequence.
The construction which does not result in such consequences is not only possible, it is also pre eminently possible.
1303 B C] Equally well established is the`rule of construction that if there be a conflict between the municipal law on one side and the international law or the provisions of any treaty obligations on the other, the courts would give effect to municipal law.
however, two constructions of the municipal law are possible, The court should lean in favour of adopting such construction as would make the provisions of the municipal law to the in harmony with the international law or treaty obligations.
While dealing with the Presidential Order under article 359(1) such a construction should be a adopted.
as would, if possible, not bring it in conflict with the above Articles 8 and 9 of U.N Charter.
It is plain that such a constructional is not only possible, it is a also pre eminently 208 reasonable The Presidential orders therefore, should be so constructed as not to warrant arbitrary arrest or to bar right to an effective remedy by competent national tribunals for acts violating basic right of personal liberty granted by law.
1276 A B. 277 D E] Corocraft Ltd. vs Pan American Airways Inc ; Article 51 of` the Constitution, H. H. Kesavananda Bharati vs State of Kerala [1973] Supp.
SCR I, referred to.
The argument that suspending the right of a person to move any court for the enforcement of right to life and personal liberty is done under a constitutional provision and, therefore, it cannot be said that the resulting situation would mean the absence of the Rule of law.
cannot stand close scrutiny for it tries to equate illusion of the Rule of Law with the reality of Rule of Law.
A state of negation of Rule of Law would not cease to be such a slate because of the tact that such a state of negation of Rule of Law has been brought About by a statute.
Absence of Rule of Law would nevertheless be absence of Rule of Law even though it is brought about by a law to repeal all laws.
The Rule of Law requires something, more the legal principle "quod principi placuit legis habet vigorem." [277 E H, 278 A Bl Freedom under law is not absolute freedom.
It has its own limitations in its own interest, and can properly be described as regulated freedom.
The truth that every man ought to be free has for its other side the complementary and consequential truth that no man can be absolutely free.
The need of liberty for each is necessarily qualified and conditioned by the need of liberty for all Liberty in the State, or legal liberty.
is never the absolute liberty or all, but relative and regulated liberty.
Rule of law is true antithesis of arbitrariness.
The rule of law has come to be regarded as the mark of a free society.
Its content is different in different countries.
It is, however, identified with the liberty of 'he individual.
It seeks to maintain a balance between the opposing notions of individual liberty and Public order.
1267 C D; 268 B C] In a long chain of authorities the Supreme Court has laid stress upon the prevalence of the Rule of Law in the country, according to which the executive cannot take action prejudicial to the right of an individual without the authority of law.
There is no valid reason to depart from the rule laid down in those decisions.
1278 E. 281 E, 303 C D] Rai Sahib Ram Jawaya Kapur & Ors. vs The State of Punjab State of Madhya Pradesh & Anr.
vs Thakur Bharat Singh ; Chief Settlement Commissioner, Rehabilitation Department Punjab & Ors.
vs Om Parkash & Ors.
; ; District Collector of Hyderabad & Ors.
vs M/s. Ibrahim & Co. etc.
; Bennett Coleman & Co. and Ors.
vs Union of India ; Shree Meenaksi Mills Ltd. vs Union of India ; Naraindas Indurkhya vs The State of Madhya Pradesh ; Director of Rationing and Distribution vs The Corporation of Calcutta & Ors ; ; Bishan Das & Ors.
vs The State of Punjab & Ors. ; ; section G. Jaisinghani vs Union of India & Ors. ; United States vs Wunderlick ; ; John Wilkes 's case at 2539 and Smt.
Indira Nehru Gandhi vs Shri Rai Narain. , referred to.
According to article 21.
no one can be deprived of his right to personal liberty except in accordance with the procedure established by law.
Procedure for the exercise of power of depriving a person of his right of personal Liberty necessarily postulates the existence of the substantive power.
When article 21 is in force, law relating to deprivation of life and personal liberty must provide both for the substantive power as well as the procedure for the exercise of such power.
When right to move in court for enforcement of right guaranteed by Art 21 is suspended, it would have the effect of dispensing with the necessity of prescribing procedure for the exercise of substantive power to deprive a person of his life and personal liberty, it cannot have the effect of permitting an authority to deprive a person of his life or personal liberty without the existence of such substantive power.
[303 D F] 209 The difference in phraseology of the Presidential order dated June 27, 1975 and that of the earlier Presidential orders would not, however, justify the Conclusion that because of the new Presidential order dated rune 27, 1975, a detention order need not comply with the requirements of the law providing for preventive detention.
Such a detention order would still be liable to be challenged in a court on the ground that it does not comply with the requirement of law For preventive detention if ground for such challenge be permissible in spite of and consistently with the new Presidential order.
The effect of the change in phraseology would only be that such of the observation made by his Court fn the context of the language of the earlier Presidential orders cannot now be relied upon.
Reliance, however, can still be placed upon the observations made in various cases which were not linked with the phraseology of the earlier Presidential orders.
[263 F H] Makhan Singh vs Stare of Punjab [1964] 4 SCR 797; State of Maharashtra vs Prabhakar Pandurang Sangzgiri & Anr. ; and Dr. Ram Manohar Lohia vs State of Bihar & Ors. , referred to.
A Presidential order.
under article 359(1) can suspend during the period of emergency only the right to move any court for enforcement of the Fundamental Rights mentioned in the order.
Rights created by statutes being not Fundamental Rights can be enforced during the period of emergency despite the Presidential order.
Obligations and liabilities flowing from statutory provisions likewise remain unaffected by the Presidential order.
Any redress sought from a court of law on the score of breach of statutory provision would be outside the purview of article 359(1) and the Presidential order made thereunder.
1303 C Hl Anandan Nambiar & Anr.
vs Chief Secretary, Govt.
Of Madras ; @ 410, referred to.
Clause (1A) of article 359 protects laws and executive actions from any attack on validity on the score of being violation of the Fundamental Rights mentioned in the Presidential order in the same way as article 358 protect the laws and executive actions from being challenged on the ground of being violative of article 19 during the period of emergency.
The language of clause (IA) of It.
359 makes it clear that the protection which is afforded by that clause h is to such law or execute action as the State would but for the provisions contained in Part 111 of the Constitution be competent to make or take.
The word competent has a significance and it is apparent that despite the Presidential order under article 359(1) in the case of executive action the competence of the State to take such action would have to be established.
Such competence .
Would, however, be judged ignoring the restriction placed by the provisions or Part III of tho Constitution.
To put it in other words, clause (IA) of article 359 does not dispense with the necessity of competence to make laws.
Or take executive action.
But it would still be necessary to establish the competence de hors the restrictions of the Fundamental Rights.
[283 D E] Though, there is no reference to substantive power in article 21, it would cover both the existence of the substantive power of depriving a person of his life and personal liberty as well as the procedure for the exercise of that power [284 D] The suspension of the right to move a court for the enforcement of the right contained in article 21 cannot have the effect of debarring an aggrieved person from approaching the courts with the complaint regarding deprivation of life or personal liberty by an authority on the score that no power has been vested in the authority to deprive a person of life or liberty.
The pre supposition of the existence of substantive power to deprive a person of his life or personal liberty in article 21 even though that article only mentions the procedure, would not necessarily point to the conclusion that in the event of the suspension of the right to move any court for the enforcement of article 21, the suspension would also dispense with the necessity of the existence of the substantive power The co existence of substantive power and procedure established by law for depriving R person of his life and liberty which is implicit in article 21 would not lead to the result that even if there is suspension of the right regarding 16 833 SCI/76.
210 procedure, suspension would also operate upon the necessity of substantive power.
What is true of a proposition need not be true of the converse of that proposition.
The suspension of the right to make.
any court for the enforcement of the right contained in article 21 may have the effect of dispensing with the necessity of prescribing procedure for the exercise.
Of substantive power to deprive a person of his life or personal liberty, it can in no case have the effect of permitting an authority to deprive a person of his life or personal liberty without the existence of substantive power.
The close bond which is there between the existence of substantive power of depriving a Person of his life or personal liberty and the procedure for the exercise of that power, if the right contained in article 21 were in operation, would not necessarily hold good if that right were suspended because the removal of compulsion about the prescription of procedure for the exercise of the substantive power would not do away with the compulsion regarding the existence of that power.
[284 G H, 285 A G] In considering the effect of Presidential order suspending the right of a person tn move my court for enforcement of right guaranteed by Art, 21, the words "except according to procedure established by law should not be treated to be synonymous with save by authority of law .
[285 D] A Presidential order under article 359(1) cannot have the effect of suspending the right to enforce rights flowing from statutes, nor can it bar access to the courts of persons seeking redresses on he s ore of contravention of statutory provisions.
Statutory provisions are enacted to be complied with and it is not permissible to contravene them.
Statutory provisions cannot be treated as mere pious exhortations or words of advice which may be adjured or disobeyed with impunity.
Nor is compliance with statutory provisions optional or at the sufference of the official concerned.
It is the presence of legal sanctions which distinguished positive law from other systems of rules and norms.
To be a legal system a set of norms must furnish sanctions for some of its precepts.
A legal sanction is usually thought of as a harmful consequence to induce compliance with law.
Non complince with statutory provisions entails certain legal consequences.
The Presidential order cannot stand in the way of the courts giving effect to those consequences.
To put it differently, the executive authorities exercising power under a statute have to act in conformity with its provisions and within the limits set out therein.
When a statute deals with matters effecting prejudicially the rights of individuals, the ambit of the power of the authorities acting under the Statute would be circumscribed by its provisions and it would not the permissible to involve some indefinite general powers of the executive.
[286 D H] Attorney General vs De Keyser 's Royal Hotel Ltd. , Jaichand Lall Sethia vs State of West Bengal [1966] Supp.
SCR 464; Durgadas Shirali V. Union of India & ors. ; and G. Sadanandan vs State of Kerala .
& Anr. , referred to.
Article 226 under which the High Courts can issue writs of habeas corpus is an integral part of the Constitution.
No power has been conferred upon any authority in the Constitution for suspending the power of the High Court to issue writs in the nature of habeas corpus during the period of emergency.
Such a result cannot be brought about by putting some particular construction on the Presidential order in question.
[288 B, 304 A B] Greene vs Secretary of State for Home Affairs , Secretary of State for Home Affairs vs O 'Brien (609) and Rai Sahib Ram Jawaya Kapur & Ors.
vs The State of Punjab , referred to.
Article 226 of the Constitution confers power upon the High Courts of issuing appropriate writs in case it is found that the executive orders are not in conformity with the provisions of the Constitution and the laws of the land.
Judicial scrutiny of executive orders with a view to ensure that they are not violative of the provisions of the Constitution and the laws of the land being an integral part of our constitutional scheme.
it is not permissible to exclude judicial scrutiny except to the extent such exclusion is warranted by the provi 211 sions of the Constitution and the laws made in accordance with those provisions.
[290 F &] There is a clear demarcation of the spheres of function and power in our .`Constitution.
The acceptance of the contention advanced on behalf of the appellants would mean that during the period of emergency, the courts would be reduced to the position of being helpless spectators even if glaring and blatant instances of deprivation of Life and personal liberty in contravention of the statute are brought to their notice.
It would also mean that whatever it may be the law passed by the legislature, in the matter of life, and personal liberty of the citizens, the executive during the period of emergency would not be bound by it and would be at liberty to ignore and contravene it.
It is obvious that the acceptance of the contention would result in a kind of supremacy of the executive over the legislate and judicial organs of the State, and thus bring about a constitutional imbalance which perhaps was never in the contemplation of the framers of the Constitution.
The fact the the government which controls the executive has to enjoy the confidence so the legislator does not d tract from the above conclusion.
The executive under our constitutional scheme is nob merely to enjoy the confidence of the majority in the legislature it is also bound to carry out the legislative as manifested by the statutes passed by the legislature.
The Constitution further contemplated that the function of deciding whether the executive has acted in accordance with the legislative intent should be performed by the Courts.
[290 G H, 291 A C] No one can call deny the power of the State to assume vast powers of the detention in the interest of the security of the State.
It may indeed the necessary to do so to meet the peril acing the nation.
The consideration of security of the State must have a primacy and be kept in the forefront compared to which the interests of the individual can only take as secondary piece.
The motto has to be who lives, if the country dies.
Extraordinary powers are always assumed by the Government in all countries in times of emergency because of the extraordinary nature of the emergency.
The exercise of the power of detention.
it is well settled depends upon the subjective satisfaction of the detaining authority and the courts can neither act as courts of appeal over the decisions of the detaining authority nor can they substitute their own opinion for that of the authority regarding the necessity of detention.
There is no antithesis between the power of the State to detain a person without trial under a law or preventive detention and the power of the court to examine the legality of such detention.
Tn dealing with an application for a writ of habeas corpus, the courts only, ensure that the detaining authorities act in accordance with the law of preventive detention.
The impact upon the individual of the massive and comprehensive powers of preventive detention with which the administrative officers are armed l has to be cushioned with legal safeguarded. against arbitrary deprivation of personal liberty if the premises of the rule of law is not to lose its content and become meaningless.
The chances of an innocent person being detained under a law providing for preventive detention on the subjective satisfaction of an administrative authority are much greater compared on the possibility of an innocent person being convicted at trial in a court of law.
1291 F H, 292 A, D E] Rex vs Halliday Ex parte Sadiq ; @ 272 and Liversidge vs Sir John Anderson ; referred to 7 The Presidential order of June 27.
1975, did not aspect maintainability of the habeas corpus petitions to question the legality of the detention orders and such petitions could be proceeded with despite that order.
[293 F] Principle in James Commersett 's case 1772 State Trials p. 1, referred to.
A law of preventive detention is not punitive but precautionary and preventive.
The power of detention under such law is based on circumstance of suspicion and not on proof of allegation as is required at a regular trial for the commission of an offence.
[294 F] A court cannot go behind the truth of the alleged facts.
If The material is germane to the object for which detention is legally permissible and an 212 order.
for detention is made don the basis of that material, the courts cannot sit as a court of appeal and substitute their own opinion for that of the authority concerned regarding the necessity of detention.
[295 E F] Sharpe vs Wakefield at p. 179 and Ross vs Papadopollos (on P. 33), referred to.
Malice in fact is quite a different thing: it means an actual malicious intention on the part of the person who has done the wrongful act, and it May be, in proceedings based on wrongs independent or contract, a very material ingredient in the question of whether a valid cause of action can be stated.
[269 C D] Shearer vs Shields Bhut Nath vs State of West Bengal, ; , referred to.
In view of the Presidential Order suspending the right of the person to move any court for enforcement of specified Fundamental Rights including the one under article 22(5), it may with plausibility be argued that the vagueness of grounds of detention would not warrant the quashing of such detention order during the pendency of the Presidential order on the score of violation of article 22(5).
The Presidential order would.
however not stand in the way of the infirmity of the vagueness of grounds of detention because of the contravention of section X(l) of .
[297 E F] Every law providing for preventive detention contains certain procedural safeguards.
It is imperative that there should be strict compliance with the requirements of those procedural safeguards to sustain the validity of detention.
Detention without trial results in serious inroads into personal liberty of an individual.
In such case it is essential to ensure.
that there is no deviation from the procedural safeguards provided by the statute.
In the matter of even a criminal trial.
it is procedure that spells out much of the difference between the rule of law and the rule by whim and caprice.
The need for strict adherence to`strict procedural safeguards is much greater when we are dealing with preventive detention which postulates detention of a person even though he is not found guilty of the commission of an offence.
To condone or allow relaxation in the matter of compliance with procedural requirements would necessarily have the effect of practically doing away with even the slender safeguards is provide by the legislature against the arbitrary use of the provisions relating to prevention detention.
The history of personal Liberty is largely the history of insistence upon procedure.
It would.
therefore be wholly inappropriate to countenance and laxity in the mutter of strict compliance with procedural requirements prescribed for preventive detention.
[297 G H, 9`s A B] Once substantial disquieting doubt: are raised by the detenue in the mind of the court regarding the validity or his detention.
it would be the bounden duty of the State to dispel those doubts by placing sufficient material before the court with a view to satisfy it about the validity of the detention by filing a good return.
[299 C D] Kishori Mohan vs State of West Bengal AIR 1974 SC` 1749; king Emperor vs Sibnath Banerji 71 IA 241 and G. Sadanandan vs State of Kerala & Anr., , referred to.
[His Lordship did not express any opinion on the question of the validity of s 16A(9) of the .
[ 301 A] The appropriate occasion for the High Court to go into the constitutional validity of section 16A(9) and external all judicial scrutiny in writs of habeas corpus would be when the State or a detenu whoever is aggrieved upon, comes in appeal against the final judgments in any of the petitions pending in the High courts.
The whole matter would then be at large before the Supreme Court and it would not be inhibited by procedural or other constraints.
It would not be permissible or proper for the Supreme Court to short circuit the whole 213 thing and decide the matter by by passing the High Courts who are seized of the matter.
[302 F G and 304 D E] Section 18 of the would not detract from the view that article 21 is not the sole repository of the right to personal liberty.
The principle that no one shall be deprived of his life and personal liberty without the authority of law is also an essential facet of the Rule of law.
Section 18, therefore, cannot be of much assistance.
The view that section 18 would have the effect of enlarging the ambit of the power of the detaining authority for the purpose of passing an order for detention is not correct.
There has been no amendment of section 3 of the Act.
[274 D F] Section 18 cannot be construed to mean that even if an order for detention is made on grounds not warranted by section 3 of the Act, it shall be taken to be an order under section 3 of the Act.
Apart from the fact that such an inference is not permissible on the language of section 18, the acceptance of this view would also render the validity of section 18 open to question on the ground that it suffers from the vice of excessive delegation of legislative power.
The legislature is bound to lay down the legislative policy by prescribing the circumstances in which an order for detention can be made.
It is not permissible for the legislature to confer a power of detention without laying down guidelines and prescribing the circumstances in which such order should be made.
To do so would be tantamount to abdication of Legislation function for in such an event it would be open to the detaining authority to detain a person on any ground whatsoever.
[274 F H, 275 A] This Court in appeal by the State enlarge the area of the Unfavourable decision qua the state and make its position worse compared to what it was before the filing of the appeal.
Procedural propriety in matters relating to appeals forbids such a course.
The question of event of judicial scrutiny in the light of section 16A should be gone into when the whole matter is at large before this court and this court is not inhibited by procedural and other constraints from going into certain aspects which have a vital bearing.
It is primarily for the High Courts before which the matters are pending to decide the question of the of judicial scrutiny in the light of section 16A(9), as amended by Act.
14 of 1976.
A course which has the effect of bypassing the High Courts and making this Court in appeals from orders on preliminary objection to decide the matter even before the matter has been considered by the High Court in the light of section 16A(9), as, amended by Act 14 of 1976 should be avoided.
[301 F H] There is no sufficient ground to interfere with the view taken by all the nine High Courts which went into the matter that the Presidential order dated June 27, 1975, did not affect the maintainability of the habeas corpus petitions to question the legality of the detention orders.
[304 C] The principles which should be followed by the courts in dealing with petitions for writs of habeas corpus to challenge the legality of detention are well established.
1304 D] Unanimity obtained without sacrifice of conviction commends the decision to public confidence.
Unanimity which is merely formal and which is recorded at the expense of strong conflicting views is not desirable in a court of last resort.
[304 E] A dissent in a court of last resort is an appeal to the brooding spirit of the law, to the intelligence of a future day when a later decision may possibly correct the error into which the dissenting Judge believes the court have been betrayed.
[304 G] Prophets with Honor by Alan Barth 1974 Ed.
p. 3 6.
referred to.
Observation: Judges are not there simply to decide cases, but to decide them as they think they should be decided, and while it may be regrettable that they cannot always agree, it is better that their independence should be maintained and recognise than that unanimity should be secured through its sacrifice.
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<s>[INST] Summarize the judgementCivil Appeal No. 3952 of 1983 Appeal by Special leave from the Judgment and order dated the 6th October, 1982 of the Allahabad High Court in Civil Misc.
Writ Petition No. 7029 of 1981.
A.K. Sen and Pramod Swarup for the Appellants.
O.P. Malhotra and Mrs. S.Dikshit for Respondent No.2.
The Judgment of the Court was delivered by RANGANATH MISRA, J.
This appeal by special leave seeks to assail the decision of the Allahabad High Court in a proceeding under Article 226 of the Constitution refusing to quash an order of the IIIrd Additional District Judge, Kanpur, holding that Ceiling Appeal No. 189 of 1976 under the U.P. Imposition of Ceiling on Land Holdings Act, 1960, had abated for non substitution of the sole appellant 's legal representatives.
The ceiling appeal in question had been carried by one Rameshwar and during its pendency the sole appellant died on January 9, 1980.
Balram, Ram Bahadur and Jugal Kishore who are the three sons of Rameshwar moved the appellate Court for substitution of their names as legal representatives in place of Rameshwar 736 On October 25, 1980.
They applied for setting aside of abatement and condonation of delay.
The Additional Distt.
Judge took the view that there was no sufficient cause for condonation of delay and good reasons had not been shown for vacating abatement.
Accordingly the appeal was dismissed.
An application under article 226 was made before the Allahabad High Court for quashing of the appellate order.
It was contended that there was no period of limitation prescribed in respect of proceedings under the U.P. Imposition of Ceiling on Land Holdings Act, 1960 ( 'Act ' for short) for applying for substitution, nor was there any period prescribed in Rule 3 of Order XXII of the Code of Civil Procedure ( 'Code ' for short) which became applicable in view of section 38 of the Act.
Therefore, on the expiry of 90 days from the date of death of Rameshwar no abatement set in and the application for substitution made on October 25, 1980 could not have been rejected as being barred by limitation.
The High Court referred to section 38 (1) of the Act and to Rules 3, 9 and 11 of Order XXII of the Code and held that Article 120 of the First Schedule of the , was applicable and the petition for substitution should have been filed within 90 days from the date of death.
The writ application was, therefore, dismissed.
The decision of the Allahabad High Court is assailed before this Court.
When on the special leave petition notice was given it was indicated that the case would be disposed of on merits.
The respondents have, however, not appeared to contest.
Mr. Sen appearing in support of the appeal says that section 38 (1) of the Act makes it clear that the procedure in the Code has been made applicable for hearing and disposal of appeals.
Under section 42 of the Act, sections 4, 5 and 12 of the , have been made applicable to proceedings including appeals under the Act.
According to Mr. Sen, in view of the provisions in sections 38 and 42 of the Act the appellate authority and the High Court should have accepted the contention of the appellants that the Code was applied only for the disposal of appeals and the provisions of the excepting sections 4, 5 and 12 were not applicable to proceedings under the Act.
Section 38 (1) of the Act provides: "In hearing and deciding an appeal under this Act, the appellate court shall have all the powers and the privileges of a civil court and follow the procedure for the 737 hearing and disposal of appeals laid down in the Code of Civil Procedure, 1908".
Under the Code when death occurs at an appellate stage, substitution is effected in accordance with the procedure laid down in Order XXII.
In terms of sub section
(1) of section 38 of the Act, if death occurred of one of the parties at the appellate stage of a Ceiling Appeal, substitution had also to be made according to the procedure laid down in Order XXII of the Code.
Rule 3 of order XXII of the Code provides: "(1) where one of two or more plaintiffs dies and the right to sue does not survive to the surviving plaintiff or plaintiffs alone, or a sole plaintiff or sole surviving plaintiff dies and the right to sue survives, the Court, on an application made in that behalf, shall cause the legal representatives of the deceased plaintiff to be made a party and shall proceed with the suit".
Rule 11 of order XXII of the Code indicates that the provisions of that Order do apply to appeals.
There is another aspect which militates against Mr. Sen 's argument.
Sub rule (2) of rule 3 of that order provides: "where within the time limited by law no application is made under sub rule (1), the suit shall abate so far as the deceased plaintiff is concerned, and, on the application of the defendant, the Court may award to him the costs which he may have incurred in defending the suit, to be recovered from the estate of the deceased plaintiff".(Emphasis is added by us by underlining the words in the provision).
Obviously, time has been limited by law in Article 120 of the First Schedule of the to which we shall presently refer.
Article 120 of First Schedule of the provides that an application under the Code to have the legal representatives of the deceased appellant made a party has to be made within 90 days from the date of death of the appellant and Article 121 provides 60 days ' period for the application for an order to set aside abatement from the date of abatement.
It is not disputed that the application for substitution of the legal representatives of Rameshwar when made was beyond 150 days from the date of his death.
If the Code and the applied at the time when the application for substitution was made, the legal representatives had to ask for substitution, setting aside of abatement and condonation of delay in terms of rule 9 (3) of order XXII of the Code.
Whether there was sufficient cause for the delay to be condoned and for abatement 738 to be vacated were matters for the appellate court and Mr. Sen has rightly not canvassed before us that discretion which vested in the appellate court had not been properly exercised.
The sole ground pressed before us, as we have already stated, is as to whether to an appeal under the Act the provisions of the Code and the referred to above would apply.
There is little room to dispute that if Order XXII of the Code applies necessarily Articles 120 and 121 of the First Schedule of the would also apply.
The contention that only three sections of the have been specially extended to proceedings under the Act by section 42 thereof is of no consequence once it is held that order XXII of the Code is applicable to appeals under the Act.
Section 38 (1) of the Act in our view clearly extends the procedure applicable to appeals under the Code to appeals under the Act.
The extension of the procedure available under the Code to appeals under the Act attracts the entire procedure of the Code relevant for the purpose of disposing of an appeal under the Act.
There is no scope to reckon an exception unless the statute indicates any.
We are, therefore, not inclined to accept the submission advanced before us by Mr. Sen that the principles of abatement and delay were not applicable to the case in question and the appellate judge as also the High Court had gone wrong in applying the provisions of the Code and the to deal with the application for substitution.
The appeal fails and is dismissed without any direction for costs.
P.B.R. Appeal dismissed.
[/INST]The petitioner Bhagwant Singh a member of the Indian Revenue Service applied to the Court for intervention and necessary relief in the matter of the death of his married daughter Gurinder Kaur alleging that due to several circumstances he was convinced that his daughter was murdered in the house of her parent 's in law by burning her and that the police investigation was improper and irregular and ineffective.
According to the petitioner: (i) that he and his daughter were opposed to the evils of the dowry system and therefore, with a stipulation that no dowry should be demanded at the time of the marriage he gave his daughter to one Amarjit Singh, son of his colleague Kartar Singh Sawhney and a friend for over thirty years; (ii) that after the marriage his daughter came to be ill treated by her mother in law hinting that gifts and jewellery were expected from her parents and such oppressive tensions at home resulted in the mis carriage of a child, from which time onwards the mother in law taunted her saying that unless she observed the family tradition of presenting a necklace to her mother in law she would remain without a child; (iii) that sometime later, the son in law got it conveyed to Bhagwant Singh that he required Rs. 50,000 for financing his business which was not acceded to; (iv) that on August 9, 1980 i.e. ten months after the marriage his daughter was found dead of third degree burns from a kerosene fire in the bath room and was admitted in the Ram Manohar Lohia Hospital by her father in law at 12.15 P.M.; (v) that the police did not get the statement of his daughter recorded though she was able to speak; (vi) that the police added section 4 of the Dowry Prohibition Act to the charge on November 29, 1980 and only on May 15, 1981 a reference to section 306 IPC was included in the F.I.R.; and (vii) that the police failed to examine material witnesses and recover material objects and proceeded in a leisurely manner.
110 The Court admitted the writ petition and called for full details from the Inspector General of Police about the investigation of the case and the circumstances leading to the non filing of the report under section 173(2) of the Code of Criminal Procedure.
Disposing of the Writ Petition and directing the C.B.I. to complete the investigation within three months, the Court ^ HELD: 1:1 Disappointing as it may seem to those who have desired the institution of criminal action on the basis that a crime has been committed, the material on record does not, however, justify an order to that effect by the Supreme Court.
The investigation of the case now stands transferred to the C.B.I. at the instance of the petitioner.
[123 E F] 1:2.
It is not possible, in this case, nor indeed would it be right for the Court to do so, to enter into the question whether Gurinder Kaur committed suicide or was murdered.
That is a matter which is properly involved in the trial of a criminal charge by a court possessing jurisdiction.
[114 G H] 2:1.
The police did not display the promptitude and efficiency which the investigation of the case required.
There is much that calls for comment.
Though the CD entry made on August 9, 1980 indicates the visit of a sub inspector to the place of occurrence and seizure of several things, the blanket with which the fire is said to have been put out has not been seized.
On the next day when the experts from the Central Forensic Science Laboratory visited the place for getting any chance prints, the mirror was not taken possession of, nor was the report obtained for full five weeks.
In cases such as this, it would have been of the essence that on visiting the place of occurrence immediately on information of the incident, the mirror should have been taken into possession by the police and handed over forthwith to the Central Forensic Science Laboratory experts for an urgent report in regard to the existence and identification of the prints.
Delay in such a matter is vital and can often result in the loss of valuable clues.
Since Ramu the servant was reported to have helped in forcing open the door of the bathroom, he was a material witness for deposing whether the bathroom was latched from inside and had to be forced open or was in fact latched from outside.
It was only as late as January 25,1981, according to entry CD 13 of that date, that Ramu was examined by the Station House Officer.
Strangely he was allowed to leave the town and go to his village before he could be fully examined by the police.
There is no evidence that the police expressed any anxiety to put him through a thorough examination immediately or shortly after the date of the occurrence or at least before Shri Kartar Singh 's family allowed Ramu to leave the town for his village.
The fact that the investigation by the Delhi Police does not inspire confidence is clear from the memorandum dated May 12, 1981 issued by the Crime Branch to the Deputy Commissioner of Police to the effect that the statement of several material witnesses had not been recorded.
[118 B H, 119 A B, 120 B] 2:2 The investigation by the police following the occurrence was desultory and lackadaisical, and showed want of appreciation of the emergent need 111 to get at the truth of the case.
Whatever may be the reason, there is no doubt that the investigation of the case suffered from casualness, lack of incisiveness and unreasonable dilatoriness, and this is demonstrated most effectively by the manner in which the case was passed from one police official to another, being entrusted successively to sub Inspectors and Inspectors each of whom already had his hands full with the investigation of several other cases.
There is the admission that these police officers were not only preoccupied with numerous other cases in their hands but they were officers who were also required to look after the day to day work of the police station.
It was only when on the repeated and insistent petitions of Shri Bhagwant Singh the case passed into the control of the Crime Branch that the investigation showed some signs of speeding up.
Secondly, the haphazard maintenance of a police case diary not only does no credit to those responsible for maintaining it but defeats the very purpose for which it is required to be maintained.
It is of the utmost importance that the entries in a police Case Diary should be made with promptness, in sufficient detail, mentioning all significant facts, in careful chronological order and with complete objectivity.
[120 E H, 121 A.B] 2.3 In a case such as this, the death of a young wife must be attributed either to the commission of a crime or to the fact that.
mentally tortured by the suffocating circumstances surrounding her, she committed suicide.
Young woman of education, intelligence and character do not set fire to themselves unless provoked and compelled to that desperate step by the intolerance of their misery.
Such cases evidence a deep seated malady in our social order.
The greed for dowry, and indeed the dowry system as an institution, calls for the severest condemnation lt is evident that legislative measures such as the Dowry Prohibition Act have not met with the success for which they were designed.
Perhaps, legislation in itself cannot succeed in stamping out such an evil, and the solution must ultimately be found in the conscience and will or the social community and in its active expression through legal and constitution methods.
[121 C E] 3.
The Court suggested the following (i) Where the death in such cases is due to a crime, the perpetrators of the crime not infrequently escape from the nemesis of the law because of inadequate police investigation.
It would be of considerable assistance if an appropriately high priority was given to the expeditious investigation of such cases, if a special magisterial machinery was created for the purpose of the prompt investigation of such incidents, and efficient investigative techniques and procedures were adopted taking into account the peculiar features of such cases; [121 F G] (ii) A female police officer of sufficient rank and status in the police force should be associated with the investigation from its very inception.
There are evident advantages in that.
In a case where a wife dies in suspicious circumstances in her husband 's home its invariably a matter of considerable difficulty to ascertain the precise circumstances in which the incident occurred.
As the incident takes place in the home of the husband the material witnesses are 112 usually the husband and his parents or other relations of the husband staying with him.
Whether it was cooking at the kitchen stove which was responsible for the accident or, according to the inmates of the house, there was an inexplicable urge to suicide or whether indeed the young wife was the victim of a planned murder are matters closely involving the intimate knowledge of a woman 's daily existence.
[121 H, 122 A B] If the incident is the result of a crime by the husband or his family, the problem of ascertaining the truth is burdened by the privacy in which the incident occurred.
In the circumstances where it is possible to record the dying declaration of the victim, it would be more conducive to securing the truth if the victim made the declaration in the presence of a female police officer who can be expected to inspire confidence in the victim.
Psychological factors play their part, and their role cannot be ignored.
A young wife can be the subject of varying psychological pressures, and because that is so the nuances of feminine psychology support the need for including a female police officer as part or the investigating force; and [122 C E] (iii) The need to extend the application of the to other cities besides those where it operates already.
The application of the will make possible an immediate inquiry into the death of the victim, whether it has been caused by accident, homicide, suicide or suddenly by means unknown.
lt contains provisions which are entirely salutary for the purpose of such inquiry, and an inquiry under that enactment would be more meaningful and effective and complete than one under sections 174 and 175 of the Code of Criminal Procedure.
The procedure contemplated by the , ensures that the inquiry into the death is held by a person of independent standing and enjoying judicial powers, with a status and jurisdiction commensurate with the necessities of such cases and the assistance of an appropriate machinery.
[122 F H, 123 B C]
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<s>[INST] Summarize the judgementCivil Appeal No. 80 of 1977.
Appeal by Special Leave from the Judgment and order dated 4 11 1976 of the Punjab and Haryana High Court in Civil Rev. No. 226 of 1971.
Suresh Sethi (Amicus Curiae) for the Appellant.
Yogeshwar Prasad and Mrs. Rani Chhabra for the Respondent.
The Judgment of the Court was delivered by FAZAL ALI, J.
This appeal by special leave is directed against the judgment of the Punjab and Haryana High Court dated 4th November, 1976 dismissing the revision petition filed by the appellant before the High Court.
This case has rather a chequered career and travelled through various stages and finally when it came to the High Court the case was remanded and after remand another re vision petition was filed before the High Court which was heard by a Single Judge who referred it to a Division Bench as in his opinion a substantial question of law was involved in the case.
When the case went before the Division Bench consisting of Pandit and B. section Dhillon, JJ.
the two Judges differed from each other and the case was referred to a third Judge, namely, Mittal, J. who agreed with Pandit, J. and dismissed the petition.
Hence this appeal.
In order to understand the point of law involved in this case, it may be necessary to give a brief resume of the facts leading to the appeal.
It appears that the appellant defendant was a tenant of a shop belonging to one Sher Singh and was situated in Gurgaon Cantonment.
Sher Singh gave an application on 21 3 1967 under the provisions of the East Punjab Urban Rent Restriction Act 1949 (hereinafter referred to as the Act) against the defendant appellant for eviction from the shop on the ground that he had defaulted in payment of the rent and arrears for the period 9 11 1965 to 8 3 1967.
Notice of this application for 11th May 1967 was issued on the 22nd March, 1967 and was actually served on the defendant appellant on 22nd April, 1967.
on the 29th April, 1967 the defendant appellant made an application before the Senior Sub Judge who was also the Rent Controller for depositing a sum of Rs. 179.48 being the rent along with interest due.
The amount was however deposited before the Rent Controller on the 4th May, 1967.
It appears that the first date of the hearing of the 839 application was 11th May, 1967 on which date the Rent Controller made the following order: "Present: Mr. Vijay Pal Singh for the petitioner Mr. P. L. Kakkar for the respondent The respondent 's counsel Sh.
P. L. Kakkar has been informed that the petitioner has deposited Rs. 179.48 paise on 4 5 67.
Papers are filed.
" Even before this date when the amount was actually deposited by the appellant, the Rent Controller had passed the following order: "Present: Sh.
Shiv Narain Petitioner .
The rent be deposited at the responsibility of the petitioner and after that notice be issued on payment of P.F. for the respondent for 11 5 67.
" It is, therefore, manifest that in the instant case a deposit of the rent and the arrears along with interest had actually been made before the first date of hearing to the knowledge of the Court and the Court had acknowledged the fact of the deposit of the amount.
Again, on the first date of hearing i.e. 11th May, 1967 the Rent Controller informed counsel for the applicant respondent that a sum of Rs. 179.48 had been deposited.
It is, therefore, clear that the applicant respondent 1 ' was apprised clearly of the fact that the amount in question had actually been deposited and was at his disposal and he could withdraw the same from the Court of the Rent Controller whenever he liked.
Despite these facts, the Rent Controller held in its order dated the 2nd December, 1967 that the deposit was not made in accordance with the proviso to section 13(2) (i) of the Act, and, therefore, the appellant being a defaulter the application was allowed and ejectment was ordered.
Thereafter, the appellant went up in appeal to the District Judge who was the Appellate Authority under the Act which differed from the view taken by the Rent Controller and by his order dated 22nd February, 1968 having held that the deposit was valid dismissed the application filed by the respondent for evicting the appellant.
Thereafter a revision was filed to the High Court which was remanded to the District Judge for deciding the case afresh, and particularly having regard to the decision of this Court in the case of Shri Vidya Prachar Trust vs Pandit Basant Ram(l).
On remand the District Judge accepted the application of the respondent and affirmed the order of the Rent Controller directing ejectment of the appellant.
Thereafter the 840 appellant filed a revision before the High Court which, as already indicated, had a varied career before the High Court and was ultimately decided against the appellant and in favour of the applicant respondent The three Judges of the High Court who heard the case have been greatly influenced by the decision of this Court in Shri Vidya Prachar Trust case (supra).
It appears that the previous Division Bench of the Punjab and Haryana High Court in the case of Mehnga Singh & Ors.
vs Dewan Dilbagh Rai & ors had followed the Supreme Court decision and taken the view that the deposit in the circumstances was not valid.
We have gone through the judgment of the Judges of the High Court and we are unable to agree with the interpretation placed by them oh the proviso to section 13(2)(i) of the Act.
We are also constrained to observe that the High Court has misapplied the decision of this Court in Vidya Prachar Trust case (supra) which is clearly distinguishable from the facts and circumstances of this case.
Before dealing with the point of law involved it may be necessary to extract portions of the Act with which we are concerned.
In the instant case, we are mainly concerned with section 13 of the Act which may be extracted thus: "13.
(1) x x x (2) A landlord who seeks to evict his tenant shall apply to.
the Controller for a direction in that behalf.
If the Con troller, after giving the tenant a reasonable opportunity of showing cause against the applicant, is satisfied (i) that the tenant has not paid or tendered the rent due by him in respect of the building or rented land within fifteen days after the expiry of the time fixed in the .
agreement of tenancy with his landlord or in the absence of any such agreement, by the last day of the month next following that for which the rent is payable: Provided that if the tenant on the first hearing of the application for ejectment after the due service pays or tenders the arrears of rent and interest at six per cent per annum on such arrears together with the cost of application assessed by the Controller, the tenant shall be deemed to have duly paid or tendered the rent within the time aforesaid.
X X X X X 841 The Controller may make an order directing the tenant to put the landlord in possession of the building or rented land and if the Controller is not so satisfied he shall make an order rejecting the application.
" The decision of the case mainly turns upon the interpretation of the proviso to section 13, which requires three essential conditions: (1) that there must be an application for ejectment before the Court, (2) that even after due service the tenant does not pay or tender the arrears of rent and interest at 6 per cent per annum together with costs assessed by the Controller, (3) that if the payment as required by the aforesaid two conditions is made then the tenant shall be deemed to have paid rent within the time required by law.
The last part of section 13 enjoins that where the conditions of the proviso are not fulfilled the Controller shall make an order directing the tenant to put the landlord in possession and where he is satisfied that the rent has been paid, the application of the landlord must be rejected.
Thus, the sole question which has to be determined in the instant case is as to whether or not the deposit made by the appellant was legally valid.
The grounds on which the High Court held the deposit to b invalid were (1) that the rent was deposited in the Court of the Rent Controller without there being any express provision in the Act requiring the tenant to deposit the rent in Court, (2) that even if the deposit be held to be valid since it was made not on the date of the first hearing but before that date, the deposit did not conform to the conditions required in the proviso.
Thirdly, the High Court relied mainly on the decision of this Court in Vidya Prachar Trust case (supra) and held that the deposit was not valid.
Before examining the case of this Court in the case of Vidya Prachar Trust case (supra) it may be necessary to comment on the reasons given by the High Court in rejecting the case of the appellant.
We have already indicated above that tho appellant first moved the Rent Controller for making a deposit of Rs. 179.48 and then made the actual deposit on the 4th May, 1967 i.e. to say a week before the date of the first hearing fixed by the Rent Controller.
It is also not disputed before us or for that matter also, also before the courts below that the amount deposited by the appellant consisted of not only the arrears of rent but also costs and interest as required by the proviso to section 13 of the Act.
Fourthly, it is also established that after the deposit was made before the Rent Controller he did not return the same to the appellant on the ground that he had no jurisdiction to receive it but oh the other hand directed that notice of the deposit may be given to the respondent 842 for 11 5 1967.
Furthermore, the trial court on 11 5 1967 that is the first date of hearing recorded an order that the respondent 's counsel had been informed that the amount had been deposited.
There is magical formula or prescribed manner in which rent can be deposited by the tenant with the landlord.
The rent can be deposited by placing the money in the hands of the landlord which would amount to actual tender.
The second mode of payment is to deposit the amount in the court where a case is pending in such a manner so as to make the amount available to the landlord without any hitch or hindrance whenever he wants it.
Even the Act does not prescribe any particular mode of deposit.
In fact, the use of the words "tender or deposit" in the proviso clearly postulate that the rent can be given to the landlord in either of the two modes.
(1) It may be tendered to the landlord personally or to his authorised agent or it may be deposited in Court which is.
dealing with the case of the landlord to this knowledge so that the landlord may withdraw the deposit whenever he likes.
In the instant case the appellant tenant chose the second course.
How can it be said that a deposit before the Rent Controller where the case of the landlord was sub judice would not be a valid deposit if it was in fact in existence on the date of the first hearing to the knowledge of the landlord.
The reasoning of the High Court that the rent was deposited earlier than 11 S 1967 and is therefore, invalid does not appear to us at all.
In fact, if the tenant deposits the rent even before the first date of hearing it is a solid proof of his bonafides in the matter and the Legal position would be that if the rent is deposited before the first date of hearing, it will be deemed to have been deposited on the date of the hearing also because the deposit continues to remain in the court on that date and the position would be as if the tenant has deposited the rent in court for payment to the landlord.
This is ' more particularly so when the Controller gave notice to counsel for the respondent on the first date of hearing that the amount had been deposited with the Controller.
In these circumstances, we ar, satisfied that all the conditions necessary for the application of the proviso have been completely fulfilled in this case and the High Court was not at all justified in allowing the application of the landlord and directing ejectment of the appellant.
Coming now to the case of Vidya Prachar Trust case (supra) which is the sheet anchor of the judgment of the High Court we think that it is clearly distinguishable from the facts of this case.
In the first place, although in that case also an application under section 13 of the Act had been made by the applicant for the eviction of the respondent on the ground that rent was not paid, the tenant on the first date of hearing did not tender the rent, cost and interest as required 843 by the proviso but only a part of the rent.
It is, therefore, manifest A that in the case which was being dealt with by the Supreme Court the first condition enjoined by the proviso was not fulfilled at all and on that ground alone it could be held that the deposit was not valid.
Secondly, the deposit in that case was made not before the Rent Controller under the proviso to section 13 of the Act but was made before the Judge under section 31 of the Punjab Relief of Indebtedness Act which had absolutely no application to proceedings for eviction taken under the Act.
Thus, a deposit made before some other court had no nexus with the arrears of rent for which an application for ejectment was filed before the Rent Controller.
Thirdly, it was pointed out by this Court that the tenant had deposited even on. month 's rent in advance which under the provisions of section 19 read with section 6 of the Act was an offence if the landlord had withdrawn the rent.
Thus, the tenant in that case had deposited the rent in a manner and under circumstances under which it could not be made available to the landlord even if he wanted to withdraw it because the landlord may have entailed a criminal penalty.
These are the facts on the basis of which this Court held that the deposit was not valid.
In this connection this Court observed as follows: "There is only one saving for the tenant and that is when he tenders the full rent in Court before the Rent Controller together with interest and costs.
In the present case, the tenant did tender rent but only for a portion of the period and he relied on his deposit under the Relief of Indebtedness Act as due discharge of his liability for the earlier period.
It may be stated that the deposit before the Senior Sub Judge was made not only of arrears of rent but prospectively for some future period for which the rent was then not due.
" It appears from the observations of this Court extracted above that the deposit was prima facie invalid.
This Court further observed as follows: It is impossible to think that the landlords would be required to go to the Court of the Senior Sub Judge with a view to finding out whether their tenants have deposited rent due to them or not. on the whole, therefore, we are of opinion that the deposit under section 31 of the Relief of Indebtedness Act did not save the tenant from the consequences of the default as contemplated by section 13 of the Urban Rent Restriction Act.
" 844 The effect of this observation is that the deposit was made in a wrong court and under such circumstances that the deposit could not be available to the landlord whenever he wanted.
It was against the background of these special facts and circumstances that this Court in the Vidya Prachar Trust case (supra) held that the deposit was not valid.
In the instant case we find that the deposit made by the appellant does not suffer from any such infirmities as were present in Vidya Prachar Trust case (supra).
Finally, we would like to observe that the Rent Control Act is a piece of social legislation designed to protect the tenant from eviction by landlords on frivolous, insufficient or purely technical grounds.
Even as the Act allows eviction of the tenant on the ground of non payment of arrears of rent the proviso affords sufficient protection to the tenant against eviction if the tenant deposits the rent in accordance with the proviso.
Vidya Prachar Trust case (supra) was reconsidered by this Court in a recent decision in the case of Duli Chand vs Maman Chand by a Bench of three Hon 'ble Judges of which one of us (Kailasam, J.) was a party and while distinguishing the case this Court made the following observations: "We need not deal with all the contents that have been canvassed on both sides.
Nor do we feel the necessity of reconsidering the decision in Vidya Prachar Trust vs Basant Ram because on facts, the instant case is clearly distinguish able from that case.
Here, before us, the rent for the months of February, March and April 1964 was deposited by the tenant to the credit of the landlord in the very court of the Rent Controller in which the landlord subsequently filed the eviction petition.
The deposit lying in the Treasury was in the legal custody and control of the court of the Rent Controller, and at the first hearing, if not earlier, the landlord was informed that he was entitled to withdraw that deposit.
Thus, even if the tenant had obtained the order of the Rent Controller for making the deposit, by referring to section 31 of the Relief Act, the fact remained that the money was in custodia legis and could be ordered to be paid to the land lord there and then by the Court at the first hearing.
" It was further held by this Court that where the tenant makes the deposit of the arrears of rent and interest informing the landlord at the 845 first hearing then the requirement of the law has been sufficiently complied with.
In this connection, the Court observed thus: "The tenant by making deposit of the arrears of rent and interest and costs and informing the landlord at the first hearing that he could receive the same from the Court, had substantially complied with the requirement of the said.
proviso.
" In the instant case w, have already pointed out that the appellant had fulfilled all the conditions of the proviso and had deposited the rent arrears, costs and interest on the first date of hearing and he, therefore, complied with all the requirements of the proviso and was, therefore, entitled to the protection given by the statute.
In view of the legal opinion we have formed regarding the interpretation of proviso to section 13 of the Act it is manifest that the judgment of the High Court is legally erroneous and the case of Mehnga Singh (supra) is hereby overruled, as it had wrongly applied and misconstrued the decision of this Court in Vidya Prachar Trust case (supra).
For these reasons, therefore, we allow this appeal, set aside the judgment of the High Court and dismiss the application of the respondent for ejectment of the appellant.
In the peculiar facts and circumstances of this case the parties will pay and bear their own costs throughout.
S.R. Appeal allowed.
[/INST]The proviso to clause (1) of sub section (2) of section 13 of the East Punjab Urban Rent Restriction Act, 1949, states that "if the tenant on the first hearing of the application for ejectment after due service pays or tenders the arrears of rent and interest @ 65% per annum or such arrears together with the cost of application assessed by the Controller, the tenant shall be deemed to have duly paid or tendered the rent within the time showed in clause (i) of sub section (2) of section 13 of the Act, 1949".
In such circumstances, an order for eviction against the tenant cannot be passed.
The appellant was a tenant under the respondent landlord Sher Singh.
On 21 3 67, Sher Singh tiled an application under Section 13 of the East Punjab Urban Rent Restrictions Act, 1949 for ejectment of the appellant tenant from the tenanted shop situate in Gurgaon Cantonment, on the ground of arrears of rent for the period from 9 11 65 to 8 3 67 at the agreed rate @ Rs. 15/ pm.
The notice of the application for ejectment with the first date of hearing as 11 5 67 was served on the appellant tenant on 22 4 67.
On 29 4 1967 the appellant tenant made an application before the very same Rent Controller praying for payment of arrears of rent i.e. Rs. 178.48 for the above period computed @ Rs. 10.62 p.m., being the fair rent fixed by that Court on 20 4 67 in an earlier application for fixation of fair rent.
The said amount was actually deposited on the court of the Rent Controller on 4 5 67.
On 11 5 67 the appellant tenant tendered in the court to the landlord a further sum of Rs. 25/ being the costs and Rs. 2/ being the interest.
This was not accepted on the ground that the lender was not a valid one within the meaning of section 13(2)(i) of the Act.
This objection was accepted by the Rent Controller and an ejectment order was passed.
On first appeal the District Judge reversed the said order.
In the Revision before the High Court, the High Court remanded the matter to the first Appellate Court for fresh orders in view of this Court 's ruling in Vidya Prachar Trust vs Basant Ram [1970] 1 S.C.R. 66.
The First Appellate Court affirmed the ejectment order.
In the further revision to the High Court, the learned single Judge referred it to the Division Bench which in turn referred it to a third Judge.
The third Judge agreed with the single Judge that the payment of fair rent fixed on 4 5 67 was not a valid tender within the meaning of section 13(2)(i) of the Act.
The single Judge, therefore, dismissed the revision petition and confirmed the orders of ejectment of the courts below.
Allowing the appeal by special leave, the Court.
837 ^ HELD : 1.
Proviso to section 13(2)(i) of the East Punjab Urban Rent Restrictions Act, 1949 requires three essential conditions: (1) that there must be an application for ejectment before the Court, (2) that even after due service the tenant does not pay or tender the arrears of rent and interest at 6 per cent per annum together with costs assessed by the Controller, (3 ) that if the payment as required by the aforesaid two conditions is made then the tenant shall be deemed to have paid rent within the time required by law.
The last part of section 13 enjoins that where the conditions of the proviso are not fulfilled the Controller shall make an order directing the tenant to put the landlord in possession and where he is satisfied that the rent has been paid, the application of the Landlord must be rejected.
[841 A C] 2.
There is no magical formula or any prescribed manner in which rent can be deposited by the tenant with the landlord.
The rent can be deposited by placing the money in the hands of the landlord which could amount to actual tender.
The second mode of payment is to deposit the amount in the court where a case is pending in such a manner so as to make the amount available to the landlord without any hitch or hindrance whenever he wants it.
Even the Act does not prescribe any particular mode of deposit.
In fact, the use of the words "tender or deposit" in the proviso clearly postulate that the rent can be given to the landlord in either of the two modes.
(I) It may be tendered to the landlord personally or to his authorised agent or it may be deposited in Court which is dealing with the case of the landlord to his Knowledge so that the landlord may withdraw the deposit whenever he likes.
In the instant case the appellant tenant chose the second course.
[842 A C] 3.
A deposit before the Rent Controller where the case of the landlord was subjudice would be a valid deposit, if it was in fact in.
existence on the date of the first hearing to the knowledge of the landlord.
In fact, if the tenant deposits the rent even before the first date of hearing it is a solid proof of his bonafides in the matter and the legal position would be that if the lent is deposited before the first date of hearing, it will be deemed to have been deposited on the date of the hearing also because the deposit continues to remain in the court on that date and the position would be as if the tenant had deposited the rent in court for payment to the landlord.
[842 D E] In the instant case, all the conditions necessary for the application of the proviso have been completely fulfilled.
This is more particularly so when the Controller gave notice to the counsel for the respondent on the first date of hearing that the amount had been deposited with the Controller.
[842 E F] Vidya Prachar Trust vs Pandit Basant Ram, [1970] 1 S.C.R. explained and distinguished.
Dulichand vs Maman Chand, C.A. 1744/69 dated 27 3 79 followed Mehnga Singh & Ors.
vs Dewan Dilbagh Rai & Ors., overruled.
Observation: The Rent Control Act is a piece of social legislation designed to project the tenant from eviction by landlords on frivolous, insufficient or purely technical ground.
Even as the Act allows eviction of the tenant on the ground of 838 non payment of arrears of rent the proviso affords sufficient protection to the tenant against eviction if the tenant deposits the rent in accordance with the proviso.
[844 B C]
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<s>[INST] Summarize the judgementCivil Appeal No. 3527 of 1979.
Appeal by Special leave from the Judgment and order dated the 15th JaNuary, 1979 of the Karnataka High Court in Executive Second Appeal No. 89 of 1974.
Dr. Y.S. Chifale, R. B. Datar and Miss Madhu Mool Chandani for the Appellants.
section C. Javali, Ranjit KtJmar and B. P. Singh for the Respondent.
The Judgment of the Court was delivered by CHINNAPPA REDDY, J.
The respondent Dakshyani sued to recover a sum of RS.
7,324.86 paise from Narayana Swami, husband of the first appellant and father of the rest of the appellants.
The suit was decreed with costs and, in execution of the decree, certain property situated in Bangalore City was brought to sale.
The decree holder purchased the property at the execution sale held on August 19, 1969, for a sum of Rs. 28,000.
Narayana Swami having died in the meanwhile, his legal representatives, the present appellants, filed an application under the provisions of order 21 Rule 90 for setting aside the sale on various grounds.
The Executing Court dismissed the application on March 28, 1973 but on an appeal preferred by the appellants the sale was set aside on July 31, 1974.
The respondent filed a second appeal to the High Court of Karnataka.
At the hearing of the second appeal the parties entered into a compromise with the leave of the Court, such leave being necessary since mally of the present appellants were minors then 469 and are minors even now.
The Court granted leave and made an order in terms of the compromise.
The term of the compromise which we are concerned is that the present appellants agreed to deposit and the present respondent agreed to receive a sum of Rs. 60,000/ in full and final settlement of the decree.
If the deposit was made on or before November 30, 1976, the sale which though confirmed by the Trial Court but set aside by the Appellate Court was to stand set aside and the second appeal of the respondent was to stand dismissed.
If the amount of Rs. 60,000/ was not deposited on or before November 30, 1976 the second appeal was to stand allowed and the sale was to stand confirmed.
Time was stated to be the essence of the contract between the parties.
The applellants were permitted under the compromise, to raise funds by sale, mortgage etc.
Of the property in question.
The appellants failed to deposit the amount in terms of the compromise.
It appeaIs that they were unable to raise the necessary funds as they could not evict the tenant who was in occupation of the property.
Finally the appellants filed an application purporting to be under sections 148 and 151 of the Civil Procedure Code to extend the time for depositing the sum of Rs. 60,000 in terms of the compromise dated June 24, 1976.
The High Court dismissed the application on the ground that the Court could not extend time where time had been stipulated by the parties themselves in the compromise arrived at between them.
The High Court purported to rely upon the decision of this Court in Hukumchand vs Bansilal and Ors.(l) Shri R. B. Datar Learned Counsel for the appellants urged that there was no limitation on the power of the Court to extend time under section 148, c. P. c. and that where a compromise had been made an order of the Court, it was certainly open to the Court to extend time under section 148 c. P. c.
He relied upon the decision of the High Courts of Bombay and Calcutta in Marketing and Advertising Associates Pvt. Ltd. vs Telerad Pvt.
Ltd.(2) Jadabendra Nath Mishra vs Manorama Debya(3).
He distinguished the decision of this Court in Hukum Chand vs Bansilal.
Shri Javali Learned Counsel for the respondent, on the other hand urged that time should not be extended by the Court, 470 in law and on principle, where the parties themselves had agreed upon the time within which the amount was to be deposited.
In Hukamchand vs Bansilal the real question which was considered was, if a mortgaged property was sold in execution of a mortgage decree and if the application to set aside the sale under order 21 Rule 90 was dismissed but time was granted by consent of parties for depositing the decretal amount etc.
could time be extended for depositing the decretal amount etc.
to avert the confirmation of sale under order 34 Rule S, except with the consent of the parties.
The answer was 'no '.
Court said on the dismissal of an application under order 21 Rule 90, confir mation of sale under order 21 Rule 92 had to follow as a matter of course.
Order 34 Rule S merely permitted the deposit to be made at any time before confirmation of the sale and there could be no question of extending the time for such deposit.
If parties agreed to have the con firmation of sale postponed, further postponement would be possible by agreement of parties only.
The Court would have no say in the matter.
148 C. P. C. would have no application.
The position was clarified by the Court thus : "The judgment debtor mortgagor had the right to de posit the amount at any time before confirmation of sale within 30 days after the sale or even more than 30 days after the sale under order XXXIV, Rule (S) (l) so long as the sale was not confirmed.
If the amount had been deposited before the confirmation of sale, the judgment debtors had the right to ask for an order in terms of order XXXlV, Rule 5 (1) in their favour.
In this case an application under order XXI Rule 90 had been made and, therefore, the sale could not be confirmed immediately after 30 days which would be the normal course; the confirmation had to await the disposal of the application under order XXl, Rule 90.
That application was disposed of on October 7, 1958 and was dismissed.
It is obvious from the order sheet of October 7, 1958 that an oral compromise was arrived at between the parties in court on that day.
By that compromise time was granted to the respondents to deposit the entire amount due to the decree holder and the auction purchaser by November 471 21, 1958.
Obviously, the basis of the compromise was A that respondents withdrew their application, under order XXI, Rule 90 while the decree holder society and the auction purchaser appellant agreed that time might be given to deposit the amount upto November, 21,1958.
If this agreement had not been arrived at and if the application under order XXI, Rule 90 had been dismis sed (for example, on merits) on October 7, 1958, the court was bound under order XXI, Rule 92 (1) to confirm the sale at once.
But because of the compromise between the parties by which the respondents were given time upto November 21, 1958 the court rightly postponed the question of confirmation of sale till that date by consent of parties.
But the fact remains that the application under order XXI, Rule 90 had been dismissed on October 7, 1958 and thereafter, the court was bound to confirm the sale but for the compromise between the parties giving time upto November 21, 1958".
The Court then referred to the refusal of the Court to extend time by a fortnight on November 22, 1958 and further observed : "The executing court refused that holding that time upto Nov. 21, 1958 had been granted by consent and it was no longer open to it to extend that time.
The executing court has not referred to order XXI, Rule 92 in its order, but it is obvious that the executing court held that it could not grant time in the absence of an agreement between the parties because order XX[, Rule 92 required that as the application under order XXI, Rule 90 had been dismissed the sale must be confirmed.
We are of the view that in the circumstances it was not open to the executing court to extend time without consent of parties, for time between October 7, 1958 to November 21, 1958 was granted by consent of parties.
Section 148 of the Code of Civil Procedure would not apply in these circumstances, and the executing court was right in holding that it could not extend time.
Thereafter, it rightly confirmed the sale as required under order XXI, Rule 92 there being no question of the appli 472 cation of order XXXIV, Rule S for the money had not been deposited on November 22, 1958 before the order J of confirmation was passed.
Tn this view of the matter, we are of opinion that the order of the executing court refusing grant of time and confirming the sale was correct".
In the case before us, the situation Is totally different.
Unlike the case of Hukam Chand vs Bansilal where there was a statuory compulsion to confirm the sale on the dismissal OF the application under order XXI Rule 90 and, therefore, postponement and further postponement of the confirmation of the sale could only be by the consent of the parties in the case before us, there was no statutory compulsion to dismiss the application under order XXI, Rule 90 in the absence of an agreement between the parties.
The court would have then decided the appeal arising out of the application on the merits.
The parties, however, entered into a compromise and invited the court to make an order in terms of the compromise, which the court did.
The time for deposit stipulated by the parties became the time allowed by the court and this gave the court the jurisdiction to extend time in appropriate cases.
Of course, time would not be extended ordinarily, nor for the mere asking.
It would be granted in rare cases to prevent manifest injustice.
True the court would not rewrite a contract between the parties but the court would relieve against a forfeiture clause; And, where the contract of the parties has merged in the order of the court, the court 's freedom to act to further the ends of justice would surely not stand curtailed.
Nothing said in Hukamchand 's case militates against this view.
We are, therefore, of the view that the High Court was in error in; thinking that they had no power to extend time.
Even so, Shri Jawali submitted that this was not an appopriate case for granting any extension of time.
We desire to express no opinion on that question.
The High Court will decide that question.
We accordingly, set aside that judgment dated 15th January, 1979, of the High Court and direct the High Court to dispose of I. A. No. VIII in Execution Second Appeal No. 89/74 in accordance with law.
The parties will bear their own costs.
P.B.R. Appeal allowed.
[/INST]The respondent 's suit for the recovery of money from the first appellant 's husband was decreed and in the execution of the decree certain property of the appellant was brought to sale.
The decree holder purchased that property.
The appellant 's husband having died in the meanwhile his legal representatives filed an application under order XXI, Rule 90 of the C.P.C. for setting aside the sale.
That application was dismissed by the executing court.
On the appellant 's appeal, the sale was set aside.
At the stage of second appeal filed by the respondent the parties entered into a compromise with the leave of the court which after granting leave made an order in terms of the compromise.
Under a term of the compromise, the appellants agreed to deposit, and the respondent agreed to receive a sum of Rs. 60,000/ in full and final settlement of the decree.
It was also stated that if the deposit was not made on or before the stipulated date, the sale was to stand confirmed and the second appeal of the respondent was to stand.
Having found it difficult to deposit the money in terms of the compromise, the appellants filed an application under Ss. 148 and 151 of the C.P.C. praying that the time for depositing the money in terms of the compromise be extended.
The High Court dismissed this application on the ground that the Court could not extend time where time had been stipulated by the parties in the compromise arrived at between them.
In appeal to this Court it was contended on behalf of the appellants that where a compromise had been made the order of the Court, it was open to the Court to extend the time under section 148 C.P.C.
Allowing the appeal and remanding the case to the High Court to dispose of the execution second appeal afresh in accordance with the law. ^ HELD: As there was no statutory compulsion to dismiss the application under order XXI, Rule 90, C.P.C, in the absence of an agreement between the parties, the Court would have decided the appeal arising out of tho application 468 on the merits.
The parties in the instant case however entered into a compromise and invited the court to make an order in terms of the compromise, which the Court did.
The time for deposit stipulated by the parties became the time allowed by the Court and this gave the Court the jurisdiction to extend time in appropriate cases.
Time would not be extended ordinarily, nor for the mere asking but would be granted in rare cases to prevent manifest injustice.
Where the contract of the parties has merged in the order of the Court the Court 's freedom to act to further the ends of justice would not stand curtailed.
The High Court was in error in thinking that they had no power to extend time.
[472 B F] Hukumchand vs Bansilal and ors.
; , , held inapplicable.
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<s>[INST] Summarize the judgementiminal Appeal No. 171 of 1968.
479 Appeal by special leave from the judgment and order dated September 13, 1967 of the Calcutta High Court in Criminal Reference No. 36 of 1967.
D. N. Mukherjee, for the appellant.
The respondent did not appear.
The Judgment of the Court was delivered by Dua, J.
The appellant, Basudev Hazra, was a leaseholder in respect of tolls of the public ferry at Sadar Ghat on the outskirts of Burdwan town for crossing the river Damodar.
This lease was for a period of three years (August 14, 1963 to August 13, 1966) : exhibit 2.
On November 30, 1964 Matiar Rahman Mandal filed a complaint against the appellant in the court of the Sadar Sub Divisional Officer (Judicial), Burdwan alleging that the appellant used to realise illegally 20 nP. per cart from the cultivators who used to drive their carts across the dry bed of the river.
The matter was reported to the S.D.O. who directed an enquiry.
This infuriated the appellant.
On November 29, 1964 the appellant realised double the amount of toll and on protest and refusal by the complainant he was threatened with violence by the appellant.
The Magistrate trying the appellant for offences under sections 23 and 24 of the Bengal Ferries Act, I of 1885 convincted him of both the offences.
The appellant was sentenced to a fine of Rs. 10/ under section 23 and to fine of Rs. 20/ under section 24 : in default of payment of fine in the former case he was to undergo simple imprisonment for ten days and in the latter for 20 days.
On the appellant challenging his conviction on revision in the Court of the Sessions Judge, the Additional Sessions Judge, Burdwan made a reference to the High Court recommending the appellant 's acquittal.
It was observed by the Additional Sessions Judge in his reference that according to the appellant 's defence the complainant 's party were in fact using the landing stage and the path constructed and repaired by him and, therefore, they were liable to pay the usual toll tax.
After reproducing section 24 he added : ".
the complainant 's case as it appears from the petition of complaint and also from the evidence of the three witnesses examined on the point, is that they do not take advantage of any of the facilities provided by the lessee and that the lessee demanded toll from them even though they were using their own path.
The defence as I have already stated, was that the pathway and the landing stage belonged to the lessee and that, therefore, he was entitled to collect toll.
Forgetting the defence for the moment, it seems to me that no conviction 480 u/s 24 can be sustained on the case of the complainant as it is." According to him the collection of money from the people using their own pathway might amount to extortion but it would not attract section 24.
We need not refer to the recommendation with respect to the appellant 's conviction under section 23 as this was accepted by the High Court and there is no appeal against acquittal under that section.
The High Court accepted the recommendation with respect to the conviction under section 23 and acquitted the appellant of that offence.
In regard to the; conviction under section 24 the High Court observed that the trial Magistrate had found (i) that the appellant had been realising toll charges in excess of the scheduled rate of 20 ps.
per cart and also realising such charges from persons who did not use the ferry and (ii) that though the complainant had not availed of the ferry and: had taken the cart over the sandy bed of the river 40 ps.
per cart were realised from him.
These findings of fact were held not open to re examination on revision.
The High Court added that realisation of 40 ps.
fell within the mischief of section 24 which forbids every lessee from realising more than lawful toll even in cases in which he is entitled to demand ferry charges.
Repelling the argument that the present was a case of extortion and it did not fall within the purview of section 24 the High Court, after referring to the complainant 's case, observed that it was a case of illegal realisation of toll in excess, when the appellant was not entitled to realise it at all and not a case of extortion under the Indian Penal Code.
The amount had been illegally demanded as a toll and that also ' in excess of permissible rate.
The reference with respect to section 24 was, as observed earlier, rejected.
The appellant has secured special leave to appeal under article 136 of the Constitution and his counsel Mr. D. N. Mukherjee has strenously contended that the realisation of 40 ps.
per cart from those who do not use the ferry can not as a matter of law fall within the mischief of section 24 of the, Bengal Ferries Act.
His contention in essence is that unless someone actually uses a ferry no charges realised from him for permitting him to cross the river, even if the demand is made by way of toll, can attract the provisions of section 24.
The contention though prima facie somewhat attractive does not stand scrutiny.
Section 24 reads as under : "Penalty for taking unauthorised tolls, and for causing delay : Every such lessee or other person as aforesaid asking or taking more than the lawful toll, or without due cause 481 delaying any person, annual, vehicle or other thing, shall be punished with fine which may extend to one hundred rupees.
" It is obvious that this section does not speak of taking toll in excess of the lawful limit only from those persons who use the ferry.
This Act was enacted for regulating ferries but that does not mean that an illegal demand, under the pretext of claim by way of toll under this Act when it is not legally claimable was not intended by the legislature to be prohibited and made punishable by the language of section 24, Shri Mukherjee drew our attention to section 5 of the Act in which "ferry" is defined to include a bridge of boats, pontoons or rafts, a swing bridge, a flying bridge, a temporary bridge and a landing stage.
According to him, this definition suggests that it is only when a ferry is used and excessive, charges realised that section 24 would be attracted.
The submission is difficult to accept.
This definition which is not exhaustive does not seem to us to control or otherwise to throw helpful light in the interpretation of section 24.
This section seems to have been designed in effect to protect the persons crossing the river against harassment and abuse of the privileged position which the lessee or other person authorised to collect the tolls of a public ferry occupies under the statute in the matter of control over the passage or pathway for crossing, fording or ferrying across the river.
Demanding or re ceiving more than lawful dues and unduly delaying persons, animals, vehicles or things.
in crossing the river are both rendered penal and punishable.
Whether the person from whom the amount is demanded or received is under no obligation to pay anything by way of toll while crossing the river bed or is bound by law only to pay 20 ps.
per cart as toll would thus be immaterial when payment is demanded or received on the pretext that it is due as toll when it is legally not so due.
In either case section 24 would seem to be attracted : this construction would serve to suppress the mischief at which this section appears to be aimed.
The question whether or not the appellant 's case falls within the mischief of extortion as defined under the Indian Penal Code is not strictly relevant to the point arising in the controversy because if the appellant 's case is covered by section 24 of the Act then he is liable to be punished thereunder.
His liability to be prosecuted under the Indian Penal Code cannot by itself in law exclude the applicability of section 24 to his case.
The Additional Sessions Judge was, in our opinion, not quite right in observing that the defence that the accused was entitled to claim the toll may be ignored, because defence of an accused person can legitimately be taken into consideration while assessing the value of the evidence and judging the guilt or innocence of the accused.
The appellant 's defence in this case would clearly tend to support the complainant 's case that the amount received was demanded as toll which was an unlawful 482 ,demand.
To exclude cases like the present from the operation of section 24 would unduly restrict its effectiveness and would indeed facilitate illegal recoveries prohibited by it.
To that extent it would defeat the object and purpose which this section is intended to achieve.
When the appellant 's counsel took us through the evidence we found that the appellant had also delayed the prosecution witnesses without due cause in crossing the river in violation of section 24.
It is, however, unnecessary to pursue this aspect.
Finally it may be pointed out that article 136 of the Constitution does not confer a right of appeal on a party.
It only confers a discretionary power on this Court to be exercised sparingly to interfere in suitable cases where grave miscarriage of justice has resulted from illegality or from misapprehension or mistake in reading evidence or from ignoring, excluding or illegally admitting material evidence.
The present case suffers from no such infirmity.
The appeal accordingly fails and is dismissed.
R.K.P.S. Appeal dismissed.
[/INST]The respondent company appointed a managing director who was to retire at the age of 55.
The company arranged to provide a pension to him on retirement, or a pension to his widow if he died before attaining the age of 55.
It executed a trust deed on September 16, 1948, and paid to the trustees certain amounts to enable the trustees to take out an annuity policy to cover the pension.
On October 29, 1954, the company arranged to give enhanced pension to the director or his wife and set apart an ,additional sum on the same terms.
The director died in 1955 before attaining the age of 55, and the company claimed, in the return of its taxable income for the assessment year 1956 57, the total amount paid by it to the trustees as a permissible expenditure in the computation of the company 's business profits in the previous year.
The Appellate Tribunal, held; (i) that the setting apart of the funds amounted to expenditure Within the meaning of s.10(2)(xv), and (ii) that it amounted to revenue expenditure and not capital expenditure.
The Tribunal did not however consider whether the outgoing represented expen diture laid out or expended wholly and exclusively for the purpose of the business and whether it was authorised under s.10(4A).
The Tribunal referred to the High Court two questions, namely : (1) whether the amounts constituted expenditure during the relevant accounting year 1955 within the meaning of the section and (2) whether it represented a revenue expenditure.
The High Court held in favour of the company.
When the Department sought to urge the plea that before the section could be called in aid, it had also to be established that the expenditure was wholly and exclusively for the purpose of the business and that it was authorised by s.10(4A), the High Court did not permit the plea to be raised as it was not expressly raised before the Tribunal.
In appeal to this Court, HELD : (1) The amounts set apart became subject to the obligation to pay the pension arranged to be given, only when the director died, and since he died in May 1955, they must be deemed to have been expended only then, that is during the accounting year 1955.
[776 H; 777 A B] 774 Indian Molasses Co. (P) Ltd. vs Commissioner of Income tax, West Bengal, , referred to.
I I (2) An amount proved to be expended by a tax payer carrying on business is a permissible allowance under s.10(2) (iv) in the computation of the taxable income of the business if it is established; (i) that the allowance claimed is expenditure which, is not of the nature described in cls.
(i) to (xiv) of section 10(2); (ii) that it is not of the nature of capital expenditure or personal expenses of the assessee; (iii) that the expenditure was laid out or expended wholly and exclusively for the purposes of such business; and (iv) that it was authorised under section 10 (4A).
[778 C F] (3) The expression 'question of law arising out of such order ' in s.66(1), is not restricted to take in only those questions which have been expressly argued before and decided by the Tribunal.
If a question of law is raised before the Tribunal, even if an aspect of the question was not raised, that aspect may be urged before the High Court.
In the present case, the second question as framed and referred, does not exclude an enquirY whether the expenditure was wholly and exclusively laid out or expended for the purpose of the business of the company.
It cannot be held that, because before the Tribunal, stress was not pointedly laid upon the ingredients which enable an expenditure to be claimed and allowed, the question did not arise out of the order of the Tribunal.
Therefore the High Court was in error in refusing to allow the argument to be raised that the requirements of section 10(2) (xv) were not satisfied.
[779 H; 780 A; 781 B F] Commissioner of Income tax, Bombay vs Scindia Steam Navigation Co. Ltd. ; , explained and followed.
(4) Since the Tribunal gave no finding on that part of the case, a supplementary statement could be called from it, but such a supplementary statement would be restricted to the evidence on record and may result in injustice to the parties.
[781 F] New Jahangir Vakil Mills Ltd. vs Commissioner of Income tax, 'Bombay North, Kutch & Saurashtra, Petlad Turkey Red Dye Works Co. Ltd. vs Commissioner of Income tax and Keshav Mills Co. Ltd. vs Commissioner of Income tax, Bombay North.
Ahmedabad, , referred to.
(5) Therefore.
it is appropriate to decline to answer the second question on the ground that the Tribunal bad failed to consider and decide the question whether the expenditure was laid out or expended wholly and exclusively for the purpose of the business of the company and that it had not considered all appropriate statutory provisions.
and to leave it to the Tribunal to dispose of the appeal under section 66(5) of the Act [782 A C]
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<s>[INST] Summarize the judgementCivil Appeal Nos. 12 and 13 of 1977.
From the Judgement and order dated 17 11 1976 of the Andhra Pradesh High Court in Writ Appeal Nos.
591 592/76.
U. R. Lalit R. N. Sachthey and Girish Chandra for the Appellant in C. A. 12/77.
M. Abdul Khadar and G. Narayana Rao for the Appellant in C.A. 13/177.
T. section Krishna Murthy Iyer and A. Subba Rao for the Respondent.
The Judgment of the Court was delivered by FAZAL ALI, J.
These two appeals (one by the State of Andhra Pradesh and the other by the Union of India) by certificate are directed against a Division Bench Judgment of the Andhra Pradesh High Court dated 17 11 1977 confirming the decision of a Single Judge by which an order passed by the Central Government compulsorily retiring M. E. Reddy, respondent No. I (hereinafter referred to 740 as Reddy) from service in public interest was quashed in a writ petition filed before the High Court.
The facts of the case lie within a very narrow compass particularly in view of the fact that we have decided not to go into the question of malafide alleged against respondent No. 3, Mr. K. Brahmanand Reddy before the High Court because Reddy in a previous Writ filed in the High Court against the order of suspension had expressly withdrawn all the allegations against Mr. K. Brahmanand Reddy respondent No. 3 in the High Court.
We shall, however, touch the fringes of this question so far as it directly affects the order impugned passed by the Government of India.
Reddy started his career in the Police Service as Deputy Superintendent of Police in the year 1948.
In the year 1958 Reddy was appointed to the Indian Police Service and 1952 was the year of his allotment.
On 31 7 1958 Reddy was promoted as Superintendent of Police in the State of Andhra Pradesh and held charge of a number of Districts from time to time.
Reddy was also awarded the President Police Medal near about the 14th August, 1967, but the award of the President Police Medal was withheld as Reddy was placed under suspension by the Government on 11 8 1967 pending departmental enquiry into a number of allegations made against him.
It is not necessary for us to detail those allegations which are not germane for the purpose of deciding these appeals.
In 1969 Reddy filed a writ petition in the Andhra Pradesh High Court praying that the order of suspension passed against him dated 11 8 1967 may be quashed as it was passed on false allegations and at the instance of Mr. K. Brahmanand Reddy who was the Chief Minister of Andhra Pradesh at that time.
A large number of Limitations in support of the plea of malice were made by Reddy.
The writ petition was admitted by the High Court which passed an order dated 17 7 1969 staying all further proceedings including the written statement by Reddy to the six charges framed against him by the department.
When the writ came up for hearing before the single Judge, the State Government represented to the High Court that it had decided to withdraw the order of suspension and reinstate the respondent No. 1, Reddy.
The State Government accordingly withdrew the order of suspension and directed that the period of suspension may be treated as on duty.
Thereafter Reddy filed an application before the High Court seeking permission to withdraw the petition as also the allegations made in the petition against the Chief Minister respondent No. 3 in the High Court.
The High Court accepted the 741 prayer of Reddy and allowed the petition to be withdrawn and passed A the following order: "It seems that orders reinstating the petitioner and virtually cancelling the suspension order are being issued.
The learned Advocate for the petitioner therefore desires to withdraw the writ petition.
The writ petition is therefore dismissed as withdrawn".
As a result of these developments the departmental proceedings against Reddy were dropped and he was given Selection Grade which appears to have been withheld because of the order of suspension passed against Reddy.
On 27 4 1971 Reddy was given the Selection Grade with retrospective effect from 6 6 1969.
Thereafter by an order dated 28 4 1971 Reddy was promoted to the Rank of Deputy Inspector General of Police by the State Government.
It appears that during the course of the departmental enquiry the following entry appears to have been made in the Annual Confidential Report of Reddy: "He is under suspension.
Allegation against him is that he concocted a case against Venugopala Reddy (attempt to rape) to please the Inspector General of Police K. K. Nanmbiar.
There is also a strong suspicion about his integrity.
The Anti corruption Branch are enquiring into the allegations.
In this enquiry allegations are proved".
After the proceedings were dropped and Reddy was promoted as Deputy Inspector General of Police he made a representation to the Government that the adverse entry contained in the Annual Confidential Report may be expunged.
The Government of Andhra Pradesh after considering the representation of Reddy passed the following order dated 20 4 1974: "The Government, after careful consideration, have decided that as the statements are factual it would be sufficient if a suitable entry is made in the said confidential report to the effect that the suspension was subsequently lifted and the period was treated duty and that further action was stayed as there were no good grounds to hold him guilty of any of the charges levelled against him.
(3) A suitable entry has accordingly been made in the confidential report for the year ending 31 3 1968".
We have expressly referred to this order of the Government to show that it completely demolishes the case of malafide pleaded by 11 625SCI/79 742 Reddy against Mr. K. Brahmanand Reddy, respondent No. 3 in the High Court because if Mr. K. Brahmanand Reddy had any animus against the officer he would not have accepted his representation and denuded the effect of the adverse entry made at the time when Reddy was suspended.
According to the allegations made by the State of Andhra Pradesh on the 7th August, 1975 a Review Committee consisting of the Chief Secretary, Home Secretary and the Inspector General of Police considered various cases of police officers including the case of Reddy and made their recommendations.
On 11th September, 1975 the Government of India after considering the report of the Review Committee ordered compulsory retirement of Reddy in public interest on the expiry of three months ' notice from the date of service of order on him.
This order was passed by the Central Government in consultation with the State Government hereinafter referred to as the impugned order) as may be extracted thus: "In exercise of the powers conferred by Sub rule 3 of Rule 16 of the All India Service (Death cum Retirement) Rules, 1958, the President, in consultation with the Government of Andhra Pradesh, is pleased to order the retirement of Sri M. E. Reddy a member of the Indian Police Service borne on the cadre of Andhra Pradesh, in the public interest, on the expiry of three months from the date of service of this order on him".
This order purports to have been passed under sub rule (3) of Rule 16 of the All India Service (Death cum Retirement) Rules, 1958 which reads as follows: "16(3) The Central Government, in consultation with the State Government, may require a member of the Service who has completed 30 years of qualifying service or who has attained the age of 55 years to retire in the public interest provided that at least three months ' previous notice in writing will be given to the member concerned".
An analysis of this Rule clearly shows that the following essential ingredients or the Rule must be satisfied before an order compulsorily retiring a Government servant is passed: 1.
That the member of the Service must have completed 30 years of qualifying service or the age of SO years (as modified by notification dated 16 7 1969), 2.
That the Government has an absolute right to retire the Government servant concerned because the word require" clearly confers an unqualified right on the Central Government; 743 3.
That the order must be passed in public interest; 4.
That three months ' previous notice in writing shall be given to the Government servant concerned before the order is passed.
It may be noted here that the provision gives an absolute right to the Government and not merely a discretion, and, therefore, impliedly it excludes the rules of natural justice.
It is also not disputed in the present case that all the conditions mentioned in Rule referred to above have been complied with.
It is a different matter that the argument of Reddy is based on the ground that the order is arbitrary and mala fide with which we shall deal later.
On a perusal of the impugned order passed by the Government of India it would appear that the order fully conforms to all the conditions mentioned in Rule 16 (3).
It is now well settled by a long catena of authorities of this Court that compulsory retirement after the employee has put in a sufficient number of years of service having qualified for full pension is neither a punishment nor a stigma so as to attract the provisions of article 311 (2) of the Constitution.
In fact, after an employee has served for 25 to 30 years and is retired on full pensionary benefits, it cannot be said that he suffers any real prejudice.
The object of the Rule is to weed out the dead wood in order to maintain a high standard of efficiency and initiative in the State Services.
It is not necessary that a good officer may continue to be efficient for all times to come.
It may be that there may be some officers who may possess a better initiative and higher standard of efficiency and if given chance the work of the Government might show marked improvement.
In such a case compulsory retirement of an officer who fulfils the conditions of Rule 16 (3) is undoubtedly in public interest and is not passed by way of punishment.
Similarly, there may be cases of officers who are corrupt or of doubtful integrity and who may be considered fit for being compulsorily retired in public interest, since they have almost reached the fag end of their career and their retirement would not cast any aspersion nor does it entail any civil consequences.
Of course, it may be said that if such officers were allowed to continue they would have drawn their salary until the usual date of retirement.
But this is not all absolute right which can be claimed by an officer who has put in 30 years of service or has attained the age of 50 years.
Thus, the general impression which is carried by most of the employees that compulsory H retirement under these conditions involves some sort of stigma must he completely removed because rule 16 (3) does nothing of the sort.
744 Apart from the aforesaid considerations we would like to illustrate the jurisprudential philosophy of rule 16 (3) and other similarly worded provisions like Rule 56 (j) and other rule relating to the Government servants.
It cannot be doubted that rule 16 (3) as it stands is but one of the facets of the doctrine of pleasure incorporated in Article 310 of the Constitution and is controlled only by those contingencies which are expressly mentioned in Article 311.
If the order of retirement under rule 16 (3) does not attract Article 311 (2) it is manifest that no stigma of punishment is involved.
The order is passed by the highest authority, namely, the Central Government in the name of the President and expressly excludes the application of rules of natural justice as indicated above.
The safety valve of public interest is the most powerful and the strongest safeguard against any abuse or colourable exercise of power under this Rule.
Moreover, when the Court is satisfied that the exercise of power under the rule amounts to a colourable exercise of jurisdiction or is arbitrary or made it can always be struck down.
While examining this aspect of the matter the Court would have to act only on the affidavits, documents, annexures, notifications and other papers produced before it by the parties.
It cannot delve deep into the confidential or secret records of the Government to fish out materials to prove that the order is arbitrary or mala fide.
The Court has, however, the undoubted power subject to any privilege or claim that may be made by the State, to send for the relevant confidential personal file of the Government servant and peruse it for its own satisfaction without using it as evidence.
It seems to us that the main object of this Rule is to instil a spirit of dedication and dynamism in the working of the State Services so as to ensure purity and cleanliness in the administration which is the paramount need of the hour as the Services are one of the pillars of our great democracy.
Any element or constituent of the Service which is found to be lax or corrupt, inefficient or not up to the mark or has outlived his utility has to be weeded out.
Rule 16 (3) provides the methodology for achieving this object.
We must, however, hasten to add that before the Central Government invokes the power under Rule 16 (3), it must take particular care that the rule is not used as a ruse for victimisation by getting rid of honest and unobliging officers in order to make way for incompetent favourites of the Government which is bound to lead to serious demoralisation in the Service and defeat the laudable object which the rule seeks to subserve.
If any such case comes to the notice of the Government the officer responsible for advising the Government must be strictly dealt 745 with.
Compulsory retirement contemplated by the aforesaid rule is designed to infuse the administration with initiative and activism so that it is made poignant and piquant, specious and subtle so as to.
meet the expanding needs of the nation which require exploration of "fields and pastures now".
Such a retirement involves no stain or stigma nor does it entail any penalty or civil consequences.
In fact, the rule merely seeks to strike a just balance between the termination of the completed career of a tired employee and maintenance of top efficiency in the diverse activities of the administrating.
An order of compulsory retirement on one hand causes no prejudice to the Government servant who is made to lead a restful life enjoying full pensionary and other benefits and on the other gives a new animation and equanimity to the Services.
The employees should.
try to understand the true spirit behind the rule which is not to penalise them but amounts just to a fruitful incident of the Service made in the larger interest of the country.
Even if the employee feels that he has suffered, he should derive sufficient solace and consolation from the fact that this is his small contribution to his country for every good cause claims its martyr.
These principles are clearly enunciated by a series of decisions of this Court starting from Shyam Lals(1) case to Nigams (2) case which will be referred to hereafter.
In the case of Shyam Lal vs The State cf Uttar Pradesh & Anr.(1) This Court clearly held that compulsory retirement does not amount to removal or termination nor does it involve any stigma.
In this connection, a Bench of 5 Hon 'ble Judges of this Court observed as follows: "There is no such element of charge or imputation in the case of compulsory retirement.
The two require ments for compulsory retirement are that the officer has completed twentyfive years ' service and that it is in the public interest to dispense with his further services.
It is true that this power of compulsory retirement may be used when the authority exercising this power cannot substantiate the misconduct which may be the real cause for taking the action but what is important to note is that the directions in the last sentence in Note l to article 465 A 746 make it abundantly clear that an imputation or charge is not in terms made a condition for the exercise of the power.
In other words, a compulsory retirement has no stigma or implication of misbehaviour or incapacity".
"The more important thing is to see whether by compulsory retirement the officer loses the benefit he has earned as he does by dismissal or removal.
The answer is clearly in the negative.
The second element or determining whether a termination of service amounts to dismissal or removal is, therefore, also absent in the case of termination of service brought about by compulsory retirement.
The foregoing discussion necessarily leads us to the conclusion that a compulsory retirement does not amount to dismissal or removal and, therefore, does not attract the provisions of Article 311 of the Constitution or of rule 55".
The same principle was reiterated by another Bench of S Hon 'ble Judges of this Court in the case of T. G. Shivacharan Singh & Ors.
vs The State of Mysore.(1) In this case, the Court was considering the scope of rule 285 which was almost in the same terms as rule 16 (3) and provided that a Government servant could be retired, after completing qualifying service of 30 years or on attaining the age of 50 years if such retirement was considered in public interest.
In this connection, the Court observed as follows: "It would thus be clear that though the normal age of retirement under R. 95 (a) is 55 years, under R. 285 it is competent to the Government to retire compulsorily a government servant prematurely if it is thought that such premature retirement is necessary in the public interest . . .
Mr. Venkataranga Iyengar contends that this Rule is invalid, because it contravenes article 14 as well as article 16 (1) of the Constitution.
In our opinion this contention can no longer be entertained.
because it is concluded by a long series of decisions of this Court".
Even the constitutionality of the provisions concerned was upheld by this Court.
The leading case on the subject which has been decided some years before and has been consistently followed by latter decisions 747 of this Court is the case of Union of India vs Col. J. N. Sinha & Anr.(1).
This Court was considering the scope and ambit of rule 56 (j) which is also worded in the same terms as rule 16 (3).
Rule 56 (3) runs thus: "Notwithstanding anything contained in this Rule the appropriate authority shall, if it is of the opinion that it is in the public interest so to do have the absolute right to retire any Government servant by giving him notice of not less than three months in writing or three months ' pay and allowances in lieu of such notice.
(i) if he is in Class I or Class II Service or post the age for the purpose of direct recruitment to which is below 35 years, after he has attained the age of 50 years.
(ii) In any other case after he has attained the age of 55 years.
D Provided that nothing in this clause shall apply to a Government servant referred to in clause (e) who entered Government service on or before 23rd July 1966 and to a Government servant referred to in clause (f)".
After considering the various shades, aspects, purpose and object E of such provision this Court observed as follows: "But if on the other hand a statutory provision either specifically or by necessary implication excludes the application of any or all the principles of natural justice then the court cannot ignore the mandate of the legislature or the statutory authority and read into the concerned provision the principles of natural justice".
"The right conferred on the appropriate authority Is an absolute one.
That power can be exercised subject to the conditions mentioned in the rule, one of which is that the concerned authority must be of the opinion that it is in public interest to do so.
If that authority bona fide forms that opinion, the correctness of that opinion cannot be challenged before courts.
It is open to an aggrieved party to contend that the requisite opinion has not been formed or the decision is based on collateral grounds or that it is 748 an arbitrary decision Compulsory retirement involves no civil consequences.
The aforementioned rule 56 (j) is not intended for taking any penal action against the government servant.
That rule merely embodies one of the facets of the pleasure doctrine embodied in Article 310 of the Constitution.
Various considerations may weigh with the appropriate authority while exercising the power conferred under the rule.
In some cases, the government may feel that a particular post may be more usefully held in public interest by an officer more competent than the one who is holding.
It may be that the officer who is holding the post is not inefficient but the appropriate authority may prefer to have a more efficient officer.
It may further be that in certain key posts public interest may require that a person of undoubted ability and integrity should be there.
There is no denying the fact that in all organisations and more so in government organisations, there is good deal of dead wood.
It is in public interest to chop off the same.
Fundamental Rule 56 (j) holds the balance between the rights of the individual government servant and the interests of the public.
While a minimum service is guaranteed to the government servant, the government is given.
power to energies its machinery and make it more efficient by compulsorily retiring those who in its opinion should not be there in public interest".
The observations made above clearly reveal the object of this rule and lay down that where an officer concerned is of doubtful integrity he can be compulsorily retired under this rule.
Mr. Krishnamurthy Iyer appearing for Reddy submitted that the order impugned is passed on materials which are non existent in as much as there are no adverse remarks against Reddy who had a spotless career throughout and if such remarks would have been made in his confidential reports they should have been communicated to him under the rules.
This argument, in our opinion, appears to be based on a serious misconception.
In the first place, under the various rules on the subject it is not every adverse entry or remark that has to be communicated to the officer concerned.
The superior officer may make certain remarks while assessing the work and conduct of the subordinate officer based on his personal supervision or contact.
Some of these remarks may be purely innocuous, or may be connected with general reputation of honesty or integrity that a particular officer enjoys.
It will indeed be difficult if not impossible to prove by positive evidence 749 that a particular officer is dishonest but those who has had the opportunity to watch the performance of the said officer from close quarters are in a position to know the nature and character not only of his performance but also of the reputation that he enjoys.
The High Court has also laid great stress on the fact that as adverse entries had not been communicated to Reddy, therefore, the order impugned is illegal.
We find ourselves unable to agree with the view taken by the High Court or the argument put forward by learned counsel for Reddy.
Moreover, the appellant had denied in their counter affidavit at page 59 Vol.
II that there was no adverse entry against the officer concerned prior to 1968.
This averment is contained in para 6 of the counter affidavit filed by Under Secretary to the Government of India in the High Court.
This aspect as considered by this Court in the case of R. L. Butail vs Union of India ors.(l) and the matter is concluded by the very apt observations made by Hidayatullah, C.J. who spoke for the Court and observed as follows: "These rules abundantly show that a confidential report is intended to be a general assessment of work performed by a Government servant subordinate to the reporting authority, that such reports are maintained for the purpose of serving as data of comparative merit when questions of promotion, confirmation etc.
arise.
They also show that such reports are not ordinarily to contain specific incidents upon which assessments are made except in cases Where as a result of any specific incident a censure or a warning is issued and when such warning is by an order to be kept in the personal file of the Government servant.
In such a case the officer making the order has to give a reasonable opportunity to the Government servant to present his case.
The contention, therefore, that the adverse remarks did not contain specific instances and were, therefore, contrary to the rules, cannot be sustained.
Equally unsustainable is the corollary that because of that omission the appellant could not make an adequate representation and that there fore the confidential reports are vitiated".
G "It may well be that in spite of the work of the appellant being satisfactory, as he claimed it was, there may have been other relevant factors, such as the history of the appellant 's entire service and confidential reports through out the period of his service, upon which the appropriate authority may still decide to order appellant 's retirement under F.R. 56 ( j ) ".
750 In this case the Court followed and endorsed the decision of this Court in the case of J. N. Sinha (supra).
Here we might mention that the appellants were fair and candid enough to place the entire confidential personal file of Reddy before us starting from the date he joined the Police Service and after perusing the same we are unable to agree with Mr. Krishnamurthy Iyer that the officer had a spotless career.
The assessment made by his superior officers from the very beginning of his service until the impugned order was passed show that at best Reddy was merely an average officer and that the reports show that he was found to be sometimes tactless, impolite, impersonated and suffered from other infirmities though not all of them were of a very serious nature so as to amount to an adverse entry which may be communicated to him.
We might also mention that before passing an order under rule 16(3) it is not an entry here or an entry there which has to be taken into consideration by the Government but the overall picture of the officer during the long years of his service that he puts in has to be considered from the point of view of achieving higher standard of efficiency and dedication so as to be retained even after the officer has put in the requisite number of years of service.
Even in the last entry which was sought to be expanded through a representation made by Reddy and other entries made before it appears that the integrity of Reddy was not above board.
Even in the case of State of Uttar Pradesh vs Chandra Mohan Niganm & Ors.(1) on which great reliance has been placed by Mr. Krishnamurthy Iyer, it was observed thus: "We should hasten to add that when integrity of an officer is in question that will be an exceptional circumstance for which orders may be passed in respect of such a person under rule 16(3), at any time, if other conditions of that rule are fulfilled, apart from the choice of disciplinary action which will also be open to Government.
Thus, even according to the decision rendered by this Court in the aforesaid case the fact that an officer is of doubtful integrity stands on a separate footing and if he is compulsorily retired that neither involves any stigma nor any error in the order.
We might also refer to an observation made by the Single Judge of the High Court whose judgment was confirmed by the Division Bench, who appears to have misconstrued a judgment of this Court and by the process of such misconception seems to have ignored the later decisions of this Court given by small Benches on the exact question at 751 issue.
The learned Judge relied on the decision in the case of Madan Mohan Prasad vs State of Bihar & Ors.(1) in support of the view that the order of retirement even if it is in public interest violates Article 311 (2) of the Constitution even though no punishment was intended.
The learned Judge observed as follows: "In Madan Mohan vs State of Bihar (supra) the Supreme Court considered the validity of retirement order of a Judicial officer who for the reason that he worked for seventeen years asserted was permanent member of the service when his retirement was ordered under Bihar pension Rules of 1950 questioned the order under article 32 of the Constitution of India that it was a punishment within the meaning of article 311 (2) of the Constitution of India".
and then relies on certain observations of this Court in order to hold that the termination of service of the officer casts a stigma on his character and attracts Article 311(2) of the Constitution.
The learned Judge further relied on a decision of this Court in support of the proposition that a judgment rendered by S Judges of the Supreme Court would prevail over a judgment of a smaller Bench.
So far this part of the observation is concerned, there can be no doubt.
But the learned Judge appears to have completely misconstrued the decision in Madan Mohan 's case (supra) which was not a case of compulsory retirement at all, nor was it a case where the officer concerned was retired under a rule like rule 56(j) or 16(3) as we have indicated in this case.
On the other hand, in that case what happened was that the officer was appointed as a temporary Munsif and under the terms of the notification by which he was appointed it was provided that the appointment of temporary Munsif could be terminated by giving one month 's notice.
The High Court it appears, was not satisfied with the work of Munsif and accordingly decided to terminate his services.
But the Chief Minister in one of his speeches on the floor of the House had made certain observations implying that the services of the Munsif were being terminated on account of inefficiency and misconduct.
In these peculiar circumstances, therefore, this Court held that the termination of the Munsif even though he was a temporary servant cast a stigma and, therefore, attracted Article 311 of the Constitution.
In this connection, the Court observed as follows: "It seems to us that on the facts of this case, the order dated January 15, 1972 violates Article 311(2) of the Constitution.
The petitioner had first been holding a temporary post and then a permanent post for nearly seventeen 752 years.
The Chief Minister s statement in the Assembly that his services were not satisfactory and the Government was considering serving show cause notice and the fact that his services were terminated without any enquiry being held would inevitably lead the public to believe that his services had been terminated on account of inefficiency or misconduct.
This did cast a stigma on his character".
It is, therefore, manifest that the facts of this case and the points involved were absolutely different from the facts of the present case.
The aforesaid case relied upon by the High Court would have absolutely no application to the present case where Reddy was neither a temporary servant nor was his service terminated.
The Single Judge of the High Court was, therefore, absolutely wrong in equating the principles of compulsory retirement under rule 16(3) with termination of the services of a temporary employee under the rules.
Similarly, the case of J. N. Sinha (supra) was followed and relied on by later decisions of this Court in the case of N. V. Puttabhatta vs The State Mysore & Anr.(1) as also in the case of State of Assam and Anr.
vs Basanta Kumar Das etc.
etc.(2) Again, in the case of Tara Singh etc.
vs State of Rajasthan & Ors(8) it was pointed out that compulsory retirement under the provisions similar to rule 16(3) cannot amount to a stigma, and the incidents of compulsory retirement were adroitly summed up by Ray, C.J. who observed as follows: "The right to be in public employment is a right to hold it according to rules.
The right to hold is defeasible according to rules.
The rules speak of compulsory retirement.
There is guidance in the rules as to when such compulsory retirement is made.
When persons complete 25 years of service and the efficiency of such persons is impaired and yet it is desirable not to bring any charge of Inefficiency or incompetency, the Government passes order of such compulsory retirement.
The Government servant in such a case does not lose the benefits which a Government servant has already earned.
These orders of compulsory retirement are made in public interest.
This is the safety valve of making such orders so that no arbitrariness or bad faith creeps in".
753 "There is no stigma in any of the impeached orders of compulsory retirement".
The learned Chief Justice pointed out that having regard to the safeguards contained in the rules particularly the fact that the retirement was in public interest the safety valve of safeguarding malafide or arbitrariness in the order was clearly contained in the provision itself.
J. N. Sinha 's case (supra) was endorsed and followed in this case also.
In a recent decision of this Court in the case of Mayenghoan Rahamohan Singh vs The Chief Commissioner (Admn.) Manipur & Ors.
the Court observed as follows: "Compulsory retirement is not a punishment.
There is no stigma in compulsory retirement".
"The affidavit evidence is that the order of compulsory retirement was made in public interest.
The absence of recital in the order of compulsory retirement that it is made in public interest is not fatal as long as power to make compulsory retirement in public interest is there and the power in fact is shown in the facts and circumstances of the case to have been exercised in public interest".
In this case, the Court was considering the scope of rule 56(j) which, as already indicated, is couched in the same terms as rule 16(3).
Learned counsel for Reddy heavily relied on the decision of this Court in the case of State of Uttar Pradesh vs Chandra Mohan Nigam & Ors.
(supra) and contended that as the Government of India while passing the impugned order had not considered the report of the Review Committee the order is vitiated by an error of law.
We have gone through this decision and we are unable to agree with the contentions put forward by learned counsel for Reddy.
The decision referred to above is not an authority for holding that the decision of the Review Committee is binding on the Government of India.
All that is necessary is that the Government of India should, before passing an order under rule 16(3) consider the report of the Review Committee which is based on full and completed analysis of the history of the service of the employee concerned.
In the instant case, it is clearly pleaded by the appellants in the High Court that the report of the Review Committee was in fact considered by the Government of India before passing the impugned order.
The confidential file placed before us also clearly shows that on the note sheet the notes by the 754 Secretary on the recommendations of the Review Committee the Home Minister, Mr K. Brahmananda Reddy has appended his signatures and has passed the order that Reddy should be compulsorily retired.
Furthermore, in Nigam 's case (supra) referred to above what had weighed with the Court was that after the Review Committee had submitted its report to the Government, the Government ordered a second Review Committee just in order to enable the Review Committee to give an adverse report against the officer concerned.
Such a course of action was condemned and deprecated by this Court.
In the instant case, however, there is no allegation by Reddy that any second Committee was ever appointed.
Even so in Nigam 's case (supra) this Court did not depart from the ratio laid down in Sinha 's case (supra) and followed by later cases but observed as follows: "As stated earlier, even in the case of compulsory retirement under rule 16(3), an order may be challenged in a court if it is arbitrary or mala fide.
If, however, the Government reaches a decision to prematurely retire a Government servant, bona fide the order, per se, cast any stigma on the employee nor does the employee forfeit any benefit which he has already earned by his service, nor does it result in any civil consequences".
The Court at page 531 of the Report clearly pointed out that the instructions issued by the Government for constituting the Review Committee were not mandatory.
We have already indicated above that this Court made it absolutely clear that where a person was retired under Rule 16(3) on the ground that his integrity was in question, the observations made by this Court would have no application.
in the instant case, it has been clearly averred by the appellants that the integrity of Reddy was not beyond suspicion and the remarks were rot expressly expunged by the Chief Minister.
Reliance was also placed by learned counsel for Reddy on a recent decision of this Court in the case of Smt.
S.R. Venkataraman vs Union of India & Anr.
The facts of this case, however, are, clearly distinguishable from the facts of the present case.
In that case there was a finding of fact by this Court that the order of retirement was mala fide and amounted to victimisation and the allegation made by the appellant before this Court were not only not disputed but counsel for the Union of India went to the extent of saying that he was not in a position to support the impugned order which was 755 unfair.
It was in the background of these circumstances that the Court held that the order was malafide and observed as follows: "The appellant has pointed out in this connection that her service record was examined in March, 1976 by the Departmental Promotion Committee, with which the Union Public Service Commission was associated, and the Committee considered her fit for promotion to the selection grade subject to clearance in the departmental proceedings which were pending against her, and that she was retired because of bias and animosity.
Our attention has also been invited to the favourable entry which was made in her confidential report by the Secretary of the Ministry.
Mr. Lekhi, learned counsel for the Union of India, produced the relevant record of the appellant for our perusal.
While doing so he frankly conceded that there was nothing on the record which could justify the order of the appellant 's premature retirement.
He went to the extent of saying that the Government was not in a position to support that unfair order" "The influence of extraneous matters will be undoubted where the authority making the order has admitted their influence.
It will therefore he a gross abuse of legal power to punish a person or destroy her service career in a manner not warranted by law by putting a rule which makes a useful provision for the premature retirement of government servants only in the 'public interest ', to a purpose wholly unwarranted by it, and to arrive at quite a contradictory result.
An administrative order which is based on reasons of fact which do not exist must therefore be held to be infected with an abuse of power".
These observations, however, do not apply to the facts of the present case.
Lastly, Mr. Krishnamurthy Iyer, learned counsel for Reddy heavily relied on a decision of the Calcutta High Court in the case of Chief Security Officer, Eastern Railway & Anr.
vs Ajay Chandra Bagchi on a perusal of this decision we are of the opinion that this case was not correctly decided as it is directly opposed to the ratio decidendi of J. N. Sinha 's case (supra) where this Court held that the rule in question expressly excludes the principles of natural justice and, therefore, it is manifest that the Calcutta High Court was in error in basing 756 its decision on rules of natural justice.
The Calcutta High Court in this case had observed as follows: "Thus even if the Railway authorities had absolute right to retire the Respondent petitioner subject to the requirements as mentioned hereinbefore and in terms of paragraph 3 of Chapter XVII of the Regulations read with item 6 of the instructions in the Form in Appendix XVlI in the admitted position of the case, viz., certain adverse entries were taken into consideration in having him compulsorily retired, the action as taken is thus certainly against all principles of natural justice and norms of fair play and as such the action so taken cannot be supported.
The said right under paragraph 3 of Chapter XVII read with item 6 of the instructions in the Form in Appendix XVIII can be used and those principles can be applied or resorted to subject to the principles of natural justice, which incidentally is the restraint put on the pretended misuse of power".
The High Court seemed to rely on certain adverse entries which were taken into consideration when the order of retirement was passed.
We have already pointed out relying on the dictum of this Court laid down by Hidayatullah, C.J. that the confidential reports can certainly be considered by the appointing authority in passing the order of retirement even if they are not communicated to the officer concerned.
Thus, the two grounds on which the Calcutta decision was based are not supportable in law.
For these reasons, therefore, we hold that the decision of the Calcutta High Court referred to above was wrongly decided and is hereby overruled.
On a consideration of the authorities mentioned above we are satisfied that there is no legal error in the impugned order passed by the Government of India retiring Reddy.
It was, however, contended by counsel for Reddy that reading the order as a whole it contains an odour of victimisation, so as to make the order arbitrary.
We are, however, unable to find any material on the record to show that the order was in any way arbitrary.
The Government of India acted on the orders passed by the Home Minister concerned who had considered the report of the Review Committee in its various aspects.
There is nothing to show that Reddy was victimised in any way.
On the other hand, the history of his service shows that he was always given his due.
He was taken in the I.P.S. and allotted the year 1952.
He was promoted to the selection grade also at the proper time.
The order of suspension was withdrawn and the departmental enquiry was dropped 757 and the officer was reinstated and later promoted as D.I.G. These facts completely militate against the concept of victimisation.
It appears that on an overall consideration of the entire history of the service of Reddy and the various stages through which he had passed it was considered in the interest of administration and to ensure better initiative and efficiency to retire him in public interest.
We are also unable to find any element of arbitrariness in the impugned order.
For these reasons, therefore, the first contention raised by learned counsel for Reddy must be rejected.
It was then contended that the order was mala fide and passed because Respondent No. 3, the Chief Minister of Andhra Pradesh bore serious animus against Reddy and wanted him to do certain things which he refused to do, hence he was compulsorily retired.
Apart from the fact that all the allegations regarding mala fide stood withdrawn as indicated in the earlier part of the judgment it is alleged in the counter affidavit and this averment has not been disputed before us that on 5 1 1970 the following Memo was filed on behalf of Reddy before the High Court: "The petitioner withdraws the writ petition including the allegations against the Hon 'ble Chief Minister of Andhra Pradesh.
The writ petition may kindly be dismissed as with drawn".
Furthermore, the counter affidavit at p. 73 Vol.
IV contains a letter submitted by the Second Go Pleader on 5 1 1970 the relevant part of which runs thus: "I have discussed the matter with the Advocate for the petitioner.
He agrees to withdraw the writ petition as also the allegations made thereunder against the Hon 'ble Chief Minister and is prepared to file a Memo.
Copy of which is enclosed herewith" Once Reddy had withdrawn the allegations of malafide against respondent No. 3 in the High Court, it is not open to him to revive those allegations in these proceeding when the impugned order is passed.
The impugned order as held by us is a bona fide order and does not suffer from any legal infirmity, and, therefore, we cannot permit Reddy to play a game of hide and seek with the Court by withdrawing the allegations of mala fide against respondent No. 3 in the High Court and then reviving them when after some time an adverse order against him was passed.
Moreover, if respondent No. 3 was really inimically disposed towards Reddy he would not have either dropped the departmental enquiry or reinstated him, or have promoted him to the rank 758 of D.I.G. Furthermore, the Chief Minister Mr. K. Brahmananda Reddy has himself filed a personal affidavit before the High Court which is contained at page 235 Vol.
III wherein he has categorically denied all the allegations made against him by Reddy.
The assertions made in the affidavit are fully supported by circumstantial evidence and the conduct of Reddy himself.
For these reasons, therefore, the second contention regarding the impugned order being mala fide is also rejected.
The result is that all the contentions raised by counsel for Reddy fail.
We are clearly of the opinion that the High Court committed a clear error of law in quashing the impugned order which was fully justified by rule 16(3), and did not suffer from any legal infirmity and was also in consonance with the law laid down by this Court starting from Shyamlal 's case upto Sinha 's and Nigam 's case (supra) discussed above.
We, therefore, allow the appeals, set aside the order of the High Court and restore the impugned order retiring Reddy.
In the peculiar circumstances of the case there will be no order as to costs.
S.R. Appeal allowed.
[/INST]The petitioner, who was an Advocate, was authorised by the Government to represent it in all the civil cases in a district court.
Considering the pendency of a large number of Government cases before courts and tribunals the Government appointed nine Assistant Government Pleaders during the term of office of the petitioner as Government Pleader and asked him to make over all the land acquisition cases to one of the Assistant Government Pleaders.
The petitioner refused to comply with the Government 's instructions and stated That he would himself conduct all the cases.
The Government, however, stuck to its stand.
His writ petition impugning the Government 's decision was dismissed by the High Court.
Dismissing the petition under article 136.
^ HELD: 1.
The definition of Government Pleader contained in section 2(7) of the Code of Civil Procedure is an inclusive definition which, read along with O. 21, rr. 4 and 8(c) clearly yields the inference that Government may have as many Government Pleaders as it likes to conduct its cases.
The section vests no sole control on one Government Pleader over others and the Government is perfectly free to put a particular Government Pleader in charge of particular cases.
Government Pleaders and Assistant Government Pleaders who had been appointed according to administrative rules of the State are Government Pleaders within the meaning of the definition in section 2(7) of the Code.
Each one of them may depute other lawyers and exercise control over such surrogates.
[763 G; 764 C] 2.
The Bihar Rules regarding Government Pleaders, which are purely administrative prescriptions and which serve as guidelines and on which no legal right can be founded do not help the petitioner.
The allocation of work or control inter se is an internal arrangement and there is no error in the behaviour of the Government.
[764F G] 3.
When there were several thousand cases in the courts in the State and hundreds of cases before Tribunals it was but right that Government did not sacrifice the speedy conduct of cases by not appointing a number of pleaders.
It is inconceivable how the petitioner would have discharged his duties to the court and to the client of this crowd of land acquisition cases was posted in several courts more or less at the same time.
[765D E] Ramachandran vs Alagiriswami, A.I.R. 1961 Madras 450, approved.
Despite the national litigation policy evolved by the All India Law Ministers ' Conference in 1957 and the recommendation of the Law Commission there is still a proliferation of government cases in courts uninformed 760 by such policy.
It is important that the State should be a model litigant with accent on settlement.
Time has come for State Governments to have a second look, not only at the litigation policy but lawyers ' fees rules especially in mass litigation involving ad valorem calculations in fixing fees in land acquisition cases.
[762 B; 763 CI 2.
The politicisation of Government Pleadership which is a public office is an issue of moment in a developing society controlled by the politics of skill and enjoying a legal monopoly.
It is a healthy practice that the Government appoints these lawyers after consultation with the District Judge.
Governments under our Constitution shall not play with law offices on political or other impertinent considerations as it may affect the legality of the action and subvert the rule of law itself [765 C]
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<s>[INST] Summarize the judgementon No. 217 of 1956.
Petition under Article 32 of the Constitution of India for enforcement of Fundamental rights.
Pandit Nanak Chand, for the petitioners.
I. N. Shroff, for respondent No. 1.
1960 February, 26.
The Judgment of the Court was delivered by SHAH, J.
This is a petition filed by Sahibzada Saiyed Muhammed Amirabbas Abbasi, who will hereinafter be referred to as the first petitioner on behalf of himself and as the natural guardian of his two minor children, Kamal Abbas and Jehanzeb Bano, petitioners Nos. 2 and 3 against the State of Madhya Bharat (now the State of Madhya Pradesh) and three other respondents for an appropriate writ or writs of Habeas Corpus, Mandamus, Certiorari, Prohibition and any other writ, direction or order directing the State of Madhya Bharat immediately to assume charge of the properties of the minor petitioners 2 and 3 and determining the amount of loss sustained by the minors and calling upon the State of Madhya Bharat and the other respondents to compensate the minors for the full value of the property lost due to their negligence in the discharge of their respective duties in failing to protect the minors ' properties, and calling upon the 4th respondent to produce the minors before this court and directing that the minors be handed over to the custody of some relation who is competent under the Personal Law to have their custody, and calling upon the Chief Secretary of the State of Madhya Bharat to furnish full particulars of the trust property released in favour of the 2nd respondent and directing the 1st respondent to produce in this court the box of jewellery entrusted to it with full particulars regarding its custody from March 29, 1948, and ascertaining whether the contents have 'been misappropriated and further ascertaining the loss, if any, occasioned to the minor petitioners and its quantum and declaring liability of the respondents in that behalf and for further relief which the court may award in the circumstances of the case, as just and proper.
140 Prima facie, the reliefs claimed ate not within the scope of a petition for a writ under article 32 of the Constitution.
This court has power under that Article to issue directions, orders or writs, including writs in the nature of habeas corpus, mandamus, prohibition, quo warranto and certiorari whichever may be appropriate for the enforcement of any of the fundamental rights; but by this petition, the first petitioner claims on the plea that the respodents have misappropriated or misapplied the property of petitioners 2 and 3, a writ or writs directing that loss sustained by the minors be ascertained and made good and also asks this court to provide for the custody of the minors according to their Personal Law.
The facts which give rise to the petition are these: The first petitioner married in 1940 one Naiyar Jahan Begam and by her he had two children petitioners 2 and 3.
Naiyar Jahan Begam died in the year 1943 and petitioners 2 and 3 were thereafter looked after by Musharraf Jahan Begam, mother of Naiyar Jahan Begam.
From her father Naiyar Jahan Begam had inherited certain valuable property and from her mother, Musharraf Jahan Begam, she had received a dowry of substantial value at the time of her marriage.
Before she died on March 6, 1949, Musharraf Jehan Begam had made a trust in respect of certain property of the benefit of petitioners 2 and 3.
The first petitioner had after the death of Naiyar Jehan Begam contracted a second marriage and of that marriage there were three children.
During the life of Musharraf Jehan Begam the first petitioner took no interest in petitioners 2 and 3 and at sometime in the year 1948, he migrated to West Pakistan and took up residence in Rawalpindi.
After the death of Musharraf Jehan Begam, the first petitioner applied to the Madhya Bharat High Court for a writ in the nature of habeas corpus for a direction to produce petitioners 2 and 3 before the court on the allegation that the latter were wrong fully detained The High Court refused to give the direction and ordered that the first petitioner might, if so advised, apply under the Guardian and Wards Act for appropriate relief.
The first petitioner then applied to the 141 court of the District Judge at Ratlam for an order that he be appointed a guardian of the person and property of petitioners 2 and 3.
On November 23, 1949, the second respondent, Sultan Hamid Khan, cousin of Musharraf Jehan Begam applied that he be appointed guardian of the person and property of petitioners 2 and 3 and by order dated December 5, 1949, the District Court appointed him guardian and rejected the application filed by the first petitioner.
Against the order passed by the District Court, Ratlam, Appeal No. 20 of 1950 was filed in the High Court of Madhya Bharat.
This appeal was dismissed on March 29, 1954.
An application for special leave to appeal to this court under Act.
136 against that order of the High Court was rejected on November 12, 1956.
The first petitioner had, in the meantime, applied to this court under article 32 of the Constitution for the reliefs which have already been set out.
To this petition, petitioners 2 and 3 were impleaded as party petitioners, the first petitioner alleging that he was their natural guardian and next friend.
Evidently, the first petitioner could not claim to be the next friend of the minor petitioners 2 and 3, a guardian of their person and property having been appointed by the District Court, Ratlam, unless this court for reasons to be recorded deemed it to be for the welfare of the minors that the first petitioner be permitted to act or be appointed as the case may be (vide 0. 32, r. 4 of the Code of Civil Procedure).
The first petitioner did not obtain any order of this court permitting him to act as the next friend of petitioners 2 and 3 notwithstanding the order passed by the District Court appointing respondent No. 2 as their guardian.
The petition filed by the first petitioner is a somewhat prolix document.
The first petitioner claimed that the interest of the second respondent who was appointed a guardian by the District Court was adverse to the interests of the minors, and that the latter was, in any event, unfit to be appointed a guardian of the minors, that the second respondent had misappropriated the property of the minors and that he was not looking after the minors and was 142 acting contrary to their interest and that proceedings in the District Court were vitiated on account of partiality and collusion ' and by reason of deliberate violation of the order passed by the High Court.
The petitioner also claimed that the State of Madhya Bharat was bound to take steps to protect the entire property of the minor petitioners 2 and 3, but the first respondent had neglected to do so and had thereby rendered itself liable to make good the loss.
On these allegations, the first petitioner submitted that the minor petitioners were deprived of the equal protection of the laws in force including the Personal Law and were accordingly discriminated against and their property was, by reason of such discrimination in serious danger of being wasted or mis appropriated.
He also submitted that he could not be denied his rights under the Personal Law governing the minors as their natural guardian, merely because he had acquired a foreign domicile.
Exercising jurisdiction under article 32 of the Constitution, this court may grant relief for enforcement, only of the rights conferred by Part III of the Constitution.
The alleged right of the first petitioner to guardianship of his minor children under the Personal Law is not one of the fundamental rights guaranteed to him by the Constitution; 'nor by appointing respondent No. 2 as the guardian of the minors under the Guardian and Wards Act is discrimination practised against the minors.
The second respondent was appointed guardian of the minors by order of a competent court.
and denial of equality before the law or the equal protection of the laws can be claimed against executive action or legislative process but not against the decision of a competent tribunal.
The remedy of a person aggrieved by the decision of a competent judicial tribunal is to approach for redress a superior tribunal if there be one.
In the present case, against the order of the District Court appointing the second respondent the guardian of the person and property of the minors, an appeal was preferred to the High Court and that appeal was dismissed.
Even an application for special leave to appeal to this court was rejected, and the order of the District Court 143 became final.
If, since the date on which the order appointing the guardian of the minors, events have transpired which necessitate a modification of that order, the proper remedy of the first petitioner is to apply to the District Court for relief in that behalf and not to approach this court for a writ under article 32 of the Constitution.
This court has rejected the application for special leave to appeal under article 136; and that order cannot be circumvented by resorting to an application for a writ under article 32.
Relief under article 32 for enforcement of a right conferred by ch.
III can be granted only on proof of that right and in fringement thereof, and if, by the adjudication by a court of competent jurisdiction the right claimed has been negatived, a petition to this court under article 32 of the Constitution for enforcement of that right, notwithstanding the adjudication of the civil court, cannot be entertained.
The relief claimed by the first petitioner for assessing the liability of the respondents on the plea that they have either misappropriated the estate or by negligence caused loss to the estate of the minors, may be obtained in a properly constituted suit and not in a petition under article 32 of the Constitution.
The property to which the minors are or may be entitled may be ascertained in a proceeding under the Guardian and Wards Act or in a suit in the civil court and not in a petition under article 32 of the Constitution.
In our judgment, the petition is wholly misconceived and must be dismissed with costs payable by the first petitioner personally.
Petition dismissed.
[/INST]The first petitioner, who had migrated to West Pakistan, applied to the High Court of Madhya Bharat for a writ of abeas corpus for directions to produce petitioners 2 and 3, his minor children, before the Court on the allegation that they were wrongfully confined and, upon the dismissal of the said application, applied to the District Judge of Ratlam under the Guardian and Wards Act for his appointment as guardian of the person and property of the said minors.
The District judge rejected he application and appointed the second respondent as such Guardian.
The first petitioner appealed to the High Court against the said order of the District judge but that appeal was Dismissed.
He applied for special leave to appeal to this Court but that application was also rejected.
Thereafter the first Petitioner, as natural guardian of petitioners 2 and 3, filed the present petition under article 32 of the Constitution.
His casee in substance was that the interest of the second respondent was adverse to that of the minors, that he had misappropriated their property and that the first respondent, the State of Madhya Bharat, was bound to take steps to protect the property of the minors which it had failed to do and had thus rendered itself liable to make good the loss sustained by the minors in consequence.
Held, that the petition was wholly misconceived, and must be dismissed.
The Court can exercise jurisdiction under article 32 of the Constitution only in enforcement of the fundamental rights guaranteed by Part III of the Constitution.
Where on account of the decision of a court of competent jurisdiction, the right alleged by the petitioner does not exist and therefore its infringement cannot arise, this Court cannot entertain a petition under that Article for protection of the alleged right.
A claim as to denial of equality before the law or the equal protection of the laws can be made against executive action or against legislative process but not against the decision of a court of competent jurisdiction.
Nor can an order of this Court rejecting an application for special leave under article 136 of the Constitution be circumvented by an application for a writ under article 32.
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<s>[INST] Summarize the judgementCivil Appeal No. 4448 of 1985.
From the Judgment and order dated 26.
1982 of the Andhra Pradesh High Court in Tax Revision Case No. 23 of 1978.
WITH Civil Appeal No. 694 of 1986.
From the Judgment and order dated 31.7.1985 of the Andhra Pradesh High Court in Tax Revision Case No. 205 of 1985.
T.V.S.N. Chari for the Appellant.
739 R. Ramachandran for the Respondents.
The Judgment of the Court was delivered by VENKATARAMIAH, J.
The question of law which arises in these two appeals by special leave being a common, they are disposed of by this common judgment.
The said question relates to the time within which an assessment can be made under the provisions of the Andhra Pradesh General Sales Tax Act, 1957 (hereinafter referred to as 'the Act ') where the return is not filed by the dealer within the time prescribed in that behalf.
The assessee in Civil Appeal No. 4448 of 1985 is M/s. Nav Swadeshi oil Mills, Jadcharla, Mahboobnagar district.
For assessment year 1968 69 the assessee filed its return relating to the quarter ending 31.3.
,969 on 7.8.1969 before the Commercial Tax Officer of Mahboobnagar under the even though the last date for submission of return prescribed by law was 24.5.
The return filed by the assessee showing a taxable turnover of Rs. 18,25,410.72 was accepted and it was called upon to pay sales tax of Rs.45,424.48 under the Act.
The assessment order was passed on 3.8.1973 beyond four years from 31.3.1969 which was the last day of the assessment year 1968 69.
Aggrieved by the assessment order which had been passed beyond the period of four years from the last day of the assessment year the assessee filed an appeal before the Assistant Commissioner (CT) Appeals, Warangal in Appeal No. 5 75 76 and that appeal was dismissed on 14.9.1976.
Against the order of the Assistant Commissioner (CT) Appeals.
Warangal the assessee filed an appeal before the Sales Tax Appellate Tribunal, Andhra Pradesh at Hyderabad in Tribunal Appeal No. 183 of 1977.
That appeal also was dismissed.
The assessee thereafter filed a revision petition in Tax Revision Case No. 23 of 1978 before the High Court of Andhra Pradesh.
The High Court by its order dated October 26, 1982 set aside the order of the Tribunal and also the assessment on the ground that the assessment which had been passed after four years from the last day of the assessment year was not a valid assessment.
Aggrieved by the decision of the High Court the State of Andhra Pradesh has filed this appeal by special leave.
The assessee in Civil Appeal No. 694 of 1986 is M section Nav Swadeshi oil Mills and Refinery at Jadcharla.
In respect of the assessment year 1968 69 the assessee filed an annual return under the provisions of the on 19.8.
1969 after the expiry 740 Of the prescribed period.
The order of assessment was passed on 2.8.1973 beyond four years from the last day of the assessment year 1968 69.
Aggrieved by the assessment order which had been passed by the assessing authority the assessee filed an appeal before the Assistant Commissioner (CT) Appeals, Warangal on the ground that the asssessment order passed beyond four years from the last day of the assessment year was barred by time.
That appeal was dismissed.
Against the order passed in that appeal the assessee filed an appeal before the Sales Tax Appellate Tribunal, Andhra Pradesh in Tribunal Appeal No. 206 of 1977.
The Tribunal allowed the appeal and set aside the assessment holding that the assessment had been passed beyond time.
Aggrieved by the decision of the Tribunal the State of Andhra Pradesh filed a Revision Petition in Tax Revision Case No. 205 of 1985 on the file of the High Court of Andhra Pradesh.
That Revision Petition was dismissed in limine by the High Court.
Aggrieved by the decision of the High Court the State of Andhra Pradesh has filed this appeal by special leave.
The only question which arises for consideration in these appeals is whether the orders of assessment in the above two cases which had admittedly been passed beyond four years from the last day of the assessment year but within the period of six years from that date had been validly passed.
By virtue of section 9 of the the procedure prescribed for making an assessment under the Act is applicable to the assessments to be made under the .
Section 13 of the Act prescribes that every dealer who is liable to get himself registered under section 12 or section 12 A as the case may be under the Act shall submit such return or returns relating to his turnover in such manner within such period and to such authority as may be prescribed.
The material part of section 14 which is relevant for purposes of these cases reads thus: "14.
Assessment of tax: ( I) If the assessing authority is satisfied that any return submitted under section 13 is correct and complete, he shall assess the amount of tax payable by the dealer on the basis thereof, but if the return appears to him to be incorrect or incomplete he shall, after giving the dealer a reasonable opportunity of proving the correctness and completeness of the return submitted by him and making such inquiry as he deems necessary, assess to the best of his judgment, the amount of tax due from the dealer.
An assessment under this section shall be made only within a period of four years from the expiry of the 741 year to which the assessment relates.
. . . . (3) Where any dealer liable to tax under this Act (i) fails to submit return before the date prescribed in that behalf, or (ii) produces the accounts, registered and other documents after inspection, or (iii) submits a return subsequent to the date of inspection, the assessing authority may, at any time within a period of six years from the expiry of the year to which assessment relates, after issuing a notice to the dealer and after such enquiry as he considers necessary, assess to the best of his judgment, the amount of tax due from the dealer on his turnover for that year, and may direct the dealer to pay in addition to the tax so assessed penalty as specified in subsection (8).
" It is necessary to analyse sub section (1) and sub section (3) of section 14 of the Act for purposes of determining the issue involved in these cases.
Sub section ( ]) of section 14 of the Act provides that if the assessing authority is satisfied that any return submitted under section 13 is correct and complete, he shall assess the amount of tax payable by the dealer on the basis thereof but if the return appears to the assessing authority to be incorrect or incomplete he shall after giving the dealer reasonable opportunity of proving the correctness and completeness of the return submitted and making such inquiry as he deems necessary, assess to the best of his judgment, the amount of tax due from the dealer.
In both these cases the return contemplated is one which has been filed in accordance with section 13 of the Act within the time prescribed for that purpose.
Such an assessment under sub section ( 1) of section 14 of the Act can be made within a period of four years from the expiry of the period to which the assessment relates.
Sub section (3) of section 14 of the Act authorises the assessing authority to make an assessment to the best of his judgment in three cases: (i) where a dealer under the Act fails to submit return before the date prescribed in that behalf, (ii) where a dealer produces the accounts.
registers and other documents after inspection and (iii) where a dealer submits a return subsequent to the date of inspection.
In these three cases the 742 assessing authority is empowered to make an assessment to the best of '4 his judgment at any time within a period of six years from the expiry of the year to which the assessment relates after issuing a notice to the dealer and after such inquiry which he considers necessary to make the assessment.
The crucial question which arises for consideration in these cases is whether in a case where the assessee submits a true and complete return after the prescribed date the assessment should be completed within a period of four years prescribed by sub section ( 1) of section 14 of the Act or within a period of six years permitted under sub section (3) of section 14 of the Act.
Sub section (1) of section 14 of the Act relates to an assessment which may be made on the basis of a return submitted under section 13 of the Act.
Section 13 of the Act as stated above provides that every dealer shall submit such return or returns relating to his turnover in such manner within such period and to such authority as may be prescribed.
The return on the basis of which an assessment is to be made under section 14(1) of the Act is, therefore, a return filed within the prescribed period and in such a case the assessment has to be completed within a period of four years from the expiry of the year to which the assessment relates.
The return referred to in sub section ( 1) of section 14 of the Act cannot be a return filed beyond the prescribed date is emphasised by clause (i) of sub section (3) of section 14 of the Act which refers to a case where a dealer liable to pay tax fails to submit return before the date prescribed in that behalf.
All cases where the return is submitted beyond the prescribed date fall under sub section (3) of section 14 of the Act.
The scheme of the Act regarding the period within which assessments can be made is very simple.
Assessments in cases falling under sub section (1) of section 14 of the Act have to be completed within four years from the expiry of the year to which the assessment relates and assessments in cases falling under sub section (3) of section 14 of the Act may be completed within six years from the expiry of the year to which the assessment relates.
The two types of cases which fall under sub section (l) and sub section (3) of section 14 of the Act respectively are mutually exclusive.
When once it is established in case that a return has not been filed within the prescribed period such case falls outside section 14 ( l) of the Act and therefore the period of four years prescribed therein becomes automatically inapplicable.
It clearly falls under clause (i) of sub section (3) of section 14 of the Act and assessment can be made in such a case within the expiry of the period of six years.
While a dealer who files a return within the prescribed 743 period acquires immunity against assessment on the expiry of four years from the last day of the assessment year, a dealer who fails to file a return within the prescribed period has to wait for six years to be over to acquire such immunity.
Thus the Act confers a distinct advantage on a dealer who is prompt in filing his return.
We are not impressed by the argument that since the returns in the cases before us had been accepted even though they had been filed beyond the prescribed date the assessments made thereon cannot be considered as best judgment assessment and therefore sub section (3) of section 14 of the Act under which it is permissible to make best judgment assessments would be inapplicable.
The period within which assessments can be made under the Act does not depend upon the answer to the question whether the assessment in question is a best judgment assessment or it is an assessment made treating the return as correct and complete but it depends upon the other conditions mentioned in sub section ( 1) and in sub section (3) of section 14 of the Act.
We may here point out that even in a case falling under subsection (1) of section 14 of the Act it is possible for the assessing authority to make a best judgment assessment as can be seen from the latter part of the said sub section which reads: "but if the return appears to him to be incorrect or incomplete he shall after giving the dealer a reasonable opportunity of proving the correctness and completeness of the return submitted by him and making such inquiry as he deems necessary, assess to the best of his judgment, the amount of tax due from the dealer." Yet such best judgment assessment has to be completed within a period of four years from the expiry of the year to which the assessment relates.
Hence it cannot be held that merely because the assessments in question are not best judgment assessments sub section (3) of section 14 of the Act is inapplicable for best judgment assessments can be made both under sub section (1) and subsection (3) of section 14 of the Act.
That the assessment is a best judgment assessment is not, therefore, decisive of the question involved in these appeals.
The decision of the Andhra Pradesh High Court in the State of Andhra Pradesh vs Pyarelal Malhotra 13 S.T.C. 946 and the decision of this Court in the State of Madras vs S.G. Jayaraj Nadar & Sons 28 S.T.C. 700 which dealt with the question as to when a best judgment assessment could be made are not relevant for purposes of deciding the question which has arisen before us.
As we have already pointed out the question whether the assessment made is the best judgment assessment or not has no bearing at all on the period within which an assess 744 ment can be made under the Act.
Neither in the judgment of the High Court against which Civil Appeal No. 4448 of 1985 is filed nor in the judgment of the Tribunal out of which Civil Appeal No. 694 of 1986 arises adequate attention is given to the words 'before the date prescribed in that behalf in clause (i) of sub section (3) of section 14 of the Act.
The High Court and the Tribunal laid emphasis only on the words "fails to submit return" in the said sub clause and it is on this account they arrived at a wrong conclusion.
On a true construction of sub section (I) and sub section (3) of section 14 of the Act we are of opinion that where a return is not filed by a dealer before the date prescribed in that behalf under the Act, the assessing authority has got jurisdiction to complete the assessment within a period of six years from the expiry of the year to which the assessment relates.
Admittedly, in these cases the returns were not filed within the prescribed date and the assessments have been made within six years from the expiry of the year to which the assessments relate.
The orders of the High Court against which these appeals have been filed are therefore liable to be set aside.
In Civil Appeal No. 4448 or 1985 the judgment of the High Court is set aside and the judgment of the Tribunal is restored.
In Civil Appeal No. 694 of 1986 the order of the High Court and the judgment of the tribunal are set aside and judgment of the Assistant Commissioner (CT) Appeals, Warangal is restored.
The respondent shall pay the costs of the Appellant in both the appeals.
P.S.S. Appeals allowed.
[/INST]% The respondent Ram Chander ran a tailoring shop, employing about 10 to 12 tailors.
The number of his employees never exceeded 20.
At the shop, clothes were stitched and electric iron was used in the process of stitching and also for ironing the finished goods.
The dispute that arose for decision in the case was whether by virtue of Notification dated September 20, 1975, issued under Section 1(5) of the Employees ' State Insurance Act, 1943, the respondent 's establishment came within the purview of the Act.
Allowing the Appeal by special leave against the judgment and order of the High Court, and restoring the decision of the Employees ' State Insurance Court the Court, ^ HELD: Stitching process is carried on in the respondent 's establishment.
By stitching commercially, different goods with distinctive names, characters and uses are brought into existence.
If by a process, a different entity comes into existence, the process is a manufacture, as held by this Court in Empire Industries Limited & Ors. etc.
vs Union of India & Ors. etc.
, [1985] (Suppl.
1) SCR 292.
In the stitching process, ironing is an essential part, and for that electric power is used.
Also the respondent 's shop employed more than ten but less than 20 persons.
The respondent 's establishment clearly falls within the purview of the Employees ' State Insurance Act.
[837G H;838C] Deputy Commissioner, Sales Tax (Law) Board of Revenue (Taxes), Ernakulam vs Pio Food Packers, ; ; Chowgule & Co. Pvt. Ltd & Anr.
vs Union of India and others; , ; Ardeshir H. Bhiwandiwala vs The State of Bombay, [1961] 3 H 836 SCR 592; M/s. Hindu Jea Band, Jaipur vs Regional Director, Employees ' State Insurance Corpn.
Jaipur, ; ; Metro Readywear Company vs Collector of Customs, [1978] 2 Excise Law Times 520 and Employees ' State Insurance Corporation vs M/s. New Empire Tailores and others, (unreported) referred to.
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<s>[INST] Summarize the judgementN: Criminal Appeal No. 286 of 1973.
Appeal by Special Leave from the Judgment and Order dated 16 5 1973 of the Orissa High Court in Crl.
Revision No. 645 of 1972.
AND CIVIL APPEAL No. 2036 of 1973 Appeal by Special Leave from the Judgment and Order dated 6 3 1973 of the orissa High Court in O.J.C. No. 491/72.
J. L. Jain and Mrs. section Gopalakrishnan for or the Appellants.
G. Dass, Mrs. section Bhandare and A. N. Karkhanis for the Respondent.
The Judgment of the Court was delivered by KOSHAL, J.
By this judgment we shall dispose of Civil Appeal No. 2036 of 1973 and Criminal Appeal No. 286 of 1973, both of which have arisen from a dispute over a single piece of land and the facts leading to which may be briefly stated.
Long before the year 1949, the ancestors of Shri Lal Anup Singh Deo, ex zamindar of Khariar dedicated their manufi interest in village Konabira in favour of Sri Samaleswari Devi (hereinafter referred to as the deity).
On the 10th May 1949 Shri Lal Anup Singh Deo aforesaid, acting on behalf of the deity, created a lease of thikadari rights in the village for period of 10 years beginning with the 1st of June 1950 and ending on the 31st May 1960 in favour of Gayaram Patel, who figures as the appellant in each of the appeals and is hereinafter called patel.
The deed of lease appears at pages 5 and 6 of the paper book in Civil Appeal No. 2036 of 1973 and describes Patel thus: "Gayaram Patel son of Bisram Patel, the legal guardian of gaontia thikadari patta" The terms on which the lease was granted to Patel are reproduced below : (i) That the yearly rent payable shall be Rs. 109/ to be paid before January of every year.
322 (ii) That in case of non payment the lease is liable to be cancelled.
(iii)That all the repairs, upkeep and development works should be executed and for such works no compensation can be claimed.
All the repairs, maintenance of tanks, garden, buildings, etc., shall be carried out at your responsibility.
(iv) That no injustice should be done to the community in maintaining the abovementioned works.
(v) That no transfer is permissible in respect of the property.
(vi) That the property is to be maintained for the exclusive welfare of the community with the help, directions, orders and co operation of the Estate Officer.
(vii)That the rules and regulations for forest lands are to be obeyed.
(viii)That the cultivable lands cannot be utilised for any other purpose, nor can they be transferred or sold or otherwise dealt with to the hardship of the villagers or the tenants.
If any land is abandoned and (?) takes a new land for cultivation he will be liable under the law and be subjected to the payment of the usual rent.
The lease was acted upon and while it was in force, the orissa Estates Abolition Act, 1951 (hereinafter called the Abolition Act) was promulgated.
The object of that Act was to abolish all intermediaries and rent receivers, to vest their interest in the State, and to establish a direct relationship between the State and the tillers of the soil.
Section 3A of the Abolition Act authorised the State Government to declare by notification that such interests have passed to and become vested in the State free from all encumbrances.
A notification of that type was issued by the State Government and became effective from the 1st of June 1959.
In the meantime a Board of Trustees had been appointed under the Orissa Hindu Religious Endowments Act, 1951 (for short Endowments Act) with Shri Kailash Chandra Panigrahi as the Managing Trustee to look after the affairs of the deity on whose behalf an application under section 7 read with section 8 A(1) of the Abolition Act was made by the Managing Trustee after the said 323 notification had come into force.
It was claimed in the application that the deity was in "Khas possession" of certain lands in village Konabira and prayed that the same, be settled on it as an occupancy tenant.
The application was resisted by Patel who claimed that it was he and not the deity who enjoyed the "Khas possession" of the said land.
The application was decided by the Tehsildar Khariar, Tehsil Nawapara, acting as Collector under the Abolition Act.
He held that Patel was in "Khas possession" of only one plot of land which was designated by No. 5 and had an area of 20.14 acres but that such possession was held by him on behalf of the deity and not on his own account.
In this view of the matter he passed the order dated 13th June 1962, the operative part of which runs thus: "Sir lands in village Konabira bearing plot No. 5 with an area of 20.14 acres are settled on occupancy rights with Gayaram Patel s/o Bisram Patel, ' of Konabira, P. section Komna Distt.
Kalahandi for and on behalf of Samaleswari Devi of Kemna, the Maufidar, u/s 7(1) (b) of the Orissa Estates Abolition Act, 1951.
A fair and equitable annual rent of Rs. 6.75 np.
is determined from the date of vesting release rent from 1959 60 onwards.
" On the 21st of October 1963, the Managing Trustee of the deity made an application to the Assistant Commissioner of Endowments under section 68 of the Endowments Act complaining that he had been resisted by Patel in obtaining possession of the land of the deity and praying for recovery of possession thereof from Patel.
In his order dated the 12th of January 1970, the Assistant Commissioner of Endowments allowed the application holding that it was the deity and not Patel who had been declared to be the occupancy tenant in the order dated 13th June 1962 abovementioned.
Patel went up in revision to the Commissioner of Endowments but without success and thereafter knocked at the door of the orissa High Court with a petition under Articles 226 and 227 of the Constitution of India seeking to have the orders of the Assistant Commissioner of Endowments and the Commissioner of Endowments set aside.
The High Court however took the same view of the matter as was expressed by authority appointed under the Endowments Act and negatived the contentions raised on behalf of Patel, in its order dated 6th March 1973.
It is that order which is challenged before us in Civil Appeal No. 2036 of 1973 instituted by special leave.
In the meantime litigation had started between the deity and Patel on the criminal side also.
Claiming that the deity had recovered 324 possession of plot No. 5 abovementioned (which had by then come to be designated by No. 15 and to have an area of 22.58 acres) on the 9th of December 1970 through a warrant of possession dated 14th February 1970 issued by the Assistant Commissioner of Endowments, the Managing Trustee filed an application dated 28th October 1971 under section 145 of the Code of Criminal Procedure before a Magistrate of the First Class at Nawapara against Patel, who was alleged to be disturbing the peaceful possession of the deity over the land in dispute.
A Preliminary order attaching the property was passed by the Magistrate on the same day, i.e., 28th October 1971.
That order was however cancelled and the proceedings were dropped on the 15th November 1971 in pursuance of a report dated 6th November 1971 made by the officer incharge of the Police Station, Komna (within the territorial limits of which lay the land in dispute) to the effect that there was no apprehension of a breach of peace by the parties.
Nevertheless, on the 20th November 1971, another report was received by the Magistrate from the same officer revealing "an emergency" whereupon the Magistrate made a direction that the preliminary order dated 28th October 1971 be given effect to and that the land be attached along with the crops standing thereon.
Ultimately, the proceedings were finalised through an order dated 21st September 1972 passed by the Magistrate who held that it was Patel who was in possession of the land in dispute on the 20th November 1971, and directing that the land be restored to him.
Aggrieved by the order of the Magistrate the Managing Trustee or the deity went up in revision to the High Court, a learned Single Judge of which set aside the same and directed delivery of possession of the land to the deity on the basis of the findings given below: (1) The proceedings had terminated on the 15th November 1971 and the Magistrate has no jurisdiction to revive them five days later and to give effect to the order of attachment which already stood vacated.
(2) There had been a civil suit and a writ application in respect of the land which has terminated in favour of the deity.
(3) The matter had been taken up by the Endowments Department which had delivered all properties to the deity before the 29th April 1970.
It is this order of the High Court which is impugned in Criminal Appeal No. 286 of 1973 by special leave of this Court.
325 2.
In order to appreciate the rival contentions of learned counsel for the parties it is necessary to make a reference to the relevant provisions of the Abolition Act and to determine the party in whom the occupancy tenancy vests under section 7 thereof.
As already pointed out the object of the Abolition Act was to do away with all intermediaries and rent receivers and to establish a direct relationship between the State and the actual tillers of the soil.
The preamble of the Act states: "Whereas in pursuance of the Directive Principles of State Policy laid down by the Constitution of India it is incumbent on the State to secure economic justice for all and to that end to secure the ownership and control of all material resources of the community so that they may best subserve the common good, and to prevent the concentration of wealth and means of production to the common detriment; "AND WHEREAS in order to enable the state to discharge the above obligation it is expedient to provide for the abolition of all the rights, title and interest in land of Intermediaries by whatever name known, including the mortgagees and lessees such interest, between the raiyat and the State of Orissa for vesting in the said State of the said rights, title and interest and to make provision for other matters connected with;. " Section 2 contains definitions.
Clauses (f), (g), (h), (hh) and (j) thereof are relevant to the dispute and are extracted below: (f) "date of vesting" means in relation to an estate vested in the State the date of publication in the Gazette of the notification under sub section (1) of section 3 or sub section (1) of section 3 A in respect of such estate and in the case of surrender by an intermediary under section 4 the date of the execution of the agreement; (g) `estate ' includes a part of an estate and means any land held by or vested in an Intermediary and included under one entry in any revenue roll or any of the general registers of revenue paying lands and avenue free lands, prepared and maintained under the law relating to land revenue for the time being in force or under any rule, order, custom or usage having the force of law, and includes revenue free 326 lands not entered in any register or revenue roll and all classes of tenures or under tenures and any Jagir, inam or maufi or other similar grant; (h) `Intermediary ' with reference to any estate means a proprietor, sub proprietor, landlord, landholder, malguzar, thikadar, gaontia, tenure holder, under tenure holder, and includes an inamdar, a jagirdar, Zamindar, IIaquadar, Khorposhdar, Parganadar, Sarbarakar and Maufidar including the Ruler of an Indian State merged with the State of Orissa and all other holders or owners of interest in land between the raiyat and the State; (hh) `Intermediary interest ' means an estate or any rights or interest therein held or owned by or vested in an Intermediary and any reference to `state ' in this Act shall be construed as including a reference to `intermediary interest ' also; (j) "Khas possession" used with reference to the possession of an Intermediary of any land used for agricultural or horticultural purposes, means the possession of such intermediary by cultivating such land or carrying on horticultural operations thereon himself with his own stock or by his own servants or by hired labour or with hired stock; The provisions of section 3A have already been noted.
Then comes section 7 which is all important for the purpose of resolving the present dispute.
It states: "7.
(1) on and from the date of vesting (a) all lands used for agricultural or horticultural purposes which were in Khas possession of an Intermediary on the date of such vesting, (b) lands used for agricultural or horticultural purposes and held by a temporary lessee or lessees of an Intermediary who owns either as Intermediary or in any other capacity less than thirty three acres of land in total extent situated within the State, (c) lands used for agricultural or horticultural purposes and in possession of a mortgagee, which immediately before the execution of the mortgage bond were in Khas possession of such intermediary, 327 . . . . . . . . . . . . . . . shall, notwithstanding anything contained in this Act, be deemed to be settled by the State Government with such Intermediary and with all the share holders owning the estate and such Intermediary with all the share holders shall be entitled to retain possession thereof and hold them as raiyats under the State Government having occupancy rights in respect of such lands subject to the payment of such fair and equitable rent as may be determined by the Collector in the prescribed manner: . . . . . . . . . . . . . " Sub section (1) of section 8A requires Intermediaries to file their claims in the prescribed manner for settlement of fair and equitable rent in respect of land and buildings, which are deemed to be settled with them under section 6 or section 7, before the Collector within the specified period.
It would be seen that clauses (a), (b) and (c) of sub section (1) of section 7 protect certain Intermediaries and thus form exceptions.
to the scheme of the Act which, generally speaking, conforms to the object detailed in the preamble.
In the present case we are not concerned with clause (c).
According to learned counsel for Patel his case falls within the ambit of clause (a).
It is claimed on his behalf that he was not merely a lessee or a temporary lessee under the deity but was a thikadar and, therefore, himself an Intermediary within the meaning of the definition of that word occurring in clause (h) of section 2 and that he being in "Khas possession" of the land in dispute on the date of vesting was an Intermediary described in clause (a).
On the other hand, for the deity it is argued that Patel was granted only a temporary lease in 1949, that he did not have any status better than that of a lessee, temporary or otherwise, and that therefore his case was covered by clause (b) and not clause (a) so that it was he deity who was entitled to be regarded as the occupancy tenant on and from the date of vesting.
The whole controversy thus turns round the position which Patel came to hold in respect of the land in dispute under the lease deed of 1949 and in order to assess that position it is necessary to refer to the lease deed dated 10th May 1949.
As noted earlier that deed itself describes Patel as "gaontia thikadari patta".
Learned counsel for the deity has contended that 328 this description is really not correct and that the conditions of the lease clearly make out a case of Patel being inducted into the land as an ordinary lessee who was to till the land against payment of rent.
The contention does not appear to us to have any force.
Apart from the description of Patel as "gaontia thikadari patta" the deed contains a sure indication of the nature of the tenure granted in condition (8) which states specifically: "That the cultivable lands cannot be utilised for any other purpose, nor can they be transferred or sold or otherwise dealt with to the hardship of the villagers or the tenants.
. . . . . . . . . . . . . . " The reference to tenants is of considerable significance and points to land being under the cultivation of persons other than Patel at the moment the lease was granted.
This state of affairs is incompatible with the grant of an ordinary lease to Patel.
The tenure granted in his favour was on the other hand one conferring on him a right to collect the rents from the tenants of the deity and in lieu thereof pay a fixed sum of Rs. 109/ per annum to it so that he was correctly described in the lease deed as a gaontia or thikadar, both of which expressions describe an Intermediary as distinguished from a raiyat or an actual tiller of the soil.
Once Patel is found to be an Intermediary his case must fall within clause (b) of sub section (1) of section 7 as it was he who had the "Khas possession" of the land now in controversy, according to the findings contained in the order dated 13th January 1962 passed by the Collector and mentioned above, which have not been shown to us to suffer from any infirmity.
And if that be so, the land must be held to have vested in him, and not in the deity, as an occupancy tenant under the provisions of that section.
In the result both the appeals succeed and are accepted, the order of the High Court impugned in each being set aside and it being directed that the possession of the land in dispute attached by the order of the Magistrate in the proceedings under section 145 of the Code of Criminal Procedure be delivered to Patel as an occupancy tenant under the State.
The parties are however left to bear their own costs throughout.
N.V.K. Appeal allowed.
[/INST]The ancestors of a former Zamindar dedicated their maufi interest in a village in favour of a deity.
Acting on behalf of the deity the ex zamindar created a lease of thikadari rights in the village in favour of the appellant for ten years.
The lease deed termed the appellant as "legal guardian of gaontia thikadari patta".
While the lease was in force the Orissa Estates Abolition Act, 1951 which sought to abolish all intermediaries in land and vest their interest in the State came into force.
The Act however protected certain intermediaries thereby carving out an exception to the scheme of the Act.
Meanwhile the Managing Trustee of the Board of Trustees appointed under the Orissa Hindu Religious Endowments Act, 1951 to look after the affairs of the deity filed a petition under section 7 of the Abolition Act claiming that the deity was in Khas possession of certain lands including the land lease to the appellant and prayed that the same be settled on the Board of Trustees as an occupancy tenant.
The question was eventually settled in favour of the Trustees and against the appellant.
In the Managing Trustee 's application under section 145 Cr.
P.C. asserting that the appellant was disturbing peaceful possession of the deity over the land, the Magistrate held that it was the appellant who was in possession of the land and directed that the land should be restored to him.
The High Court in revision set aside the order of the Magistrate.
In appeals to this Court the appellant contended that it was he and not the deity, who was the thikadar and therefore an intermediary within the meaning of the definition of that term in the Abolition Act and was in Khas possession of the land in dispute and so the land should be restored to him.
Allowing the appeals, ^ HELD: 1.
It was the appellant who had the Khas possession of the land, and therefore, the land must be deemed to have been vested in him, and not in the deity, as an occupancy tenant under the provisions of section 7 of the Abolition Act.
[328 F] 2.
Apart from the description of the appellant as gaontia thikadari patta, condition 8 contains a sure indication of the nature of the tenancy agreement.
It states "that the cultivable lands cannot be utilised for any other purpose nor can they be transferred or sold or otherwise dealt with to the hardship of the villagers or the tenants." [328 B C] 321 3.
The reference to tenants in this condition points to the land being under the cultivation of persons other than the appellant at the moment the lease was granted.
This position was incompatible with the grant of an ordinary lease to him.
The tenure granted in his favour was on the other hand one conferring on hint a right to collect the rents from the tenants of the deity and in lieu thereof pay a fixed sum to it.
He was, therefore, correctly described as gaontia or thinkdar, both of which expressions describe an intermediary as distinguished from a raiyat or an actual tiller of the soil.
[328 D E]
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<s>[INST] Summarize the judgementAppeal No. 166 (NL) of 1983.
the Award dated 19.4.1982 of the Labour Court, Haryana at Faridabad in Reference No. 227 of 198 1.
R.K. Jain, R.P. Singh, Aseem Malhotra, Ashish Verma, Manoj Goel, R.K. Khanna and Ms. Abha R. Sharma for the Appellant.
Dr. Anand Prakash, Ghosh for M/s Fox Mandal & Co. and Som Mandal for the Respondent.
The Judgment of the Court was delivered by K. RAMASWAMY, J.
This appeal by special leave is against the award of the Labour Court, Haryana at Faridabad dated April 19, 1982 which was published in the State Gazette on August 10, 1982.It upheld the termination of the appellant 's service as legal and valid.
The respondent, by its letter dated December 12, 1980 which was received by the appellant on December 19, 1980, intimated that the appellant wilfully absented from duty continuously for more than 8 days from December 3, 1980 without leave or prior information or intimation or previous permission from the management and, therefore, "deemed to have left the service of the company on your own account and lost your lien and the appointment with effect from December 3, 1980.
" In support thereof reliance was placed on clause 13 (2) (iv) of its Certified Standing Order.
The appellant averred that despite his reporting to duty on December 3, 1980 and everyday continuously thereafter he was prevented entry at the gate and he was not allowed to sign the attendance register.
He pleaded that he was not permitted to join duty without assigning any reasons.
His letter of December 3, 1980 was marked herein as Annexure 'A ' wherein he explained the circumstances in which he was prevented to join duty.
The Tribunal found that the appellant had failed to prove his case.
The action of the respondent is in accordance with the standing Orders and it is not a termination nor retrenchment under the for short 'the Act '.
The appellant in terms of standing orders lost his lien on his appointment and so is not entitled to reinstatement.
Clause 13 (2) (iv) standing order reads thus: "If a workman remains absent without sanctioned leave or beyond the period of leave originally granted or subsequently extended, he shall lose his lien on his 936 appointment unless.
(a) he returns within 3 calander days of the commencement of the absence of the expiry of leave originally granted or subsequently extended as the case may be; and (b) explains to the satisfaction of the manager/management the reason of his absence o r his inability to return on the expiry of the leave, as the case may.
The workman not reporting for duty within 8 calander days as mentioned above, shall be deemed to have automatically abandoned the services and lost his lien on his appointment.
His name shall be struck off from the Muster Rolls in such an eventuality.
" A reading thereof does indicate that if a workman remains absent without sanction of leave or beyond the period of the leave originally granted or subsequently extended the employee loses his lien on employment unless he returns to duty within eight calander days of the commencement of the absence or the expiry of leave either originally granted or subsequently extended.
He has to give a satisfactory explanation to the Manager/Management of his reasons for absence or inability to return to the duty on the expiry of the leave.
On completion of eight calander days ' absence from duty he shall be deemed to have abandoned the services and lost his lien on his appointment.
Thereafter the management has been empowered to strike off the name from the Muster Rolls.
Section 2(oo) of the Act defines 'Retrenchment ' means the termination by the employer of the service of a workman for any reason whatsoever, otherwise than as a punishment inflicted by way of disciplinary action, but does not include (a) voluntary retirement of the workman, or (b) retirement of the workman on reaching the age of superannuation of the contract of employment between the employer and the workman concerned contains a stipulation in that behalf, or (c) termination of the service of a workman on the ground of continued ill health.
" Section 25F prescribes mandatory procedure to be followed before the retrenchment becomes valid and legal and violation thereof visits with invalida 937 tion of the action with consequential results.
In Punjab Land Development and Reclamation Corporation Ltd., Chandigarh vs Presiding Officer, Labour Court, Chandigarh and Ors., the Constitution Bench considered the scope of the word 'retrenchment ' defined by s.2(oo) and held in para 71 at page 716 that "analysing the definition of retrenchment in Section 2(oo) we find that termination by the employer of the service of a workman would not otherwise have covered the cases excluded in Clauses (a) and (b) namely, voluntary retirement and retirement on reaching the stipulated age of retirement or on the grounds of continued ill health.
There would be no violational element of the employer.
Their express exclusion implies that those would otherwise have been included".
In para 77 at page 719 it was further held that "right of the employer and the contract of employment has been effected by introducing Section 2(oo)".
The contention of the management to terminate the service of an employee under the certified standing Orders and under the contracts of employment was negatived holding that the right of the management has been effected by introduction of section 2(oo) and section 25F of the Act.
The second view was that the right as such has not been effected or taken away, but only an additional social obligation has been imposed on the employer to abide by the mandate of section 25F of the Act to tide over the financial difficulty which subserves the social policy.
This court relied on the maxim Stat pro ratione valuntas populi; the will of the people stands in place of a reason.
In paragraph 82 at page 722 this court concluded that the definition in s.2(oo) of the Act of retrenchment means "the termination by the employer of the service of a workman for any reason whatsoever except those expressly excluded in the section".
Same view was taken by three benches of three Judges of this Court in State Bank of India vs Sri N. Sundara Mani; ; ; Delhi Cloth & General Mills Lid.
vs Shambhu Nath Mukherjee & Ors ; and Hindustan Steel Ltd. vs The Presiding Officer.
Labour Court ; and two benches of two judges in Robert D 'Souza vs Executive Engineer, Southern Railway and Anr. ; and H. D. Singh vs Reserve Bank of India and Ors.
[1985] 4 SCC 201 took the same view.
Therefore, we find force in the contention of Sri R. K. lain, the learned Senior counsel for the appellant that the definition 'retrenchment ' in S.2(oo) is a comprehensive one intended to cover any action of the management to put an end to the employment of an employee for any reason whatsoever.
We need not, however, rest our conclusion on this point as in our considered view it could be decided on the other contention raised by Sri Jain that the order is violative of the principles of natural justice.
We are impressed with that argument.
Before dealing with it, it is necessary to dispose of inter related contentions raised by Dr. Anand Prakash.
938 The contention of Dr. Anand Prakash that since this appeal was deleted from the constitution bench to be dealt with separately, the finding of the constitution bench deprived the respondent of putting forth the contention based on Cl. 13 of the certified standing order to support impugned action and the respondent is entitled to canvass afresh the correctness of the view of the constitution bench is devoid of force.
It is settled law that an authoritative law laid after considering all the relevant provisions and the previous precedents, it is no longer open to be recanvassed the same on new grounds or reasons that may be put forth in its support unless the court deemed appropriate to refer to a larger bench in the larger public interest to advance the cause of justice.
The constitution bench in fact went into the self same question vis a vis the right of the employer to fall back upon the relevant provision of the certified standing Orders to terminate the service of the workman/employee.
By operation of section 2(oo) the right of the employer under Cl.13(2) (iv), and the contract of employment has been effected.
Moreover in Ambika Prasad Mishra vs State of U.P. and Ors.
, ; at 72 23 para 5 & 6.
A constitution bench held that every new discovery or argumentative novelty cannot undo or compel reconsideration of a binding precedent.
It does not lose its authority 'merely ' because it was badly argued, inadequately considered and fallaciously reasoned.
In that case the ratio of this court on article 31A decided by 13 Judges bench in Keshwanand Bharti vs Union of India [1973] Suppl.
SCR was sought to be reopened but this court negatived the same.
His contention that expiry of eight days ' absence from duty brings about automatic loss of lien on the post and nothing more need be done by the management to pass an order terminating the service and per force termination is automatic, bears no substance.
The constitution bench specifically held that the right of the employer given under the standing Orders gets effected by statutory operation.
In Robert D ' Souza 's case (supra) in para 7, this court rejected the contention that on expiry of leave the termination of service is automatic and nothing further could be done.
It was further held that striking of the name from the rolls for unauthorised absence from duty amounted to termination of service and absence from duty for 8 consequitive days amounts to misconduct and termination of service on such grounds without complying with minimum prin ciples of natural justice would not be justified.
In Shambhunath 's case three Judges bench held that striking of the name of the workman for absence of leave itself amounted to retrenchment.
In H.D. Singh vs Reserve Bank of India & Ors.
(supra), this court held that striking of the name from the rolls amounts to an arbitrary action.
In State Bank of India vs Workmen of State Bank of India and Anr.[1991] 1 SCC 13, a two judge bench of this court to which one of us, K.R.S.,J. was a member was to consider the effect of discharge on one month 's notice or pay in 939 lieu thereof.
It was held that it was not a discharge simplicitor or a simple termination of service but one camouflaged for serious misconduct.
This court lifted the veil and looked beyond the apparent tenor of the order and its effect.
It was held that the action was not valid in law.
The principle question is whether the impugned action is violative of principles of natural justice.
In A.K. Kriapak and Ors.
vs Union of India & Ors., a Constitution bench of this court held that the distinction between quasi judicial and administrative order has gradually become thin.
Now it is totally clipsed and obliterated.
The aim of the rule of the natural justice is to secure justice or to put it negatively to prevent miscarriage of justice.
These rules operate in the area not covered by law validly made or expressly excluded as held in Col. J.N. Sinha vs Union of India & Anr.
[1971] 1 SCR 791.
It is settled law that certified standing orders have statutory force which do not expressly exclude the application of the principles of natural justice.
Conversely the Act made exceptions for the application of principles of natural justice necessary implication from specific provisions in the Act like Ss.25F; 25FF; 25FFF; etc, the need for temporary hands to cope with sudden and temporary spurt of work demands appointment temporarily to a service of such temporary workmen to meet such exigencies and as soon as the work or service are completed, the need to dispense with the services may arise.
In that situation, on compliance of the provisions of section 25F resort could be had to retrench the employees in conformity therewith particular statute or statutory rules or orders having statutory flavour may also exclude the application of the principles of natural justice expressly or by necessary implication.
In other respects the principles of natural justice would apply unless the employer should justify its exclusion on given special and exceptional exigencies.
The cardinal point that has to be borne in mind, in every case, is whether the person concerned should have a reasonable opportunity of presenting his case and the authority should act fairly, justly, reasonably and impartially.
It is not so much to act judicially but is to act fairly, namely ' the procedure adopted must be just, fair and reasonable in the particular circumstances of the case.
In other words application of the principles of natural justice that no man should be condemned unheard intends to prevent the authority to act arbitrarily effecting the rights of the concerned person.
940 It is a fundamental rule of law that no decision must be taken which will affect the right of any person without first being informed of the case and be given him/ her an opportunity of putting forward his/her case.
An order involving civil consequences must be made consistently with the rules of natural justice.
In Mohinder Singh Gill & Anr.
vs The Chief Election Commissioner & Ors.
at 308F the Constitution Bench held that 'civil consequence ' covers infraction of not merely property or personal right but of civil liberties, material deprivations and non pecuniary damages.
In its comprehensive connotion every thing that affects a citizen in his civil life inflicts a civil consequence.
Black 's Law Dictionary, 4th Edition, page 1487 defined civil rights are such as belong to every citizen of the state or country they include rights capable of being enforced or redressed in a civil action.
In State of Orissa vs Dr. (Miss) Binapani Dei & Ors., this court held that even an administrative order which involves civil consequences must be made consistently with the rules of natural justice.
The person concerned must be informed of the case, the evidence in support thereof supplied and must be given a fair opportunity to meet the case before an adverse decision is taken.
Since no such opportunity was given it was held that superannuation was in violation of principles of natural justice.
In State of West Bengal vs Anwar Ali Sarkar , per majority, a seven Judge bench held that the rule of procedure laid down by law comes as much within the purview of article 14 of the Constitution as any rule of substantive law.
In Maneka Gandhi vs Union of India,. 1, another bench of seven judges held that the substantive and procedural laws and action taken under them will have to pass the test under Art, 14.
The test of reason and justice cannot be abstract.
They cannot be divorced from the needs of the nation.
The tests have to be pragmatic otherwise they would cease to he reasonable.
The procedure prescribed must be just, fair and reasonable even though there is no specific provision in a statute or rules made thereunder for showing cause against action proposed to be taken against an individual, which affects the right of that individual.
The duty to give reasonable opportunity to be heard will be implied from the nature of the function to be performed by the authority which has the power to take punitive or damaging action.
Even executive authorities which take administrative action involving any deprivation of or restriction on inherent fundamental rights of citizens, must take care to see that justice is not only done but manifestly appears to be done.
They have a duty to proceed in a way which is free from even the appearance of arbitrariness, unreasonableness or unfairness.
They have to act in a manner which is patently impartial and meets the requirements of natural justice.
The law must therefore be now taken to be well settled that procedure prescribed for depriving a person of livelihood must meet the challenge of article 14.
941 and such law would be liable to be tested on the anvil of article 14 and the procedure prescribed by a statute or statutory rule or rules or orders effecting the civil rights or result in civil consequences would have to answer the requirement of article 14.
So it must be right,just and fair and not arbitrary, fanciful or oppressive.
There can be no distinction between a quasi judicial function and an administrative function for the purpose of principles of natural justice.
The aim of both administrative.
inquiry as well as the quasi .judicial enquiry is to arrive at a just decision and if a rule of natural justice is calculated to secure justice or to put it negatively, to prevent miscarriage of justice, it is difficult to see why it should be applicable only to quasi judicial enquiry and not to administrative enquiry.
It must logically apply to both.
Therefore, fair play in action requires that the procedure adopted must be just, fair and reasonable.
The manner of exercise of the power and its impact on the rights of the person affected would be in conformity with the principles of natural justice.
article 21 clubs life with liberty, dignity of person with means of livelihood without which the glorious content of dignity of person would be reduced to animal existence.
When it is interpreted that the colour and content of procedure established by law must be in conformity with the minimum fairness and processual justice, it would relieve legislative callousness despising opportu nity of being heard and fair opportunities of defence.
article 14 has a pervasive processual potency and versatile quality, equalitarian in its soul and allergic to discriminatory dictates.
Equality is the antithesis of arbitrariness.
It is, thereby, conclusively held by this Court that the principles of natural justice are part of article 14 and the procedure prescribed by law must be just, fair and reasonable.
In Delhi Transport Corpn.
vs D. T. C. Mazdoor Congress and Ors, [1991] Suppl.
1 SCC 600 this court held that right to public employment and its concomitant right to livelihood received protective umbrella under the can copy of articles 14 and 21 etc.
All matters relating to employment includes the right to continue in service till the employee reaches superannuation or until his service is duly terminated in accordance with just.
fair and reasonable procedure prescribed under the provisions of the constitution and the rules made under the provisions of the constitution and the rules made under proviso to article 309 of the Constitution or the statutory provisions or the rules, regulations or instructions having statutory flavour.
They must be conformable to the rights guaranteed in Part III and IV of the Constitution.
article 21 guarantees right to life which includes right to livelihood, the deprivation thereof must be in accordance with just and fair procedure prescribed by law conformable to articles 14 and 21 so as to be just, fair and reasonable and not fanciful, oppressive or at vagary.
The principles of natural 942 justice is an integral part of the Guarantee of equality assured by article 14.
Any law made or action taken by an employer must be fair,just and reasonable.
The power to terminate the service of an employee/workman in accordance with just, fair and reasonable procedure is an essential inbuilt of ' natural justice.
articles 14 strikes at arbitrary action.
It is not the form of the action but the substance of the order that is to be looked into.
It is open to the court to lift the veil and gauge the effect of the impugned action to find whether it is the foundation to impose punishment or is only a motive.
Fair play is to secure justice, procedural as well as substantive.
The substance of the order is the soul and the affect thereof is the end result.
It is thus well settled law that right to life enshrined under article 21 of the Constitution would include right to livelihood.
The order of termination of the service of an employee/workman visits with civil consequences of jeopardising not only his/her livelihood but also career and livelihood of dependents.
Therefore, before taking any action putting an end to the tenure of an employee/workman fair play requires that a reasonable opportunity to put forth his case is given and domestic enquiry conducted complying with the principles of natural justice.
In D. 7. C. vs D.
T.C. Mazdoor Congress and Ors.
(supra) the constitution bench, per majority, held that termination of the service of a workman giving one month 's notice or pay in lieu thereof without enquiry offended article 14.
The order terminating the service of the employees was set aside.
In this case admittedly no opportunity was given to the appellant and no enquiry was held.
The appellant 's plea put forth at the earliest was that despite his reporting to duty on December 3, 1980 and on all subsequent days and readiness to join duty he was prevented to report to duty, nor he be permitted to sign the attendance register.
The Tribunal did not record any conclusive finding in this behalf.
It concluded that the management had power under Cl. 13 of the certified Standing Orders to terminate with the service of the appellant.
Therefore, we hold that the principles of natural justice must be read into the standing order No. 13 (2) (iv).
Otherwise it would become arbitrary.
unjust and unfair violating articles 14.
When so read the impugned action is violative of the principles of natural justice.
This conclusion leads us to the question as to what relief the appellant is entitled to.
The management did not conduct any domestic enquiry nor given the appellant any opportunity to put forth his case.
Equally the appellant is to blame himself for the impugned action.
Under those circumstances 50 per cent of the back wages would meet the ends of justice.
The appeal is accordingly allowed.
The award of the Labour Court is set aside and the letter dated December 12, 1980 943 of the management is quashed.
There shall be a direction to the respondent to reinstate the appellant forthwith and pay him back wages within a period of three months from the date of the receipt of this order.
The appeal is allowed accord ingly.
The parties would bear their own costs.
N.P.V. Appeal allowed.
[/INST]The respondent company terminated the appellant 's services on the ground that since he had willingly absented from duty continuously for more than 5 days from December 3, 1980, without leave or prior information of intimation or previous permission of the management, he had been deemed to have left the service of the company on his own and lost the lien and the appointment with effect from December 3, 1980.
It relied on clause 13(2) (iv) of the Certified Standing Order in support of its action.
The appellant 's plea that despite his reporting to duty on December 3, 1980 and every day continuously thereafter, he was prevented entry at the gate and was not allowed to sign the attendance register and that he was not permitted to join duty without assigning any reasons, was not accepted.
The Labour Court upheld the termination order as legal and valid.
It held that the appellant had failed to prove his case, that the action of the respondent was in accordance with the Standing Orders and it was not a termination nor retrenchment under the and that the appellant in terms of Standing Orders lost his lien on his appointment and was not entitled to reinstatement.
Allowing the appeal of the employee, this Court HELD:1.1.
The action of the management in terminating the appellant 's service is violative of the principles of natural justice.
Under clause 13 (2) (iv) of Certified Standing Orders, on completion of eight calendar days ' absence from duty an employee shall be deemed to have abandoned the services and lost his lien on his appointment.
Thereafter, the management is empowered to strike off the name from the Muster Rolls.
But it is not correct to say that expiry of eight days ' absence from duty brings about automatic loss of lien on the post and nothing more need be done by the management to pass an order terminating the service and per force termination is automatic.
The prin ciples of natural justice must be read into the Standing Order No. 13 (2) (iv).
Otherwise, it would become arbitrary, unjust and unfair violating Article 14.
Keshwanand Bharti vs Union of India, and State Bank of India vs Workmen of State Bank of India and Anr. ; , referred to. 1.2.
In the instant case,admittedly,the management did not conduct any domestic enquiry nor gave the appellant any opportunity to put forth his case.
932 The Labour Court did not record any findings on the appellant 's plea that despite his reporting to duty on December 3,1980 and on all subsequent days and readiness to, join duty he was prevented from reporting to duty, nor he was permitted to sign the attendance register, but held that the management had power under clause 13 of the Certified Standing Orders to terminate the service of the appellant.
Under the circumstances, the award of the Labour Court is set aside.
The respondent should reinstate the appellant forthwith with 50 per cent of the back wages.
Certified Standing Orders have statutory force which do not expressly exclude the application of the principles of natural justice.
Conversely, the made exceptions for the application of principles of natural justice by necessary implication from specific provisions in the Act like Sections 25F, 25FF, 25FFF etc.
The need for temporary hands to cope with sudden and temporary spurt of work demands appointment temporarily, to a service of such temporary workmen to meet such exigencies and as soon as the work or service is completed, the need to dispense with the services may arise.
In that situation, on compliance of the provisions of Section 25F resort could be had to retrench the employees in conformity therewith.
Particular statute or statutory rules or orders having statutory flavour may also exclude the application of the principles of natural justice expressly or by necessary implication.
In other respects, the principles of natural justice would apply unless the employer should justify the exclusion on given special and exceptional exigencies.
Col. J.N. Sinha vs Union of India & Anr., [1971] 1 S.C.R. 791, relied on.
Application of the principles of natural justice that no man should be condemned unheard intends to prevent the authority to act arbitrarily affecting the rights of the concerned person.
No decision must be taken which will affect the right of any person without first being informed of the case and be given him/her an opportunity of putting forward his/her case.
An order involving civil consequences must he made consistently with the rules of natural justice.
It is not so much to act judicially but to act fairly, namely, the procedure adopted must he just, fair and reasonable in the particular circumstances of the case.
The procedure prescribed for depriving a person of livelihood must meet the challenge of Article 14 of the Constitution and such law would be liable to be tested on the anvil of Article 14.
The procedure prescribed by a 933 statute or statutory rule or rules or orders affecting the civil rights or result in civil consequences would have to answer the requirement of the Article.
The manner of exercise of the power and its impact on the rights of the person affected would be in conformity with the principles of natural justice.
Article 14 has a pervasive processual potency and versatile quality, equalitarian it its soul and allergic to discriminatory dictates.
Equality is the antithesis of arbitrariness.
Therefore, the principles of natural justice are part of Article 14 and the procedure prescribed by law must be right, just, fair and reasonable and not arbitrary, fanciful or oppressive.
Mohinder Singh Gill & Anr.
vs The Chief Election Commissioner & Ors. ; State of Orissa vs Dr. (Miss) Binapani Dei & Ors.
, ; ; State of West Bengal vs Anwar Ali Sarkar, ; and Maneka Gandhi vs Union of India, [1978] 2 S.C.R. 621, relied on.
Blak 's law Dictionary 4th Edn.
p. 1487; referred to.
Article 21 of the Constitution clubs life with liberty, dignity of person with means of livelihood without which the glorious content of dignity of person would be reduced to animal existence.
When it is interpreted that the colour and content of procedure established by law must be in conformity with the minimum fairness and processual justice, it would relieve legislative callousness despising opportunity of being heard and fair opportunities of defence.
The order of termination of the service of an employee/workman visits with civil consequences of jeopardising not only his/her livelihood but also career and livelihood of dependents.
Therefore, before taking any action putting an end to the tenure of an employee/workman, fair play requires that a reasonable opportunity to put forth his case is given and domestic enquiry conducted complying with the principles of natural justice.
Delhi Transport Corpn.
vs D. T.C. Mazdoor Congress, and Ors., [1991] Suppl.
1 S.C.C. 600, relied on.
The aim of the rule of natural justice is to secure justice or to put it negatively to prevent miscarriage of justice.
These rules operate in the area not covered by law validly made or expressly excluded.
There can be no distinction between a quasi judicial function and an administrative function for the purpose of principles of natural justice.
The aim of both administrative inquiry as well as the quasi judicial enquiry is to 934 arrive, at a just decision and if a rule of natural justice is calculated to secure justice or to put it negatively, to prevent miscarriage of justice, it must logically be applicable both to quasi judicial enquiry and administrative enquiry and not only to quasi judicial enquiry.
A. K. Kriapak and Ors.
vs Union of India & Ors. , relied on.
An authoritative law laid after considering all the relevant provisions and the previous precedents is no longer open to be recanvassed on new grounds or reasons that may be put forth in its support unless the Court deemed it appropriate to refer to a larger bench in the larger public interest to advance the cause of justice.
Ambika Prasad Mishra vs State of U. P. & Ors. 10 and Keshwanand Bharti vs Union of India, , relied on.
The Constitution Bench in fact went into the self same question visa vis the right of the employer to fall back upon the relevant provision of the Certified Standing Orders to terminate the service of the workman/employee.
Therefore, it is not correct to say that since the present appeal was deleted from the Constitution Bench to be dealt with separately, the finding of the Constitution Bench deprived the respondent of putting forth the plea based on clause 13 of the Certified Standing Order to support the action in question and the respondent is entitled to canvass afresh the correctness of the view of the Constitution Bench.
The definition of 'retrenchment ' in Section 2(oo) of the is a comprehensive one intended to cover any action of the management to put an end to the employment of an employee for any reason whatsoever.
Punjab Land Development and Reclamation Corpn.
Ltd., Chandigarh vs Presiding Officer, Labour Court, Chandigarh and Ors., ; State Bank of India vs Sri N. Sundara Mani; , ; Delhi Cloth & General Mills Ltd. vs Shambhu Nath Mukherjee & Ors., [1978] 1 S.C.R. 591; Hindustan Steel Ltd. vs The Presiding Officer, Labour Court, ; Robert D ' Souza vs Executive Engineer Southern Railway, and Anr., ; and H.D. Singh vs Reserve Bank of India & Ors., [1985] 4 S.C.C.201, referred to. 935
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