judgement:
Appeal No.110 of 1961.
Appeal by special leave from the judgment and order dated October 14, 1960, of the Allahabad High Court in First Appeal from Order No. 41 of 1959.
C. B. Agarwala, Rameshwar Nath, section N. Andley, J. B. Dadachanj and P. L. Vohra, for the appellant.
K. B. Choudhuri, A. K. Kirty and Ratna Rao, for respondent No. 1. 870 section P. Sinha and M. I. Khawaja, for respondents Nos. 2, 3 and 4.
H. N. Sanyal, Additional Solicitor General of India and G. C. Mathur, for respondent No. 5.
Naunit Lal, for respondent No. 7. 1961.
April 11.
The, Judgment of the Court was delivered by SUBBA RAO, J.
This appeal by special leave is directed against the judgment dated October 14, 1960, of the High Court of Judicature at Allahabad confirming the order passed by the Civil Judge, Agra, directing the Official Receiver to take possession of the property of the appellant.
This case illustrates how the enforcement of an interlocutory order appointing a Receiver made in the interest of all the parties concerned could be obstructed and the object of the order itself be defeated by dilatory tactics adopted by one party or other.
At Agra, there were three spinning mills and one flour mill, all of which together were described as the Johns Mills; and, originally, the John family or their predecessors were the owners of all these mills.
At the time the present proceedings were initiated, other persons had acquired interest therein.
The following persons were the joint owners of the mills: (1) Hiralal Patni, the appellant, and Munni Lal Mehrt. 19/40th share; (2) Gambhirmal Pandiya Private Ltd. 8/40th share; (3) Messrs. John & Co . 11/40th share; and (4) I.E. John . 2/40th share.
Seth Loonkaran Sethiya, respondent No. 1, advanced large amounts to Messrs. John & Co. on the security of its business assets and stocks.
On April 18, 1949, the said Sethiya filed 0.
section No. 76 of 1949 in the Court of the Civil Judge, Agra, against John & Co. for the recovery of the amount due to him by sale of the assets of the said company.
To that suit the partners of Messrs. John & Co., for convenience described as "defendants 1st set", and the partners of Messrs. Johns Jain & Co., who were for convenience described as "defendants 2nd set", were made parties.
Pending the suit, the said Sethiya filed an application, under O. XL, r. 1, Code of Civil 871 Procedure, for the appointment of a Receiver.
By an order dated May 21, 1949, the learned Civil Judge appointed two joint Receivers and directed them to run the three spinning mills.
Hiralal Patni filed an appeal against that order to the High Court at Allahabad, and the said Court by its order dated August 22, 1949, modified the order of the Civil Judge confining the order of appointment of Receivers only to the share of Messrs. John & Co. in John Jain Mehre & Co. Loonkaran Sethiya made another application in the Court, of the Civil Judge for the appointment of a Receiver for the property of Hiralal Patni and the learned Civil Judge by his order dated December 1, 1951, directed the Receivens to take possession of the appellant 's share in the mills also Against this order an appeal was preferred to the High Court and the operation of the said order was stayed pending the disposal of the appeal.
On April 5, 1954, the Civil Judge passed a preliminary decree against the defendants therein directing them to deposit the decree 'amount in court within the prescribed time, and in default the plaintiff was given a right to apply for a final decree for sale of the business assets of the defendants.
The decree also gave a right to apply for a personal decree in case the sale proceeds were not sufficient to discharge the decree.
The preliminary decree directed that the Receivers should continue on the property until discharged.
Hiralal Patni preferred a appeal to the High Court against the said preliminary decree and applied for interim stay of its operation.
On August 23, 1955, the High Court discharged the Receiver,,; appointed by the learned.
Civil Judge, and appointed another Receiver in their place.
On March 25, 1955, the learned Civil Judge prepared a scheme for running the mills, and the parties preferred appeals against that scheme to the High Court.
The said appeals were compromised and under the term , of the compromise the parties agreed to take different mills on lease for a period of three years from the Receiver.
On January 14, 1956, the Receiver executed a lease in respect of the flour mill in favour of Hiralal Patni for a 872 period of three years.
Under the lease deed it was agreed that he should deliver the demised premises to the Receiver upon the expiry of the term.
In due course, on March 14, 1956, a final decree was made in the suit for the sale of the properties, but the final decree was silent in regard to the Receiver appointed earlier.
On September 29, 1958, Hiralal Patni applied to the High Court for extension of the lease by three years.
On January 16, 1959, the High, Court rejected the application on the ground that the lease was only a stopgap arrangement and that it was for the Receiver to make a fresh arrangement for the future under the supervision and directions of the Civil Judge, Agra.
On January 17, 1959, the Receiver applied to the Civil Judge for instructions whether he should proceed at once to dispossess the appellant.
On notice, Hiralal Patni raised various objections and claimed that he was entitled to remain in possession of the property as its owner.
The learned Civil Judge disallowed his objections and held that the Receiver derived his authority from the preliminary decree, and directed the Receiver to lease out the said flour mill by auction for a period of two years.
Pursuant to that order, an auction was held, and the appellant was the highest bidder, and he paid the lease amount and executed a formal lease deed.
Not satisfied with the order of the Civil Judge, Hiralal Patni preferred an appeal to the High Court.
The High Court in an elaborate judgment considered the contentions raised on behalf of Hiralal Patni and dismissed the appeal.
Hence the present appeal.
Learned counsel for the appellant raised before us the following three contentions, which the appellant, unsuccessfully raised before the High Court as well as before the Civil Judge.
(1) On a true construction of the relevant orders the Receiver has no power to dispossess the appellant in such a way as to prevent him from working his flour mill.
(2) After the passing of the final decree, though the Receiver may continue for the purpose of accounting and discharge of debts, he cannot exercise any powers in respect of the rights of the parties.
And (3) in any view, as the appellant 873 acquired a right under a lease deed and continued in possession after its expiry, he could be dispossessed only by a suit and not by a summary procedure.
The first question turns upon the construction of the relevant orders.
The Civil Judge appointed two joint Receivers by an order dated May 21, 1949.
It it not necessary to consider the said order as the final order that governed the rights of the Receiver and the parties was that made by the High Court on appeal on August 22, 1949.
After considering the contentions of the parties, the High Court came to the conclusion that a Receiver should be appointed to be in charge of the entire property, immoveable and move.
able, of the defendants 1st set for its protection and preservation.
The order of the High Court described the John family as defendants 1st set to the suit, and defendant 5, Hiralal Patni, defendant 6, Munnilal Mehra, and Messrs. John Jain Mehra & Co. as defendants 2nd set.
This order was confined only to the properties of defendants 1st set.
The High Court further proceeded to state: "In the finance agreement in plaintiffs favour, the plaintiff was not given any right to enter into possession on non payment or to run the mills.
There being no right given to the plaintiff to enter into possession and manage the mills or to have a receiver appointed, a receiver can be appointed only under Order 40, rule 1 of the Code of Civil Procedure.
" Adverting to the contention raised by the defendants that a Receiver could not be appointed to run the mills, the High Court observed: "In view of the order that we propose to pass today we do not want to go into that question.
In case the mills are not run under the order of the Collector under the United Provinces Industrial Disputes Act, or by the partners we propose to give the parties permission to move this court.
In case we decide to appoint a receiver to run the mills we shall then consider whether a receiver can or cannot be appointed for the purpose of running the mills.
" Then the High Court stated: 110 874 "We have already set out the circumstances which in our opinion make it necessary that a receiver should be appointed to take charge of the property of defendants first set whether under the finance agreement of July 1948 there was a charge created on the property, moveable and immoveable, or not.
The Receiver will not interfere with the running of the mills except under express orders of the Court and to the extent when it becomes necessary by reason of the value of the security being jeopardized by any action of the defendants.
" Then the High Court pointed out that the Collector had the power under section 3 of the Industrial Disputes Act to make arrangements for the running of the mills.
Finally the High Court observed: , "It may be necessary from time to time to give directions to the receiver.
The parties may also want portions 'of this order to be clarified or other directions obtained.
The lower court may give such directions to the receiver or to the parties as it may consider just and proper.
In case further directions are necessary or the receiver or the parties are not satisfied with the directions given they may move this court for further direction.
" Shortly stated, the High Court confirmed the order of the Civil Judge appointing the Receivers and directed them to take charge of the properties of defendants 1st set.
The High Court expressly prohibited the Receivers from interfering with the running of the mills except under express orders of the court, for at that time it did not think it necessary to direct the Receivers to do so.
It may be recalled that the Receivers were not appointed for the flour mill of the appellant, Hiralal Patni, as he was one of the defendants belonging to the 2nd set.
Learned counsel for the appellant contends that this order did not put the mills in the possession of the Receivers and that the Receivers were given only a supervisory control over the share of the defendants 1st set in the mills.
Whatever terminology may have been used, the fact remains that the Receivers were put in charge of the entire property 875 of defendants 1st set, which includes their share in the mills, though it was equally made clear that the Receivers could not directly run the mills without further directions in that regard.
The Civil Judge by his order dated December 1, 1951, directed the Receivers to take possession of 'the share of defendants 2nd set also.
The operative portion of that order reads: "For all these reasons I have come to the conclusion that it is just and convenient that a receiver should be appointed over the share of the defendant 11 set, and I order that the present receivers who are in possession of the defendant 1st set share should also be appointed receivers over the share of the defendant 11 set.
As for the prayer allowing the receivers to run the mills the question of running of the mills is already before the High Court as is shown by the compromise dated 8th September 1950.
It is not known what has happened after this compromise.
The receivers are directed to seek the direction of the Hon 'ble High Court on the question of the running of the mills so that there may be no chance of conflicting of orders passed by this court and the Hon 'ble High Court, on this matter.
The receivers will not interfere with the running of the mills except under express orders of this court and to the extent when it becomes necessary by reason of the value of the security being jeopardized by any action of the persons running the Mills.
The receivers are appointed over the share of the defendants II set only, for the purpose of preservation and protection and realization of the rent." This order runs on the same lines indicated by the High Court in its earlier order in respect of the share of defendants 1st set.
What is to be noted is that under this order the Receivers were prohibited from ' running the mills except under the specific ' orders of the said court or of the High Court.
On April 5, 1954, a preliminary decree was made in the suit, and under that decree the defendants were directed to deposit a sum of Rs. 18,00,152 in court within the prescribed 876 date and in default the plaintiff was given a right, to apply for a final decree for the sale of the assets of the spinning mills.
There was a further direction that in case the nett sale proceeds of the said property were found insufficient to satisfy the plaintiffs claim, the plaintiff would get a personal decree against defendants 1st set and defendants 2nd set for the balance of his claim.
The Receivers were directed to continue on the property until discharged.
Under the preliminary decree, the plaintiff became entitled not only to the sale of the assets of the spinning mills but also to a personal decree against all the defendants for recovering any balance that might still be due to him after the sale of the said properties.
What is more, the Receivers were expressly directed to continue till they were discharged, and as the decree did not specify the powers of the Receivers, it must be held that they continued to exercise such powers as they had under the previous, orders of the courts dated August 22, 1949 and December 1, 1951.
On March 25, 1955, the learned Civil Judge, Agra, prepared a scheme for the running of the three spinning mills, and the parties preferred two appeals to the High Court against the scheme.
On July 22, 1955, a compromise was effected between the parties in the aid two appeals and the appeals were disposed of in terms of the compromise by order of the High Court dated August 23, 1955.
As the terms of this order are rather important in the context of the contentions raised before us, we would read the relevant portions hereof: Clause 1.
That the aforesaid parties have without prejudice to their rights and litigation between them have after deliberate consideration and as a special effort to make arrangements for running the Johns Mill have decided that the three spinning Mills and Flour Mill situate in Agra should be run by the parties in accordance with the terms and conditions set forth below.
(vi) That the lease shall be granted by the receiver on terms and conditions approved by the Court.
877 (ix) If any lessee shall fail to run the Mill after delivery of possession or pay the lease money or fail to carry out the arrangements arrived at between the parties for a period of three months, the receiver shall take possession of the Mills and with the per mission of the court shall lease out that particular mill to any of the parties excepting the party in default who may offer the highest bid in accordance with the orders passed by the Civil Judge in this matter.
Clause, 4. . . . . .
The arrangement embodied in this document is only for the purpose of working the mills by the petitioners.
Nothing contained in this document will affect the rights and obligation of the parties which are or may be the subject matter of suit No. 76 of 1949 or in any litigation between the parties and notwithstanding anything contained herein but subject :however to the express provision in the preceding paragraph of this clause it will be open to the petitioners to seek their remedies in any manner provided by law, and without prejudice to the rights of the parties to obtain a stay order from the Hon 'ble High Court or any other Court.
" What is the effect of this order? Learned counsel for the appellant contends that this order embodies an internal arrangement between the defendants for running the mills and that it does not in any way enlarge the scope of the orders dated August 22, 1949, and December 1, 1951, under which the Receivers were appointed.
We do not think that the scope of the orders is so limited.
The combined effect of the said earlier orders was that the Receivers should take possession of the entire properties of the two sets of defendants.
But the Receivers were not given the power to run the mills without specific directions to that effect by the court.
The Civil Judge by his order dated March 25, 1955, evolved a scheme for running the mills, and by that order he laid down the conditions and directed the Receivers to advertise calling for applications from persons, including the Govern ment, who were willing to run the mills.
This order 878 was only confined to the three spinning mills.
The compromise order in the appeals covered also the flour mill.
Though different mills were to be run by different defendants by obtaining lease deeds, that was only a mode evolved for running the mills tinder the supervision of the court.
Under the compromise, the leases were to be executed in favour of the Receiver.
It also provided that in case the lessees did not carry out the terms of the lease, the Receiver should take possession of the mill in respect of which default was committed and, with the permission of the court, should lease out the mill to any of the defendants other than the defaulting party.
The clauses saving the rights of the parties obviously refer to their rights which were the subject matter of the suit and they could not have any reference to the terms agreed upon under the compromise order.
Under the compromise order, the courts, though by consent, gave directions for running the mills which they left out for future consideration in their earlier orders.
The result, was that under the earlier orders, all the properties of the defendants were put in possession of the Receivers, and under the compromise order, the Receiver was directed to run the mills under the agreed scheme.
Pursuant to the terms of the compromise order, on January 14, 1956, the Receiver executed a lease in favour of the appellant in respect of the flour mill for a period of three years, and under that lease deed the appellant got possession from the Receiver and agreed "To yield up all the demised premises with all fixture, improvement and replacements thereto in good and tenantable repair and condition in accordance with the lease covenants in that behalf herein contained upon the expiry of the term hereby created or the sooner determination of these presents as herein provided.
" Whatever ambiguity there may have been, this lease deed dispels it, for under the lease deed the appellant admits the legal possession of the Receiver, takes a lease under him, and agrees to put him back in possession after the expiry of the lease.
On September 29, 1958, the appellant again applied to the court for extension of the lease for three more years, thereby 879 accepting his possession under the Receiver, though the court on January 16,1959, dismissed that application on the ground that the lease was only a stopgap arrangement and that it was for the Receiver to make a fresh arrangement for the future under the supervision and directions of the Civil Judge under whose preliminary decree he derived authority.
It is manifest from the aforesaid orders that the Receiver was put in possession of the entire property of the defen dants, that he was not empowered to run the mills personally, that by subsequent orders he was directed to lease out the mills to the parties in the manner prescribed and that under the final order he was to take over possession and make other arrangements for running the mills.
In the premises, we find it very difficult to accept the argument of learned counsel that the Receiver was not put in possession of the mills, but the mills continued to be in the possession of tile defendants.
We hold on a construction of the relevant orders that the flour mill of the appellant was also put in the possession of the Receiver and that the appellant was running the said mill under the compromise formula.
The second contention of learned counsel for the appellant is that the Receiver appointed in the suit ceased to be a Receiver qua the rights of the parties when the final decree was made by the Court.
This contention leads us to the consideration of the question whether a Receiver appointed in a suit ceases to be such automatically on the termination of the suit.
Neither section 51(d) nor Order XL of the Code of Civil Procedure prescribes for the termination of the office of receivership.
We must, therefore, look for the solution elsewhere.
Some of the authoritative text books on receivers may usefully be consulted in this connection.
In Halsbury 's Laws of England, 3rd edn., Vol. 32 (Lord Simonds), at p. 386 under the heading "Duration of appointment by court", the following statement occurs: "When a receiver is appointed for a limited time, as in the case of interim orders, his office determines on the expiration of that time without any 880 further order of the court, and if the appointment is until judgment or further order ' it is brought to an end by the judgment in the action.
The judgment may provide for the continuance of the receiver, but this is regarded as a now appointment.
If a further order of the court, though silent as to the receivership, is inconsistent with a continuance of the receiver, it may operate as a discharge.
When a receiver has been appointed on an interlocutory application without any limit of time, it is not necessary to provide for the continuance of his appointment in the final judgment.
The silence of the judgment does not operate as a discharge of the receiver or determination of his powers.
So, also the appointment of a receiver generally by the judgment in an administration action need not be continued by the order on further consideration.
" In Kerr on Receivers, 12th edn., in chapter XII under the heading "Discharge of a Receiver", the legal position is explained thus: "The appointment of a receiver made previously to the judgment in an action will not be superseded by it, unless the receiver is appointed only until judgment or further order." In High on the Law of Receivers, 4th edn., the following observations appear at p. 985: , "The functions of a receiver usually terminate with the termination of the litigation in which he was appointed.
And when the bill upon which the appointment was made is afterwards dismissed upon demurrer, the duties of the receiver cease as between the parties to the action. . .
And although as between the parties to the litigation his functions have terminated with the determination of the suit, he is still amenable to the court as its officer until he has complied with its directions as to th e disposal of the funds which he has received during the course of his receivership. . .
But an order of discharge does not necessarily follow, in all.
cases, because of the determination of the suit, and the court may, upon sufficient cause shown, 881 either discharge or continue the receiver, according to the exigencies of the case.
" The learned author makes a further distinction at p. 986 between the following two classes of cases: "Since the final decree in the cause is generally decisive of the subject matter in controversy, and determines the right to the possession of the fund or property held by the receiver, it is usually the case that such decree supersedes the functions of the receiver, since there is then nothing further for him to act upon, although it would seem to be still necessary that a formal application be made for his discharge.
But when the court by its decree does not attempt to decide the main question in controversy, and leaves the receiver 's possession undisturbed, it cannot be held to have the effect of operating as a discharge, or of superseding his functions.
" Woodroffe in "The Law relating to Receivers in British India", 4th edn., states at p. 22 thus: O. XL, r. 1(a) now expressly provides that a receiver may be appointed whether before or after decree.
As long as the order appointing a receiver remains unreversed, and as long as the suit remains a lis pendens, the functions of the receiver continue, until he is discharged by order of the Court.
" The law may briefly be stated thus: (1) If a receiver is appointed in a suit until judgment, the appointment is brought to an end by the judgment in /the action.
(2) If a receiver is appointed in a suit, with.
out his tenure being expressly defined, he will continue to be receiver till he is discharged.
(3) But, after the final disposal of the suit as between the parties to the litigation, the receiver 's functions are usually terminated, he would still be answerable to the court as its officer till he is finally discharged. (4) The court has ample power to continue the receiver even after the final decree if the exigencies of the case so require.
Let us now apply the said principles to the facts of the instant case.
The order appointing the Receivers III 882 did not expressly state that the Receivers ' term would expire on the termination of the suit.
Under the preliminary decree the plaintiff became entitled to apply for the passing of the final decree for the sale of the property charged and also to get a personal decree against the defendants 1st set and 2nd set for the balance of his claim remaining due after the sale The preliminary decree expressly directed the Receivers to continue until discharged.
Pursuant to the preliminary decree, a final decree for sale of the said properties was made, but the said decree did not in any way modify the direction given in the preliminary decree in respect of the Receivers.
The combined effect of the two decrees is that the final decree did not terminate the suit, for the plaintiff would still be entitled to get a personal decree in case the sale proceeds were not sufficient to pay off his dues.
It cannot, therefore, be said that the suit has be finally an disposed of.
That apart, the preliminary decree in express terms directed the Receivers to continue till they were discharged.
In the circumstances, we are definitely of the opinion that the Receivers continued by the preliminary decree are entitled to function in that capacity till they are discharged.
The third contention of learned counsel for the appellant raises the question whether in the circumstances of this case the Receiver could recover possession from the appellant only by instituting a regular suit against him for eviction.
The facts germane to this contention may be briefly recapitulated.
On January 14, 1956, the appellant executed a lease deed in respect of the flour mill in favour of the Receiver and there was an express recital therein that the lessee would deliver possession to the Receiver of all the demised premises upon the expiry of the term of lease.
The said lease was executed as a part of a com promise scheme for running the mills.
The term of the lease had expired.
Thereafter the court directed the Receiver to take possession of the property and auction the same to the highest bidder.
The question is whether under the circumstances a court can dispossess the appellant under, a summary process or 883 whether it could only do so by directing the Receiver to file a suit for eviction.
The material provisions of Order XL of the Code of Civil Procedure read: Rule 1.
(1) Where it appears to the Court to be just and convenient, the Court may by order . . . . . . (b) remove any person from the possession or custody of the property; . . . . . . (d) confer upon the receiver all such powers, as to bringing and defending suits and for the realization, management, protection, preservation and improvement of the property, the collection of the rents and profits thereof (2) Nothing in this rule shall authorize the Court to remove from the possession or custody of property any person whom any party to the suit has not a present right so to remove.
Under this Order, a receiver is an officer or represen tative of the court and he functions under its directions.
The court may, for the purpose of enabling the receiver to take possession and administer the property, by order, remove any person from the possession or custody of the property.
Sub r.
(2) of rule 1 of the Order limits that power in the case of a person who is not a party to the suit, if the plaintiff has not a present right to remove him.
But when a person is a party to the suit, the court can direct the receiver to remove him from the possession of the property even if the plaintiff has not a present right to remove him.
In the present case, the appellant was a party to the suit and the court, through the Receiver took possession of the mill and thereafter the Receiver, during the course of the administration of the property, under a compromise arrangement for running the mills, leaned out the flour mill to the appellant with an express condition that the appellant should redeliver the property to the Receiver on the expiry of the lease.
Aamittedly the term of the, lease had expired, and the court directed the Receiver to take possession of the mill.
The court, in our view, 884 was legally competent to confer a power on the Receiver under Order XL, r. 1(1)(d), of the Code of Civil Procedure to recover the property from the appellant.
The decisions cited at the Bar are not of much relevance to the present case.
Krista Chandra Ghose vs Krista Sakha Ghose (1) is a case where a lease was granted by a Receiver acting under an order of court and the possession of the property had been given to the lessee, and subsequently certain parties applied to the court for a declaration that the lease was invalid on the ground that it was obtained by collusion.
There the court held that no summary order could be passed to set aside the lease and the proper remedy would be by a suit against the Receiver and also against the lessee.
In that case the lessee, though he was a party to the suit, acquired a leasehold right under the lease deed and third parties, who offered a higher rent, sought to question the lease on the ground of collusion.
Woodroffe, J., held that the dispute could only be decided in a properly instituted suit.
The Rajasthan High Court in Nanakchand vs Pannalal (2) held that a Receiver could not recover the rent from a lessee in a summary order of the court, but should file a suit just like any other landlord.
The Allahabad High Court in Loonkaran vs I. N. John (3), though it conceded that where a lease had been executed by the Receiver, the lessee may ordinarily be evicted from the demised property only by a regular suit, held that where after the expiry of the term of the lease granted by a Receiver, the sub.
lessee in possession gave an undertaking to the court that he would vacate the premises in favour of the prospective lessee if no fresh lease was granted in his favour, the court has power to eject the sub leessee in its summary jurisdiction.
The learned Judge observed at p. 59 thus: "By giving an undertaking to the court that he would vacate the Mill in favour of the prospective lessee and by bidding in the court auction the appellant, in our view, submitted himself to the (1) Cal.
(2) A.I.R. 1951 Raj.
(3) A.I.R. 1961 All.
885 jurisdiction of the court.
The appellant could therefore be ejected by summary process, instead of by a suit.
" So too, the High Court of Travancore Cochin in Sivarajan vs Official Beceiver, Quilon District (1) held that where the period of the lease granted to the receiver had already expired and as per the express stipulation in the lease deed the lessee was bound to surrender possession of the property without raising any objection at all, the Court could summarily evict him.
The learned Judge made the following observations at p. 39: "Even though the lease deed stands in favour of the receiver the express undertaking given by the lessee for an unconditional surrender of the property is in favour of the court. .
The summary enforcement of the undertaking thus taken by the court is only a, step towards the discharge of the duties of the court in the management of the estate and it cannot be said that the court has lost its jurisdiction in that direction merely because the property has been in the possession of a lessee.
" Further citation would be redundant.
These and such decisions seem to hold that a court cannot evict a lessee from a receiver, whether he is a party to the suit or not, in exercise of its summary jurisdiction unless the lease expressly conferred a right of re entry under the lease deed on the receiver.
It is not necessary to demarcate the boundaries of the summary jurisdiction of a court in managing an estate through a receiver, for in this case we are clearly of the opinion that the appellant was in possession of the mill under an agreed and integrated scheme for running the mills by the different partners, though he was put in possession under a document described as a lease deed.
In effect the Receiver, during the course of the management, entrusted each mill to one of the partners so that the mills might be properly worked under experienced hands.
The appellant expressly agreed to put the Receiver in possession of the mill after the expiry of three years.
No question of (1) I.L.R. 886 deciding the conflicting claims of a lessee and a third party arises in this case; nor is the court called upon to pronounce on the vested rights of a lessee in conflict with those of the Receiver.
But this is a simple case of a court in the course of its administration of the estate through the agency of a receiver making a suitable provision for the running of the mills.
As the agreed term had expired, the court, in our view, could certainly direct the appellant to put the mill in the possession of the Receiver.
Lastly it has been brought to our notice that an application for the discharge of the Receiver is pending in the lower court.
Any observations that we have made in this judgment are not intended to affect the merits one way or other in the disposal of that application.
That application will be disposed of in accordance with law.
In the result, the appeal fails and is dismissed with costs.
Appeal dismissed.

summary:
The John Mills comprising of three textile mills and one flour mill were jointly owned by several persons.
The financier of the Mills filed a suit for recovery of the amount due to him.
During the pendency of the suit a receiver was appointed to take possession of the flour mills but he was not empowered to run the mills directly without further directions of the court.
A preliminary decree was passed in the suit directing among other things that the receiver was to continue until discharged.
Thereafter, an arrangement was made for running the mills and the court directed that the appellant, who was one of the co owners of the mills, be given a lease of the flour mill for three years by the receiver.
In the lease deed the appellant undertook to deliver back possession to the receiver upon the expiry 869 of the three years.
Shortly thereafter, a final decree was passed in the suit but it was silent in regard to the receiver appointed earlier.
On the expiry of the three year term of the lease the court directed the receiver to take back possession of the flour mill from the appellant.
The appellant contended (i) that after, the passing of the final decree the receiver ceased to 'be a receiver in respect of the rights of the co owners and could not dispossess the appellant, and (ii) that the appellant could only be dispossessed by a suit filed by the receiver and not by a summary procedure.
Held, that the receiver continued by the preliminary decree was entitled to function till he was discharged.
The legal position with regard to the continuance of receivers is that: (i) if a receiver is appointed in a suit until judgment, the appointment is brought to an end by the judgment in the suit; (ii) if a receiver is appointed in a suit without his tenure being expressly defined, he will continue till he is discharged; (iii) even after the final disposal of the suit, though as between the parties to the suit his functions are usually terminated, the receiver con tinues to be answerable to the court till he is finally discharged, and (iv) the court has ample power to continue the receiver even after the final decree if the exigencies of the case so require.
The final decree in the present case did not finally dispose of the suit and did not bring the appointment of the receiver to an end.
Held, further that the court was entitled to direct the appellant to give back possession of the flour mill to the receiver.
The court was merely making suitable arrangement for the running of the mill in the course of its administration of the estate through the receiver.
The mill had been leased out to the appellant with an express condition that he should redeliver the property to the receiver on the expiry of the lease and the court was competent under 0.
4o r. 1(1)(d) Code of Civil Procedure to confer a power on the receiver to recover the property from the appellant.
It was not necessary for the receiver to file a suit for the recovery of the property.


judgement:
riminal Appeal No. 74 of 1960.
Appeal by special leave from the judgment and order dated August 8, 1957, of the Bombay High 897 Court at Rajkot in Criminal Revision Application No. 10 of 1956.
B. K. Khanna and T. M. Sen, for the appellant.
Rameshwar Nath, section N. Andley and P. L. Vohra, for the respondent.
April 12.
The Judgment of the Court was delivered by SUBBA RAO, J.
This appeal by special leave is against the order of the Bombay High Court at Rajkot setting aside the warrants of attachment issued by the First Class Magistrate, Jamnagar, for enforcing the penalty imposed on the respondent under section 193 of the , (hereinafter called the Act).
The material facts may be briefly stated.
The respondent is Digvijavasinhji Spinning & Weaving Mills Limited, Jamnagar.
It imported 275 cases of secondhand looms under one consignment and 175 cases of second hand textile waste to plant machinery under another consignment from Pondicherry.
The respondent held licences for import of goods of a lesser value than the value of these consignments.
The Collector of Customs, Baroda, ordered the said goods to be confiscated under section 167(8) of the Act; and in lieu of confiscation an option was given to the respondent to pay a fine of Rs. 22,918 and Rs. 16,000 in respect of the two consignments.
Further, on the ground that the respondent had understated the, value of the goods imported under the first consignment, the appellant imposed a penalty of Rs. 500 under section 167(37)(c)of the Act.
Against the said order,.
the respondent preferred two appeals to the Central Board of Revenue and the said Board by its order dated January 15, 1954, set aside the orders of the appellant and instead imposed a penalty of Rs. 22,918 in regard to the first consignment and Rs. 16,000 in regard to the other under section 167(8) of the Act; but the penalty of Rs. 500 was however maintained.
In revision the Government of India modified the order of the Central Board of Revenue by cancelling the penalty of Rs. 500 and in 898 other respects it confirmed the order of the said Board.
The respondent cleared the goods on executing a bond in favour of the appellant.
As the respondent did not pay the penalty, the appellant, acting under section 193 of the Act, notified the default in writing to the First Class Magistrate at Jamnagar so that the penalty might be recovered in the manner prescribed by the said section as if the said penalty was a fine inflicted by the Magistrate himself.
On the said requisition the Magistrate issued warrants of attachment against the respondent, but the latter filed a petition before him for the cancellation of the said warrants on the ground that the order of the Central Board of Revenue was illegal and also on the ground that the appellant had no jurisdiction to take action under section 193 of the Act.
The Magistrate, by his order dated May 8, 1956, held that the appellant could validly realize the said amounts under the machinery provided under section 193 of the Act.
Against the said order of the Magistrate the respondent preferred an appeal to the Sessions Judge, Halar, Jamnagar, but it was later converted into a revision and was dismissed.
On revision to the High Court against that order, the High Court held that as the panalty was imposed by the Central Board Revenue, the appellant could not realize the said amounts under 193 of the Act; it also expressed an opinion that the final order of the appellate authority was not without jurisdiction as it was not shown that consent of the owner of the goods ordered to be confiscated had not been obtained by the Central Board of Revenue before the order commuting the confiscation to penalty was passed.
In the result, the High Court set aside and cancelled the warrants of 'attachment issued by the Magistrate.
Hence the appeal.
Learned counsel for the appellant broadly contended that section 193 of the Act should be liberally construed with a view to effectuate the intention of the legislature and if so construed the order of the Central Board of Revenue made in substitution of that of an officer of Customs could be enforced by the latter officer under the said section.
On the other hand, 899 learned counsel for the respondent argued that the Central Board of Revenue was not an officer of Customs within the meaning of section 193 of the Act and therefore its order could not be enforced under the said section by an officer of Customs; and that even if the Board, being the Chief Customs Authority, could be considered to be an "officer of Customs" within the meaning of those words, the said Chief Customs Authority only could enforce the said order and not the Collector of Customs.
To appreciate the rival contentions and to provide a satisfactory solution to the problem presented it is necessary to read the relevant provisions of the Act, not only to understand the scheme of the Act but also to construe the provisions of section 193 thereof in the light of the scheme disclosed by the said provisions.
It is one of the well established rules of construction that "if the words of a statute are in themselves precise and unambiguous no more is necessary than to expound those words in their natural and ordinary sense, the words themselves in such case best declaring the intention of the legislature".
It is equally well settled principle of construction that "Where alternative constructions are equally open that alternative is to be chosen which will be consistent with the smooth working of the system which the statute purports to be regulating; and that alternative is to be rejected which will introduce uncertainty, friction or confusion into the working of the system.
" With this background and having regard to the aforesaid two principles of construction, let us at the outset scrutinize the scheme of the Act.
Section 3 defines "Chief Customs authority" to mean the Central Board of Revenue.
"Customs collector" is defined to include "every officer of Customs for the time being in separate charge of a custom house, or duly authorized to perform all, or any special, duties of an officer so in charge.
" Section 19 confers a power on the Central Government to prohibit or restrict the importation or exportation of goods by sea or by land.
Section 167 prescribes the various punishments for offences under the Act.
Section 167(8) says that if any goods, the 900 importation or exportation of which is for the time being prohibited or restricted by or under Chapter IV of the Act, be imported into, or exported from India contrary to such prohibition or restriction, such goods shall be liable to confiscation; and any person concerned in any such offence shall be liable to a penalty not exceeding three times the value of the goods, or not exceeding one thousand rupees.
Under section 167(37)(c), if it be found, when any goods are entered at, or brought to be passed through, a custom house, either for importation or exportation, that the contents of such packages have been misstated in regard to sort, quality, quantity or value, such packages shall be liable to confiscation and every person concerned in any such offence shall be liable to a penalty not exceeding one thousand rupees.
Section 182, empowers the Collector of Customs to adjudicate whether anything is liable to confiscation, increased rate of duty or any person is liable to a penalty.
Section 183 enjoins on such authority to give the owner of goods so confiscated an option to pay in lieu of confiscation such fine as it thinks fit.
Section 188 gives a right of appeal from such an order to the Chief Customs Authority who is empowered to pass such order as he thinks fit, confirming, altering or annulling the decision or order appealed against; but under the proviso to that section the said appellate authority cannot make an order subjecting any person to any greater confiscation, penalty or rate of duty than has been adjudged against him in the original decision or order.
Every order passed under this section is final subject to the power of revision conferred by section 191 on the Central Government.
Section 190 confers a power on the Chief Customs Authority to remit penalty, increased rate or confiscation in whole or in part; it also enables the said authority, with the consent of the owner of the goods ordered to be confiscated to commute the order of con fiscation to a penalty not exceeding the value of such goods.
Section 190A gives a power of revision to the Chief Customs Authority against an order of any officer of Customs passed under the Act and enables it to pass such order thereon as it thinks fit.
Then comes the 901 crucial section 193.
As the argument turns upon the provisions of this section, it would be convenient to read the entire section at this stage.
Section 193: "When a penalty or increased rate of duty is adjudged against any person under this Act by any officer of customs, such officer, if such penalty or increased rate be not paid, may levy the same by sale of any goods of the said person which may be in his charge or in the charge of any other officer of Customs.
When an officer of Customs who has adjudged a penalty or increased rate of duty against any person under this Act is unable to realise the unpaid amount thereof from such goods, such officer may notify in writing to any Magistrate within the local limits of whose jurisdiction such person or any goods belonging to him may be, the name and resi dence of the said person and the amount of penalty or increased rate of duty unrecovered; and such Magistrate shall thereupon proceed to enforce payment of the said amount in like manner as if such penalty or increased rate had been a fine inflicted by himself.
" Pausing here, let us recapitulate the gist of the aforesaid provisions.
Under the Act the goods, whose importation or exportation is prohibited or restricted by the provisions of the Act, are liable to be confiscated and also the person concerned is liable to a penalty.
Even a misstatement in regard to sort, quality, quantity or value of the goods so imported or exported is an offence and the packages, with their contents, are liable to be confiscated and the person concerned in any such offence is also liable to penalty.
The Collector of Customs can make an order confiscating the said goods as well as imposing a penalty on the person concerned.
In an appeal against that order, the Chief Customs Authority can modify the said order, but it has no power to increase the burden.
It can remit such penalty or confiscation, in whole or in part, but it can also commute the order of confiscation to penalty not exceeding the value of such goods.
A person desiring to file an appeal against an order of 902 penalty passed by an officer of Customs shall, pending an appeal, deposit in the hands of the Customs collector at the port where the dispute arises the amount demanded by the officer passing such decision or order; and if he succeeds wholly or in part, the whole or such part thereof, as the case may be, shall be returned to him.
The result of the provisions, therefore, is that there would never be a contingency or necessity for an appellate tribunal to enforce payment of penalty impossed by it, for no appeal would be heard by it unless the penalty was deposited as aforesaid.
With this background let us look at the relevant provisions of section 193 of the Act.
Under the said section only an officer of Customs, who has adjudged a penalty or increased rate of duty, can realize the said penalty or rate through the machinery of a Magistrate.
The question is whether the Chief Customs Authority is "an officer of Customs" who has adjudged a penalty or rate, as the case may be, within the meaning of section 193 of the Act.
Section 182 of the Act enumerates the different officers of Customs who are empowered to adjudge a question of penalty, but the Chief Customs Authority is not included in that list.
Indeed, in section 182(c) the Chief Customs Authority is empowered to nominate the subordinate officers of Customs to adjudge questions within certain pecuniary limits.
That apart, section 3(a) of the Act defines "Chief Customs authority" to mean the Central Board of Revenue.
The Central Board of Revenue is a statutory authority and, though it can only function through officers appointed to the said Board, it is inappropriate to call it an officer of Customs.
In this situation, when under the provisions of the Act there is no scope for realization of any penalty imposed for the first time by the Chief Customs Authority, it would be more in accord.
with the scheme of the Act to construe the words "an officer of Customs" as an officer of the Customs who is authorized to adjudicate in the first instance on the question of confiscation, increased rate of duty or penalty under section 182 of the Act.
This construction, it is said, would lead to ail anomaly of the statute conferring a power on the Chief Customs Authority to 903 from it a procedure to enforce its collection.
As we have pointed out, such an anomaly cannot arise under the provisions of the Act, for there is no section which empowers the Chief Customs Authority to impose a penalty higher than that imposed by the Customs Officer.
Assuming that the Chief Customs Authority is an Officer of Customs within the meaning of section 193 of the Act, it had to initiate proceedings under the said section; but in this case the Collector of Customs notified in writing to the Magistrate for recovering the said penalty.
Learned counsel for the appellant contends that an order made by the Chief Customs Authority imposing a penalty shall be deemed in law to be an order made by the original authority, that is, the Collector of Customs and, therefore, the said order for the purpose of enforcement shall be treated as the order of the Collector of Customs.
It is said that this legal position would flow from the proposition that an appeal is a continuation of a suit.
The said proposition is unexceptionable: see Rangaswamy vs Alagayammal (1), Kristnamachariar vs Mangammal (2), Lachmeshwar Prasad Shukul vs Keshwar Lal Chaudhuri (3).
But neither the said decisions nor the principles laid down therein can have any bearing on the question whether an order made for the first time by an appellate authority could in law be deemed to be one made by the original authority.
In the absence of any statutory fiction giving rise to that result, it is not permissible to treat the order made by one authority as that made by another authority.
If so, it follows that the order of the Chief Customs Authority imposing a penalty for the ' first time cannot be treated to be an order of the Collector of Customs within the meaning of section 193 of the Act.
As we have pointed out, the Chief Customs Authority has no power to impose a penalty for the first time under section 188 of the Act; but it has power under (1) A.I.R. 1915 Mad. 1133.
(2) Mad.
91,95 96.
(3) , 10.3.
904 s.190 of the Act to commute the order of confiscation to a penalty riot exceeding the value of the goods confiscated.
Though the Chief Customs Authority in its order dated January 15, 1954, did not expressly rely on section 190 of the Act, it cannot be disputed that it has jurisdiction to pass such an order thereunder subject to the conditions laid down therein.
The condition for the exercise of that power is that it should have obtained the consent of the party whose goods were confiscated.
The High Court in its order observed that there was nothing before it to show that the consent of the owner of the goods ordered to be confiscated was not obtained before the order of confiscation was commuted to one of penalty by the Chief Customs Authority.
If that be taken as a finding the question of the legal effect of an order of commutation would arise for consideration.
Would such an order be deemed to be made in substitution of that of an original authority? Could it be said that the commuted sentence shall be deemed in law a sentence imposed by the original tribunal? But these questions need not detain us, as we are not satisfied on the material placed before us that the condition of consent has been fulfilled in this case.
The High Court in effect drew a presumption in favour of the regular performance of an official act.
But this presumption is only optional.
In a case like this when the validity of an order depends upon the fulfilment of a condition, the party relying upon 'the presumption should at least show that the order on the face of it is regular and is in conformity with the provisions of the statute.
But in the present case the order of the Chief Customs Authority ex facie does not show that it was made under section 190 of the Act.
Indeed it is purported to have been made under section 167(8) of the Act.
If as a matter of fact the said Authority made the order of commutation with the consent of the owner of the goods it would have certainly jurisdiction to make such an order under section 190 of the Act.
Though there was no such recital, it would have been open to the appellant to establish that fact by necessary evidence.
In the absence of any such 'evidence we must hold that it has 905 not been established that the Chief Customs Authority made its order under section 190 of the Act with the consent of the respondent.
This will not preclude the State from establishing by relevant evidence that the penalty was imposed under section 190 of the Act with the consent of the owner of the goods in an appropriate proceeding.
In the result the order of the High Court is correct and the appeal is dismissed.
Appeal dismissed.

dataset_name: IN-Abs

summary:
The respondent imported goods of higher value than what was granted under his licence.
The Collector of Customs ordered the goods to be confiscated under section 167(8) of the and in lieu of confiscation gave an option to the respondent to a fine.
On appeal the Central Board of Revenue set aside the order of the Collector of Customs and instead of it imposed a penalty.
The respondent did not pay the penalty and the Collector of Customs took proceedings under section 193 of the Act for the recovery of the penalty in pursuance of which a Magistrate issued warrants of attachment against the respondent holding that the Collector of Customs could validly realise the penalty under section 193 of the Act.
The Sessions Judge dismissed the respondents application in revision but the High Court held that as the penalty was imposed by the Central Board of Revenue the Collector of Customs could not realise the amount of the penalty under section 193 of the Act and also held that the order of the Central Board of Revenue commuting the confiscation to penalty was not without jurisdiction.
On appeal by special leave, Held, that the Central Board of Revenue which is the "Chief Customs Authority" cannot be called an "officer of Customs", and the order of the Chief Customs Authority imposing a penalty for the first time cannot be treated to be an order of the Collector of Customs within the meaning of section 193 of the Sea Customs Act, 1873, and as such the Collector of Customs could not realise the penalty imposed by the Central Board of Revenue.
Rangaswamy vs Alagayammal, A.I.R. (1915) Mad.
1133, Kristnamachariar vs Mangammal, Mad. 91 and Lachmeshwar Prasad Shukul vs Keshwar Lal Chaudhuri, , held not applicable.


judgement:
109 of 1961.
Writ Petition under article 32 of the Constitution of India for enforcement of the Fundamental Rights.
M. O. Setalvad, Attorney General of India, B. R. L. Iyengar and K. P. Bhat, for the petitioner.
A. V. Viswanatha Sastri, R. Gopalakrishnan and T. M. Sen, for the respondents.
April 12.
The Judgment of the Court was delivered by DAS GUPTA, J.
The petitioner, who is the proprietor of the Shaheen Motor Service, used to ply a motor bus for hire on the route Archalli to Saravanabelgola in Hassan District in the State of Mysore.
A scheme under section 68 C of the of 1939 having been published by the Mysore Transport Undertaking, the petitioner as one of the persons affected thereby filed objections to the scheme before the State Government under section 68 D(1) of the Act.
The State Government however after considering the objections a, id hearing the petitioner approved the scheme, subject to a slight modification with which we arc not concerned.
This approval was given on December 22, 1959.
In pursuance of this approved scheme the State Transport Undertaking the 2nd respondent before us made applications for permits but before the Regional Transport Authority could issue such permits the present petition was filed praying, in the first place, for a writ of certiorari to quash the scheme and some consequential directions, and secondly for a wait of 911 "prohibition" to the Regional Transport Authority, Hassan District, who is the third respondent before us "to refrain from dealing with the applications for permit made by the 2nd respondent unless and until they are duly published and notice thereof is given to the petitioner and he is allowed to make his representation thereon regarding their compliance or otherwise with the conditions of section 68 F(1) of Chapter IV A.
After learned counsel for the petitioner had been heard, this Court by its order dated March 21, 1961, granted leave to the petitioner to amend the writ petition so as to confine it to the second prayer only and directed a rule to issue only in respect of this second prayer.
The only question with which we are therefore now concerned is whether a writ should issue prohibiting, the Regional Transport Authority, Hassan District, from dealing with the applications for permits made by the State Transport Undertaking "unless and until they are duly published and notice thereof is given to the petitioner and he is allowed to make his representations thereon".
The petitioners case as regards this prayer is that under the law no permit can be granted to the State Transport Undertaking until the applications for permit have been duly published and notice has been given to the petitioner of those applications.
In support of this proposition learned counsel advanced two arguments firstly, that section 57(3) in Chapter IV of the Act, requires such prior publication with notice of the date before which representations in connection with the application may be submitted and that in consequence of section 68 B of Chapter IV A the above provisions of section 57(3) of Chapter IV have to be followed.
The second argument is that the Regional Transport Authority acts in a quasi judicial capacity when dealing with applications for permits made under section 68 F and so the petitioner who will be affected by the issue of the permits is entitled to notice.
Section 68 B on which reliance has been placed provides inter alia that the provisions of Chapter IV A 912 shall have effect "notwithstanding anything inconsistent therewith contained in Chapter IV".
It says nothing positive as regards any of the provisions of Chapter IV being applicable to matters under Chapter IV A but provides negatively that if any question arises as regards any provisions of the Act in Chapter IV A and there is difficulty in applying it on the ground that there is conflict between it and some provisions of Chapter IV, the provisions of Chapter IV A will prevail.
Mr. Iyengar has argued that it is implicit in this provision that if there is no such difficulty all the provisions of Chapter IV will apply to matters dealt with under Chapter IV A.
This argument, in our opinion, is fallacious.
All that section 68 B pre supposes is that there are some provisions in Chapter IV which may apply to matters under Chapter IV A; on that assumption it proceeds to say that if on a matter to which provisions of Chapter IV would prima facie apply there is a provision in Chapter IV A also which appears applicable the provision in Chapter IV A will prevail to the extent of its inconsistency with the corresponding provision in Chapter IV.
As to what provisions in Chapter IV will apply or not section 68 B says nothing and provides no guidance either expres sly or by implication.
To find out whether a particular provision in Chapter IV (not being inconsistent with any provisions in Chap.
IV A) will apply or not to a matter under Chapter IV A, we have to examine the matter in question and then decide whether it is of such a nature that it attracts that particular provision of Chapter IV.
What then is the matter dealt with under section 68 F(1) with which we are concerned in the present case? Section 68 F(1) comes into operation when a scheme has already been approved by the State Government under section 68 D(2).
In order that the approved scheme may be implemented the State Transport Undertaking which is to run and operate.
the Transport Service under the scheme must have a permit from the Regio nal Transport Authority.
Section 68 F(1) provides that the State Transport Undertaking will have to apply for a permit (i) in pursuance of the approved 913 scheme and (ii) in the manner specified in Chapter IV.
Once that is done, the sub section proceeds to say " 'A Regional Transport Authority shall issue such permit to the State Transport Undertaking", and this "notwithstanding anything to the contrary contained in Chapter IV.
" It appears clear to us that the provisions of section 57(3) have nothing to do with these matters dealt with by section 68 F(1).
Section 57(3) lays on the Regional Transport Authority certain duties when it considers an application for a permit.
These conditions are (1) to make the application available for inspection at the office of the Authority, (2) to publish the application or the substance thereof in the prescribed manner together with a notice of the date before which representations in connection therewith may be submitted and the date and the time and place at which the application and any representa tions, received will be considered.
Under section 68 F(1) as already mentioned the Regional Transport Authority has no option to refuse the grant of the permit provided it has been made in pursuance of the approved scheme and in the manner mentioned in Chap.
The duty of the Regional Transport Authority on receipt of the application from the State Transport Undertaking for a permit is therefore to examine the application for itself to see whether it is in pursuance of an approved scheme and secondly whether it has been made in the manner laid down in Chapter IV.
This is a duty which the Regional Transport Authority has to perform for itself and there is no question of its asking for assistance from the public or existing permit holders for Transport Services on the route.
Neither the public in general nor the permit holder has any part to play in this matter.
The provisions of section 57(3) for making the application made under Chapter IV, available for inspection, for publishing the application or a substance thereof with a notice of the date by which the representations may be submitted and the date, time and place when the representations will be considered are required to enable the Regional Transport Authority to come to a 115 914 correct conclusion as to whether the application should be granted or not.
An application not made in the manner laid down in Chapter IV will not be con sidered by the Regional Transport Authority at all.
But the mere fact that it has been made in the proper manner will not entitle the applicant to a permit.
it is the duty of the Regional Transport Authority to decide on a consideration of all relevant matters whether the application should be allowed.
Other operators and even the public have a legal right to make representations to persuade the Authority not to grant the permit on the merits of the case.
It is for this reason that there was necessity to make the provisions in sub section 3 of section 57 so that the Regional Transport Authority may receive every assistance in coming to a proper conclusion.
When however a scheme prepared and published under section 68 C has been approved and an application has been made in pursuance of the scheme and in the proper manner as specified in Chapter IV nothing more remains to be decided by the Regional Transport Authority.
The nature of the matter dealt with under section 68 F(1) is thus such as does not and cannot attract any of the provisions of section 57(3).
It may be mentioned here that in Srinivasa Reddy.
& Or.3.
vs The State of Mysore & Ors.
(1) a question was raised whether section 57(3) applied or not to an application made under section 68 F(1).
The Court considered it unnecessary then to go into the matter as on the facts of that case it was found that the application had not been made in the manner provided in Chapter IV and was actually in breach of section 57(2) of the Act and so no permit could be issued on such an application.
The provision in section 57(2) which was applicable to applica tions under section 68 F is that an application for a permit shall be made not less than six weeks before the date on which it is desired that the permit shall take effect or if the Regional Transport Authority appoints dates for the receipt of such application on such dates.
In that case the Court held that this provision in section 57(2) is in reality a manner of making the (1) ; 915 application and consequently it applied to applications made under section 68 F(1).
The provisions of section 57(3) cannot however be said to have anything to do with the manner of making the application and the nature of the matter dealt with under section 68 F(1) is such that provisions of section 57(3) are not attracted, The next argument is that the Regional Transport Authority functions as a quasi judicial authority when dealing with an application made by the State Transport Undertaking under section 68 F(1).
It is said that as under section 68 F(2) the Regional Transport Authority may refuse to entertain an application for renewal of any other permit or cancel an existing permit or modify in certain matters the terms of an existing permit, for the purpose of giving effect to the approved scheme there is a lis between the existing permit holders and the State Transport Undertaking when an application under section 68 F(1) is dealt with.
It appears to us that when deciding what action to take under section 68 F(2) the authority is tied down by the terms and conditions of the approved scheme and his duty is merely to do what is necessary to give effect to the provisions of the scheme.
, The refusal to entertain applications for renewal of permits or cancellation of permits or modification of terms of existing permits really flow from the scheme.
The duty is therefore merely mechanical; and it will be incorrect to say that there is in these matters any lis between the existing operators and the State Transport Undertaking which is to be decided by the Regional Transport Authority.
There is no justification therefore for saving that when taking action under section 68 F(2) the regional Transport Authority is exercising a quasi judicial function.
Apart from this it has to be pointed out that action under section 68 F(2) is really independent of the issue of the permits under section 68 F(1).
Once the scheme has been approved, action under section 68 F(1) flows from it and at the same time action under section 68 F(2) flows from the same scheme.
The argument that the Regional Transport Authority should be held to be exercising quasi judicial function in dealing with applications for permits under section 68 F(1) 916 because of the action it may take under section 68 F(2) therefore fails.
It was next said that when the Regional Transport Authority issues the permit it can attach to the permit conditions under section 48(3) of the Act.
Section 48(3) authorises the Regional, Transport Authority if it decides to grant a stage carriage permit, to attach to the permit any of the conditions specified in the subsection.
It has to be noticed that section 68 F(1) does not speak of the "grant" of a permit but provides that the Regional Transport Authority shall "issue" a permit.
In any case, if the Regional Transport Authority has to decide what conditions to attach to such a permit, it is not possible to say that it is then exercising a quasi judicial function.
For, in deciding that matter the Regional Transport Authority is to have regard to the interests of the public but there is no question because of that, of any lis between the State Transport Undertaking on the one hand and the public on the other.
In our opinion, the Regional Transport Authority acts wholly in a ministerial capacity while dealing with an application of the State Transport Undertaking under section 68 F(1).
The fact that on other occasions and in other matters the Regional Transport Authority has quasi judicial functions to perform cannot make its function under, section 68 F(1) a quasi judicial function.
Our conclusion therefore is that the petitioner 's contention that no permit can be granted to the State Transport Undertaking until the applications for permit have been duly published and notices have been given to the petitioner of these applications is unsound Consequently, the petitioner is not entitled to any relief.
The petition is dismissed with costs.
Petition dismissed.

summary:
After a scheme 'Was published by the Mysore Transport Undertaking under section 68 C of the , and approved by the State Government the State Transport Undertaking made applications for permits under section 68 F(1) of the Act to the Regional Transport Authority but before the permits were granted the second respondent made an application for a Writ of Certiorari prohibiting the Regional Transport Authority from dealing with the second respondent 's application for permit unless and until they were duly published and notice was given to him for making representations.
The contention on his behalf was that the publication of the applications with notice of the (late for submitting the representations was necessary under section 57(3) Ch.
IV of the Act and that lie was entitled to notice as the Regional Transport Authority acted in a quasijudicial capacity while dealing with applications for permits.
Held, that when a scheme.
prepared and published under section 68 C has been approved and in application has been made in pursuance of the scheme and in the proper manner as specified in Ch.
IV nothing more remains to be decided by the Regional 910 Transport Authority and it has no option to refuse the grant of the permit.
The nature of the matter dealt under.s.
68 F(1) is such as does not attract the provisions of section 57(3) which lays down certain duties on the Regional Transport Authority when it considers an application for a permit.
The provisions of section 57(3) have nothing to do with the matters dealt with by section 68 F(1).
Srinivasa Reddy vs State of Mysore, ; , referred to.
When taking action under, section 68 F(1) the Regional Transport Authority does not exercise any quasi judicial function and acts wholly in a ministerial capacity.


judgement:
305/1960.
Petition under Article 32 of the Constitution of India for enforcement of Fundamental Rights.
Petitioner in person.
H. N. Sanyal, Additional Solicitor General of India pond R. H. Dhebar, for the respondents, 441 1961.
January 12.
The Judgment of the Court was delivered by SUBBA RAO, J.
This is a; petition under article 32 of the Constitution for an order in the nature of habeas corpus claiming that the petitioner has justly served his sentence and should, therefore, be released.
On February 10, 1949, the Judge, Special Court, Red Fort, Delhi, convicted the petitioner for offences under section 3, read with section 6, of the Explosive Substances Act, under section 4(b) and section 5 thereof, I and for murder under section 302, read with section 109, of the Indian Penal Code; for the first two offences he was sentenced to seven years ' rigorous imprisonment and five years rigorous imprisonment respectively and for the third offence to transportation for life and all the sentences were directed to run concurrently.
After conviction he was imprisoned in jails in the State of Punjab till May 19, 1950, and thereafter he was transferred to Nasik Road Central Prison in the State of Bombay (now Maharashtra).
According to the petitioner, he has earned the following remissions up to September 30, 1960: (a) Ordinary remission . 836 days (b) Special remission . 206 days (c) Physical training remission . 113 days (d) Literary remission . 108 days (e) Annual good conduct remission . 250 days (f) State remission . 1380 days The total of the remissions earned is 2,893 days; but the State in its counter affidavit state that the petitioner has earned up to the said date remission of 2,963 days.
The figure given by the State may be accepted as correct for the purpose of this petition.
If the amount of remissions thus earned was added to the term of imprisonment the petitioner has actually served, the aggregate would exceed 20 years, and even if only the State remission was added to it, it would exceed 15 years.
The petitioner, claiming that under the relevant provisions governing his imprisonment his further detention in jail would be illegal, prays that he might be set at liberty forthwith.
The State, while conceding that he has earned remissions 56 442 &mounting to 2,963 days, alleged in the counter affidavit that the remissions earned did not entitle him to be released and that under the rules the question of his release would be considered only after he completed 15 years ' actual imprisonment.
The petitioner argued his case in person.
He rejected the help of an advocate as amicus curiae to assist him.
In the circumstances, his argument was based more on emotional plane than on legal basis.
But as the liberty of a citizen is involved, we have gone through the relevant provisions and considered the possible contentions that may be raised on the basis of the said provisions.
The first question that falls to be decided is whether, under the relevant statutory provisions, an accused who was sentenced to transportation for life, could legally be imprisoned in one of the jails in India; and if so, what was the term for which he could be so imprisoned.
We shall briefly notice the relevant provisions of the Indian Penal Code before it was amended by the Code of Criminal Procedure (Amendment) Act XXVI of 1955.
Section 53 of the Indian Penal Code set out six different punishments to which offenders were liable.
The second of those punishments was transportation and the fourth was imprisonment which was of two descriptions, namely, rigorous and simple.
The word " transportation " was not defined in the Indian Penal Code, but it was for life with two exceptions.
Under section 55 of the Indian Penal Code, " In every case in which sentence of transportation for life shall have been passed, the Provincial Government of the Province within which the offender shall have been sentenced may, without the consent of the offender, commute the punishment for imprisonment of either description for a term not exceeding fourteen years.
" Under section 58 thereof, in every case in which a sentence of transportation was passed, the offender, until he was transported, should be dealt with in the same manner as if sentenced to rigorous imprisonment and should be held to have been undergoing his sentence of transportation during the term of his imprisonment.
It was averred on behalf of the 443 State that the petitioner 's sentence had not been commuted under section 55 of the Indian Penal Code or under section 402 (1) of the Code of Criminal Procedure to one of rigorous imprisonment.
We have no reason for not accepting this statement.
On that basis, a question arises whether the petitioner, who was sentenced to transportation, could be dealt with legally as if he were a person sentenced to rigorous imprisonment.
This question was raised before the Judicial Committee of the Privy Council in Pandit Kishori Lal vs King Emperor(1).
After considering the history of the sentence of transportation, the relevant provisions of the Indian Penal Code, the Code of Criminal Procedure and the Prisons Act, the Privy Council came to the conclusion that the said provisions made it plain that when a sentence of transportation had been passed it was no longer necessarily a sentence of transportation beyond the seas.
It was observed at p. 9 thus: " But at the present day transportation is in truth but a name given in India to a sentence for life and, in a few special cases, for a lesser period, just as in England the term imprisonment is applied to all sentences which do not exceed two years and penal servitude to those of three years and upwards. . . .
So, in India, a prisoner sentenced to transportation may be sent to the Andamans or may be kept in one of the jails in India appointed for transportation prisoners, where he will be dealt with in the same manner as a prisoner sentenced to rigorous imprisonment.
" In view of this weighty authority with which we agree, it is not necessary to consider the relevant provisions, particularly in view of section 53A of the Indian Penal Code which has been added by Act XXVI of 1955.
Section 53A of the said Code reads: "(1). . (2) In every case in which a sentence of transportation for a term has been passed before the commencement of the Code of Criminal Procedure (Amendment) Act, 1954, the offender shall be dealt with in the same manner as if sentenced to rigorous imprisonment for the same term.
(1) (1944) L.R. 72 I.A. I, 444 Whatever justification there might have been for the contention that a person sentenced to transportation could not be legally made to undergo rigorous imprisonment in a jail in India except temporarily till he was so transported, subsequent to the said amendment there is none.
Under that section, a person transported for life or any other term before the enactment of the said section would be treated as a person sentenced to rigorous imprisonment for life or for the said term.
If so, the next question is whether there is any provision of law whereunder a sentence for life imprisonment, without any formal remission by appropriate Government, can be automatically treated as one for a definite period.
No such provision is found in the Indian Penal Code, Code of Criminal Procedure or the Prisons Act.
Though the Government of India stated before the Judicial Committee in the case cited supra that, having regard to section 57 of the Indian Penal Code, 20 years ' imprisonment was equivalent to a sentence of transportation for life, the Judicial Committee did not express its final opinion on that question.
The Judicial Committee observed in that case thus at p. 10: " Assuming that the sentence is to be regarded as one of twenty years, and subject to remission for good conduct, he had not earned remission sufficient to entitle him to discharge at the time of his application, and it was therefore rightly dismissed, but in saying this, their Lordships are not to be taken as meaning that a life sentence must and in all cases be treated as one of not more than twenty years, or that the convict is necessarily entitled to remission.
" Section 57 of the Indian Penal Code has no real bearing on the question raised before us.
For calculating fractions of terms of punishment the section provides that transportation for life shall be regarded as equivalent to imprisonment for twenty years.
It does not say that transportation for life shall be deemed to be transportation for twenty years for all purposes; nor does the amended section which substitutes the words imprisonment for life " for " transportation for life enable the drawing of any such all embracing fiction.
A sentence of transportation for life or 445 imprisonment for life must prima facie be treated as transportation or imprisonment for the whole of the remaining period of the convicted person 's natural life.
It is said that the Bombay rules governing the remission system substituted a definite period for life imprisonment and, therefore, if the aggregate of the term actually served exceeds the said period, the person would be entitled to be released.
To appreciate this contention the relevant Bombay rules may be read.
Release.
Rule 934. " In a11 cases of premature releases, orders under Section 401, Criminal Procedure Code, will have to be issued by Government before the prisoners can actually be released from Jail.
" Rule 937.
(c) " When a life convict or a prisoner in whose case the State Government has passed an order forbidding his release without reference to it, has earned such remission as would entitle him to release but for the provisions of this rule, the Superintendent shall report accordingly to the State Government through the Inspector General in order that his case may be considered with reference to Section 401 of the Code of Criminal Procedure, 1898.
" The Remission System: Rule 1419.
(c) " A sentence of transportation for life shall ordinarily be taken as 15 Years ' actual imprisonment." Review of Sentences: Rule 1447.
(2) " Notwith standing anything contained in rule 1419 no prisoner who has been sentenced to transportation for life or more than 14 years, imprisonment or to transportation and imprisonment or to transportation and imprisonment for terms exceeding in the aggregate 14 years shall be released on completion of his term of transportation or imprisonment or both, as the case may be, including all remissions unless a report with respect to such prisoner has been made under sub.rule (1) and orders of Government have been received thereon with regard to the date of his final release.
" It is common case that the said rules were made under the , and that they have 446 statutory force.
But the does not confer on any authority a power to commute or remit sentences; it provides only for the regulation of prisons and for the treatment of prisoners confined therein.
Section 59 of the confers a power on the State Government to make rules, inter alia, for rewards for good conduct.
Therefore, the rules made under the Act should be construed within the scope of the ambit of the Act.
The rules, inter alia, provide for three types of remissions by way of rewards for good conduct, namely, (i) ordinary, (ii) special and (iii) State.
For the working out of the said remissions under rule 1419(c), transportation for life is ordinarily to be taken as 15 years ' actual imprisonment.
The rule cannot be construed as a statutory equation of 15 years ' actual imprisonment for transportation for life.
The equation is only for a particular purpose, namely, for the purpose of " remission system " and not for all purposes.
The word " ordinarily " in the rule also supports the said construction.
The non obstante clause in sub rule (2) of rule 1447 reiterates that notwithstanding anything contained in rule 1419 no prisoner who has been sentenced to transportation for life shall be released on completion of his term unless orders of Government have been received on a report submitted to it.
This also indicates that the period of 15 years ' actual imprisonment specified in the rule is only for the purpose of calculating the remission and that the completion of the term on that basis does not ipso facto confer any right upon the prisoner to release.
The order of Government contemplated in rule 1447 in the case of a prisoner sentenced to transportation for life can only be an order under section 401 of the Code of Criminal Procedure, for in the case of a sentence of transportation for life the release of the prisoner can legally be effected only by remitting the entire balance of the sentence.
Rules 934 and 937(c) provide for that contingency.
Under the said rules the orders of an appropriate Government under section 401, Criminal Procedure Code, are a prerequisite for a release.
No other rule has been brought to our notice which confers an indefeasible right on a 447 prisoner sentenced to transportation for life to an unconditional release on the expiry of a particular term including remissions.
The rules under the do not substitute a lesser sentence for a sentence of transportation for life.
Briefly stated the legal position is this: Before Act XXVI of 1955 a sentence of transportation for life could be undergone by a prisoner by way of rigorous imprisonment for life in a designated prison in India.
After the said Act, such a convict shall be dealt with in the same manner as one sentenced to rigorous imprisonment for the same term.
Unless the said sentence is commuted or remitted by appropriate authority under the relevant provisions of the Indian Penal Code or the Code of Criminal Procedure, a prisoner sentenced to life imprisonment is bound in law to serve the life, term in prison.
The rules framed under the enable such a prisoner to earn remissions ordinary, special and State and the said remissions will be given credit towards his term of imprisonment.
For the purpose of working out the remissions the sentence of transportation for life is ordinarily equated with a definite period, but it is only for that particular purpose and not for any other purpose.
As the sentence of transportation for life or its prison equivalent, the life imprisonment, is one of indefinite duration, the remissions so earned do not in practice help such a convict as it is not possible to predicate the time of his death.
That is why the rules provide for a procedure to enable the appro priate Government to remit the sentence under section 401 of the Code of Criminal Procedure on a consideration of the relevant factors, including the period of remissions earned.
The question of remission is exclusively within the province of the appropriate Government; and in this case it is admitted that, though the appropriate Government made certain remissions under section 401 of the Code of Criminal Procedure, it did not remit the entire sentence.
We, therefore, hold that the petitioner has not yet acquired any right to release.
448 The petitioner made an impassioned appeal to us that if such a construction be accepted, he would be at the mercy of the appropriate Government and that the said Government, out of spite, might not remit the balance of his sentence, with the result that he would be deprived of the fruits of remissions earned by him for sustained good conduct, useful service and even donation of blood.
The Constitution as well as the Code of Criminal Procedure confer the power to remit a sentence on the executive Government and it is in its exclusive province.
We cannot assume that the appropriate Government will not exercise its jurisdiction in a reasonable manner.
For the foregoing reasons we hold that the petitioner is under legal detention and the petition for habeas corpus is not maintainable.
The petition is dismissed.
Petition dismissed.

summary:
The petitioner was convicted in 1949 and sentenced to trans portation for life.
He earned remission of 2963 days and adding this to the term of imprisonment actually served by the petitioner the aggregate exceeded 20 years.
The petitioner contended that his further detention in jail was illegal and prayed for being set at liberty: Held, that the petitioner had not yet acquired any right to be released.
A sentence of transportation for life could be undergone by a prisoner by way of rigorous imprisonment for life in a designated prison in India.
Section 53A of the Indian Penal Code, introduced by the Code of Criminal Procedure (Amendment) Act, 1955, provided that any person sentenced to transportation for life before the Amendment Act would be treated as sentenced to rigorous imprisonment for life.
A prisoner sentenced to life imprisonment was bound to serve the remainder of his life in prison unless the sentence was commuted or remitted by the appropriate authority.
Such a sentence could not be equated with any fixed term.
The rules framed under the Prisons Act entitled such a prisoner to earn remissions but such remissions were to be taken into account only towards the end of the term.
The question of remissions was exclusively within the province of the appropriate Government.
In the present case though the Government had made certain remissions under section 401 of the Code of Criminal Procedure, it had not remitted the entire sentence.
Pandit Kishori Lal vs King Emperor, (1944) L.R. 72 I.A. , referred to.