judgement:
Civil Appeal No. 2984 of 1987.
From the Judgment and Order dated 30.3.1987 of the Delhi High Court in L.P.A. No.67 of 1987.
M.K. Ramamurthi, Mrs. C. Ramamurthi and M.A. Krishnamoorthy for the Appellant.
Dr. Y.S. Chitale, Ms. M. Roy, H.K. Puri and H.K. Dutt for the Respondents.
The Judgment of the Court was delivered by VENKATARAMIAH,J.
The appellant joined the service of the Narang Bank of India Ltd., New Delhi on July 12, 1974 as a Clerk cum Typist and was confirmed in his service on October 1, 1974.
The Narang Bank of India Ltd., however, terminated his services on February 10, 1975 without assigning any reason.
On an industrial dispute being raised the Central Government by its order dated July 9, 1975 referred the following dispute to the Central Government Industrial Tribunal for adjudication: "Whether the action of the management of the Narang Bank of India, New Delhi in terminating the 1092 services of Shri Bhagwan Dass Chopra w.e.f. 10.2.1975 is justified? If not, what relief is the said workman entitled? The claim made by the appellant was disputed by the management.
On the basis of the pleadings filed by the parties the Industrial Tribunal framed issues and directed the parties to lead evidence.
In the course of the trial the appellant examined himself and he was cross examined by the representative of the Narang Bank of India Ltd. Thereafter the evidence of the appellant was closed on 21.5.1976.
On July 25, 1976 the Narang Bank of India Ltd. entered into an agreement with the United Bank of India, respondent No. 1 herein, whereunder all the assets and liabilities of the Narang Bank of India Ltd. were taken over by the United Bank of India, respondent No. 1.
The employees of the erstwhile Narang Bank of India Ltd. became the employees of the United Bank of India, respondent No. 1 by virtue of clause 20 of the said agreement.
The relevant part of clause 20 read thus: "20.
(a) The Transferee shall be under an obligation to take over and absorb and retain with effect from 1st August, 1976 in its employment such staff, employees and assistants (hereinafter called "the said employees") of the Transferor or employed by the Transferor in relation to or in connection with the said banking business intended to be taken over or acquired by the Transferee as aforesaid who were permanent employees of the Transferor on the said date and on the same terms and conditions including the remuneration and wages and/or other lawful claims as were or are applicable or payable to them on the said date subject to the terms and conditions as contained in the Third Schedule hereto PROVIDED ALWAYS that such taking over or absorption of the staff and employees of the Transferor by the Transferee on the same terms and conditions as hereinbefore mentioned and/or also referred to or otherwise mentioned in the Third Schedule hereto shall not however be so construed as to include or extend to their or each of their rank and status.
(b) The Transferee shall not, however, be bound to take over or absorb in their employment (i) all such staff, assistants and employees against whom any show cause notice or any action (penal or otherwise) or any enquiry or any actions and/or proceedings whatsoever are pending on 1093 the said date by the Management or by any Tribunal Court or otherwise and/or who are on the said date involved or figuring in any such enquiries, actions and/or proceedings and against whom any adverse or suspension order finding or decision has been passed or is likely to be passed prior or subsequent to the said date.
(ii) Any such staff employees and assistants of the Transferor whose services have been terminated by the Transferor on or before the said date and/or against whom any adverse or suspension order finding or decision has been passed by any person holding any enquiry and/or Management of the Transferor and or by any court, Tribunal or otherwise subsequent to the said date but prior to the formal taking over of the said business or assets or properties of the Transferor by the Transferee on the basis of this Agreement.
PROVIDED NEVERTHELESS the Transferee shall take over suspended employee, if any, of the Transferor relating to the said business with effect from the said date and/or condition as herein before mentioned in clause 20(a) above in so far as the same shall be applicable if and only if such employee/employees is or are finally and ultimately absolved/exonerated or acquitted from or of all the charges levelled against him/them.
On August 1, 1976 the Narang Bank of India Ltd. was totally merged with the United Bank of India.
On August 2, 1976 three witnesses gave evidence on behalf of the former Narang Bank of India Ltd., two of whom were employees of the United Bank of India Ltd. by virtue of the agreement of merger referred to above.
On September 20, 1976 two more witnesses were examined of whom one witness was a former officer of the Narang Bank of India Ltd. On that date the appellant made an application for permission to implead the United Bank of India also as a party in view of the merger which had taken place.
The United Bank of India took time till November 5, 1976 to file its reply to the application made by the appellant.
The evidence of the Narang Bank of India Ltd. was, however, closed on November 5, 1976.
The United Bank of India sought further time to file a reply to the appellant 's application.
That reply was filed on November 10, 1976.
After hearing arguments on the application the Tribunal directed that the United Bank of India should be impleaded as a party and also gave time to the appellant to file an amended statement of claim.
The term of the Presiding Officer having expired on December, 1094 1, 1976, a new Presiding Officer was appointed in July, 1977.
On December 1, 1977 the United Bank of India filed its written statement.
On January 25, 1978 the United Bank of India offered to reinstate the appellant but without backwages and the case was adjourned for some time.
But no compromise was reached.
On August 23, 1978 the United Bank of India examined its Personnel Officer Shri R.B. Ray and formally closed the evidence.
The case was thereafter adjourned to October 3, 1978 for arguments.
On that date the United Bank of India submitted an application praying that the Bank should be allowed to cross examine the appellant whose evidence had been closed on May 21, 1976.
By its order dated October 17, 1978 the Tribunal dismissed the application of the United Bank of India on the ground that since no new plea had been taken there was no ground to recall the appellant and subject him for further cross examination.
The arguments were heard by the Tribunal on November 2, 1978 and an award was given on January 30, 1981 holding that the termination of the services of the appellant was not justified and was bad, illegal, and unenforceable.
The Tribunal also held that the appellant should be deemed to be in continuous service of the Narang Bank of India Ltd., New Delhi on and after the 10th February, 1975 and consequently of the United Bank of India on the date of the award.
The Tribunal directed that the appellant should be paid his full back wages upto the date of his reinstatement.
It also awarded costs of Rs. 1,000 to the appellant.
Aggrieved by the said award the United Bank of India filed a writ petition before the High Court of Delhi in Civil Writ Petition No. 928 of 1981.
That petition was heard and disposed of by the learned Single Judge of the High Court on February 24, 1987.
The learned Single Judge set aside the award made by the Tribunal on the ground that when once a person was impleaded as a party to the proceedings, principles of natural justice required that he should be given an opportunity to cross examine those witnesses whose evidence had been recorded earlier and since the Tribunal had declined to grant permission to the United Bank of India to cross examine the appellant whose evidence had been closed on May 21, 1976 the award was liable to be quashed.
The learned Single Judge, however, remanded the case to the Industrial Tribunal to decide the case again after giving an opportunity to the United Bank of India to cross examine the appellant and other witnesses.
Aggrieved by the judgment of the learned Single Judge the appellant filed Letters Patent Appeal No. 67 of 1987 before the Division Bench of the High Court.
That appeal was dismissed by the Division Bench of the High Court holding that the United Bank of India had the right to cross examine the appellant on the sole ground that it had been impleaded as a party after the merger of the 1095 Narang Bank of India Ltd. with the United Bank of India.
Aggrieved by the decision of the Division Bench of the High Court the appellant has filed this appeal by special leave.
The question for consideration in this case is whether a party who acquires the rights and liabilities of a party to a proceeding is entitled to reopen as a matter of course the proceedings on being impleaded as a party in the place of the party whose rights and liabilities he had taken over.
No express provision corresponding to rule 10 order 22 of the Code of Civil Procedure, 1908, which provides that in cases of an assignment, creation or devolution of any interest during the pendency of a suit other than those cases dealt with earlier in order 22 of the Code of Civil Procedure, 1908, the suit may by leave of the court, be continued by or against the person to or upon whom such interest has come or devolved is applicable to the proceedings before the Industrial Tribunal has been brought to our notice.
Section 18 of the , however, provides that an award of a Labour Court, Tribunal or National Tribunal which has become enforceable shall be binding on all parties to the industrial dispute; all other parties summoned to appear in the proceedings as parties to the dispute, unless the Labour Court, Tribunal or National Tribunal as the case may be records the opinion that they were so summoned without proper cause; and where a party referred to above is an employer, his heirs, successors or assigns in respect of the establishment to which the dispute relates.
It is, however, necessary to evolve a reasonable procedure to deal with cases where a devolution of interest takes place during the pendency of a proceeding arising under the .
In the circumstances it is reasonable to hold that in every case of transfer, devolution, merger, takeover or a scheme of amalgamation under which the rights and liabilities of one company or corporation stand transferred to or devolve upon another company or corporation either under a private treaty, or a judicial order or under a law the transferee company or corporation as a successor in interest becomes subject to all the liabilities of the transferor company or corporation and becomes entitled to all the rights of the transferor company or corporation subject to the terms and conditions of the contract of transfer or merger, the scheme of amalgamation and the legal provisions as the case may be under which such transfer, devolution, merger, takeover or amalgamation as the case may be may have taken place.
It follows that subject to such terms it becomes liable to be impleaded or becomes entitled to be impleaded in the place of or in 1096 addition to the transferor company or corporation in any action, suit or proceeding filed against the transferor company or corporation by a third party or filed by the transferor company or corporation against a third party and that whatever steps have already taken place in those proceedings will continue to operate against and be binding on the transferee company or corporation in the same way in which they operate against a person on whom any interest has devolved in any of the ways mentioned in rule 10 of order 22 of the Code of Civil Procedure, 1908 subject of course to any terms in the contract of transfer or merger, scheme of amalgamation or other relevant legal provisions governing the transaction under which the transferee company or corporation has become the successor in interest of the transferor company or corporation.
In the instant case admittedly all the rights and liabilities of the Narang Bank of India Ltd. in its banking business were taken over by the United Bank of India under the agreement of merger dated July 25, 1976.
Clause 22 of the agreement of merger provides as follows: "22.
The Transferee shall be substituted in place of the Transferor in respect of all Court or Tribunal proceedings cases, suits and Government and Municipal and records and shall apply to the authorities, court, Tribunal or otherwise for being added as the parties hereto and the benefits of all orders, directions, decrees and award or judgment if and when issued will pass on to the Transferee, who shall be bound or abide by the same subject to the liabilities not taken over by the Transferee including those in respect of staff assistants and employees concerned of the Transferor as mentioned in clause 20 hereof.
All legal costs for such substitution and/or prosectuion or contesting the said action and proceedings existing or binding on the said date shall be borne by the Transferee." In view of the terms of the agreement of merger and in particular clause 22 thereof the United Bank of India was rightly impleaded as a party to the proceedings before the Tribunal in the place of the Narang Bank of India Ltd. By reason of impleading of the United Bank of India as a party there was no change in the character of the proceedings pending before the Tribunal.
The United Bank of India only stepped into the shoes of the Narang Bank of India Ltd. and all proceedings that had gone on till the date on which the United Bank of India was so impleaded were binding on the United Bank of India.
1097 The proceedings before the Tribunal could thereafter be continued against the United Bank of India.
The United Bank of India could thereafter take part in the further proceedings before the Tribunal in the same capacity in which the Narang Bank of India Ltd. was appearing in the case.
It was bound by all proceedings which had taken place till then.
It could not go back on the proceedings.
Generally speaking an assignee cannot set up a case inconsistent with the one put forward by his assignor and it is only in exceptional cases an assignee could be permitted to raise any new plea and that too only for avoiding multiplicity of the proceedings.
In the instant case there was no such exceptional circumstance which entitled the United Bank of India to take up a plea different from the pleas which had already been taken up by the Narang Bank of India Ltd and there was also no need to permit it to reopen the proceedings which had gone on till then.
The High Court has not adverted to any such exceptional circumstance.
The learned Single Judge has not set out any justifiable reason for observing that the principles of natural justice demanded that all those witnesses whose evidence had been recorded earlier could be recalled at the instance of the United Bank of India and opportunity afforded to the United Bank of India to cross examine them.
The learned Single Judge was in error in observing that the United Bank of India was appearing before the Tribunal in its own right and was entitled to protect its own interest.
As already observed by us the proceeding pending before the Tribunal on the date of merger could not be considered as a new proceeding instituted against the United Bank of India on its being impleaded.
It was the same old proceeding to which the Narang Bank of India Ltd. was a party and the rights of the United Bank of India in the conduct of the proceedings could not be larger than the rights which the Narang Bank of India Ltd. itself possessed.
If the Narang Bank of India Ltd. had no right to recall the witnesses who had been examined on behalf of the appellant for cross examination on the date on which the United Bank of India made such prayer before the Tribunal, the United Bank of India also could not be granted permission to do so.
In the absence of any exceptional circumstance which would have entitled in the ordinary course a party to a proceeding to recall a witness whose evidence had already been completed for further cross examination the United Bank of India could not make such a claim at all.
The learned Single Judge who set aside the award in the first instance and the Division Bench which merely affirmed the decision of the learned Single Judge have erred in overlooking the true legal position explained above by us.
On the facts and in the circumstances of the case the United Bank of India was not entitled to recall any of the witnesses examined on behalf of the appellant for further 1098 cross examination particularly after both the parties had closed their respective cases before the Tribunal.
The dismissal of the application made by the United Bank of India for recalling the appellant for further cross examination, in the absence of any exceptional circumstance, could not be considered as a ground for setting aside the award.
The principles of natural justice had not, therefore, been violated by the Tribunal in passing the award.
We, therefore, set aside the judgment of the Division Bench of the High Court and also of the learned Single Judge.
It is, however, mentioned before us that the United Bank of India had some other grounds to urge before the learned Single Judge and the case may be remanded to the learned Single Judge for considering those grounds.
We, therefore, remand this case to the learned Single Judge to consider any other relevant ground that may be urged by the United Bank of India and to dispose of the writ petition in accordance with law.
This appeal is accordingly allowed.
The United Bank of India is directed to pay the costs of the appellant.
N.P.V. Appeal allowed.

summary:
% The appellant joined the service of a Commercial Bank on July 12, 1974 and was confirmed on October 1, 1974.
His services were terminated by the Bank on February 10, 1975 without assigning any reason.
On an industrial dispute being raised, the Central Government, by its order dated July 9, 1975 referred the dispute, as to whether the Bank was justified in terminating his services and if not, what relief the workman was entitled to, to the Central Government Industrial Tribunal for adjudication.
The claim made by the appellant was disputed by the management.
In the course of the trial, the appellant examined himself and was cross examined.
His evidence was closed on 21.5.76.
On July 25, 1976 the Bank entered into an agreement with the first respondent Bank where under all the assets and liabilities of the erstwhile Bank were taken over by the respondent Bank.
The employees of the erstwhile Bank became the employees of the first respondent Bank by virtue of cl. 20 of the said agreement.
On August 1, 1976 the erstwhile Bank totally merged with the first respondent Bank.
Thereafter, on behalf of the former Bank, five witnesses were examined.
On an application made by the appellant, first respondent Bank was impleaded as a party, in view of the merger which had taken place.
Thereafter, the first respondent Bank examined its Personnel Officer and formally closed the evidence.
On October 3, 1978 the first respondent Bank submitted an application for cross examining the appellant whose evidence had been 1089 closed on May 21, 1976.
The Tribunal dismissed the application on the ground that since no new plea had been taken there was no ground to recall the appellant and subject him to further cross examination.
The Tribunal made the award on January 30, 1981 holding that the termination of the service of the appellant was not justified and was bad, illegal and not enforceable.
The first respondent Bank filed a writ petition before the High Court.
A Single Judge set aside the award on the ground that when once a person was impleaded as a party to the proceedings, principles of natural justice required that he should be given an opportunity to crossexamine those witnesses whose evidence had been recorded earlier and since the Tribunal had rejected first respondent Bank 's prayer to crossexamine the appellant whose evidence had been closed on May 21, 1976, the award was liable to be quashed.
It, however, remanded the case to the Industrial Tribunal to decide the case again after giving an opportunity to the first respondent Bank to cross examine the appellant and other witnesses.
The Letters Patent Appeal filed by the appellant was dismissed by the Division Bench holding that the first respondent Bank had the right to cross examine the appellant on the sole ground that it had been impleaded as a party after the merger of the erstwhile Bank with the first respondent Bank.
Allowing the appeal, ^ HELD:1.1 There is no express provision, corresponding to Rule 10 Order 22 of the Code of Civil Procedure, 1908 providing that in cases of an assignment, creation or devolution of any interest during the pendency of a suit, the suit may, by leave of the court, be continued by or against the person who or upon whom such interest has come or devolved, which is applicable to the proceedings before the Industrial Tribunal.
[1095B C] 1.2 In every case of transfer, merger, takeover or scheme of amalgamation, the rights and liabilities of the transferee Company or Corporation shall be the same as that of the tansferor company or corporation, and subject to the terms and conditions of the contract of transfer or merger, the scheme of amalgamation and the legal provisions as the case may be under which such a transaction may have taken place, the transferee company or corporation becomes liable to be impleaded or becomes entitled to be impleaded in place of or in addition to the transferor company or corporation in any action, suit or proceeding 1090 filed against or by the transferor company or corporation by or against a third party, and that whatever steps have already taken place in those proceedings will continue to operate against and be binding on such parties in any of the ways mentioned in Rule 10 Order 22 of the Code of Civil Procedure, 1908.
[1095F H, 1096A B] 1.3 Generally speaking, an assignee cannot set up a case inconsistent with the one put forward by his assignor and it is only in exceptional cases that an assignee could be permitted to raise any new plea and that too only for avoiding multiplicity of the proceedings.
[1097B] In the instant case, by reason of impleading the first respondent as a party there was no change in the character of the proceedings pending before the Tribunal.
The respondent Bank only stepped into the shoes of the erstwhile Bank and all the proceedings that had gone on till the date on which the respondent Bank was so impleaded were binding on the respondent Bank.
It was bound by the proceedings which had taken place till then and could not go back on the proceedings.
[1096G H; 1097A] The Single Judge was in error in taking the view that the first respondent Bank was appearing before the Tribunal in its own right and was entitled to protect its own interest.
The proceeding pending before the Tribunal on the date of merger could not be considered as a new proceeding instituted against the respondent Bank, on its being impleaded.
It was the same old proceeding to which the erstwhile Bank was a party and the rights of the respondent Bank in the conduct of the proceedings could not be larger than the rights which the erstwhile Bank itself possessed.
[1097D E] There were no such exceptional circumstances which entitled the respondent Bank to put up a plea different from the pleas which had already been taken up by the erstwhile Bank and there was also no need to permit it to reopen the proceedings which had gone on till then.
Therefore, in the absence of any exceptional circumstances which would have entitled the party to a proceeding to recall a witness whose evidence had already been completed for further cross examination, the first respondent Bank could not make such a claim at all.
The Single Judge who set aside the award and the Division Bench, which merely affirmed the decision, have erred in overlooking the true legal position.
[1097B,G] 1091 On the facts and in the circumstances of the case the respondent Bank was, therefore, not entitled to recall any of the witnesses examined on behalf of the appellant for further cross examination, particularly after both the parties had closed their respective cases before the Tribunal.
The dismissal of the application made by the respondent for recalling the appellant for further cross examination, in the absence of any exceptional circumstances, could not be considered as a ground for setting aside the award.
The principles of natural justice had not, therefore, been violated by the Tribunal in passing the award.
[1097H, 1098A B] The judgment of the Division Bench as also of the Single Judge set aside.
However, as the respondent Bank had some other grounds to urge before the Single Judge, the case is remanded to the Single Judge to consider any other relevant ground that may be urged by the respondent Bank and to dispose of the writ petition.
[1098B C]


judgement:
ION: Civil Appeal No. 914 of 1987.
From the Judgment and Order dated 22.8.1984 of the Kerala High Court in O.P. No. 6806 of 1984.
Abdul Khader and E.M.S. Anam for the Appellant.
1081 G. Vishwanath Iyer, N. Sudhakaran for the Respondent.
The Judgment of the Court was delivered by JAGANNATHA SHETTY, J.
A tea estate of 100 acres with some buildings, machinery and equipments was given as security to the Kerala Financial Corporation ("The Corporation") against the loan taken by the appellant.
A part of the loan remained outstanding and the appellant could not clear it.
The Corporation thereupon filed O.A. No. 8/64 before the District Court of Kottayam for recovery of the arrears and obtained decree for an amount of Rs.1,20,000.
In execution of the decree, the said tea estate was brought for sale by court auction.
On November 5, 1969, the auction sale was held.
There was no bidder.
So the Corporation itself had to purchase the property for about Rs.1,65,000.
There was long standing dispute between the workmen of the estate and the previous management relating to payment of their wages.
The Corporation therefore could not take possession of the estate.
An extent of 85 acres out of 100 acres of the estate was in possession of the workmen as per settlement arrived at between the Labour Commissioner and the District Collector.
The workmen used to collect the income therefrom towards their wages.
This arrangement continued for about thirteen years.
On January 7, 1982, the Corporation got possession of the entire estate.
The Corporation wanted to recover its amount.
It was not interested in the property.
It therefore, invited tenders for the sale of the estate.
On March 19, 1982, a tender notification was published in dailies like Malayala Manorama, Mathrubhoomi and Deepika newspapers.
In response to the notification, the daughter in law of the appellant was the only tenderer.
She offered Rs.5,10,505.
The Corporation accepted the tender.
It was subsequently found that the daughter in law was no better than the appellant.
She also could not pay any amount.
On January 18, 1983, the Corporation again invited tenders for the sale of the property.
The notification was published in the said newspapers as it was done earlier.
This time, the Corporation received these tenders: (i) T.M. Hassan Rawther (Appellant before us) for Rs. six lakhs; (ii) P.M. Jacob for Rs.4,15,550 and (iii) K.K. Mathew for Rs.2,07,451.
Since the appellant submitted the highest offer, the Corporation naturally had to accept it.
On March 2, 1983, the acceptance was communicated to the appellant.
He must have thanked his stars for getting back his family property which was so dear to him or which was according to him so valuable.
But there was no such anxiety shown.
He did not pay anthing except the earnest money of Rs.40,000.
1082 The Corporation, however, extended the time for payment again and again.
The Corporation also gave him instalments for payment of the balance price.
All the efforts of the Corporation failed to induce the appellant.
The Corporation wanted to get back its money.
It was not interested in retaining the property.
So it negotiated with P.M. Jacob who had submitted his tender alongwith the appellant in response to the notification dated January 18, 1983.
He had then offered Rs.4,16,550.
His tender was the next best.
After negotiation, he enhanced the offer to Rs. four and a half lakhs.
The Corporation accepted it and decided to sell the property to P.M. Jacob.
The property however, was sold to M/s. Gumraj Plantations at the request of P.M. Jacob.
M/s. Gumraj Plantations is a partnership firm in which P.M. Jacob is one of the partners.
The appellant who could not purchase the said property by any means filed suit O.S. No. 229/84 before the Munsif Court Thidupuzha to restrain the Corporation from selling the property.
He could not get relief in the suit since by then the sale deed was executed in favour of M/s. Gumraj Plantations.
Subsequently, he moved the High Court of Kerala complaining that the Corporation while selling the property for Rs. four and a half lakhs to M/s. Gumraj Plantations, had deviated from the normal practice of inviting tenders from the public.
He contended that the Corporation being a public authority was bound to act reasonably and fairly and it ought not to have arbitrarily selected the purchaser.
The High Court found no substance in those submissions.
The High Court observed: "The submission made by the petitioner 's counsel is that the decision to sell the property by private negotiations is arbitrary and is therefore liable to be interfered with by this court.
This is clearly a case where in execution proceedings the decreeholder has purchased the property and thereafter the property was sold in public auction to the petitioner, who purchased it for Rs. six lakhs but failed to pay the sale amount in spite of the fact that this court and afterwards the corporation had shown great indulgence towards the petitioner.
This is not at all a fit case for interference under article 226 of the Constitution." Being aggrieved by the judgment of the High Court, the appellant has preferred the present appeal.
On May 18, 1985, this Court 1083 while entertaining the appeal issued notice limited to the question whether the sale of the property should be made by general auction.
This Court further directed that in any event, the appellant will not be allowed to participate in the auction.
Very interesting turn of events.
The appellant who miserably failed to secure the property for himself is now interested in securing the best price for the Corporation.
He says that this is a public interest litigation.
His case is that the Corporation in all fairness must dispose of the property by public auction.
It could not have bargained with P.M. Jacob and sold the property to M/s. Gumraj Plantations.
Before the High Court, the appellant attacked the sale also on the ground that it was actuated by extraneous considerations.
He alleged that the corporation had succumbed to the pressure of some influential persons for the sale of the property in favour of M/s. Gumraj Plantations.
The appellant made these allegations but did not substantiate it.
He did not give the names of influential persons who had brought pressure on the Corporation.
He did not even state as to how the Corporation officials had shown undue interest with P.M. Jacob or with the other partners of M/s. Gumraj Plantations for sale of the property.
It is not proper to make such light hearted and vague allegations against the statutory authorities.
These allegations, in our opinion, are uncharitable and unfounded.
The only question that arises for consideration is whether on the facts and in the circumstances, the Corporation was not justified in selling the property by private negotiations in favour of M/s. Gumraj Plantations at the instance of P.M. Jacob.
It is needless to state that the Government or public authorities should make all attempts to obtain the best available price while disposing of public properties.
They should not generally enter into private arrangements for the purpose.
These principles may be taken as well established by the following decisions of this Court: (i) K.N. Guruswamy vs The State of Mysore and others; , at 312; (ii) Mohinder Singh Gill & Anr.
vs The Chief Election Commissioner, New Delhi and others, ; (iii) R.D. Shetty vs The International Airport Authority of India and Ors., ; ; (iv) Kasturi Lal Lakshmi Reddy vs State of Jammu and Kashmir and Anr., ; ; (v) Fertilizer Corporation Kamagar Union vs Union of India, ; ; (vi) Ram and Shyam Company vs State of Haryana and Ors.
[1985] Supp.
SCR 541 and (vii) Shri Sachidanand Pandey vs State of W.B. ; 1084 In R.D. Shetty vs The International Airport Authority of India and Ors.
; at 1041 Bhagwati, J. speaking for the Court observed: "Now, obviously where a corporation is an instrumentality or agency of Government, it would, in the exercise of its power or discretion, be subject to the same constitutional or public law limitations as Government.
The rule inhibiting arbitrary action by Government which we have discussed above must apply equally where such corporation is dealing with the public, whether by way of giving jobs or entering into contracts or otherwise, and it cannot act arbitrarily and enter into relationship with any person it likes at its sweetwill, but its action must be in conformity with some principle which meets the test of reason and relevance.
This rule also flows directly from the doctrine of equality embodied in Art 14.
It is now well settled as a result of the decisions of this Court in E.P. Rayappa vs State of Tamil Nadu and Maneka Gandhi vs Union of India that Article 14 strikes at arbitrariness in State action and ensures fairness and equality of treatment.
It requires that State action must not be arbitrary but must be based on some rational and relevant principle which is non discriminatory: it must not be guided by any extraneous or irrelevant considerations, because that would be denial of equality.
The principle of reasonableness and rationality which is legally as well as philosophically an essential element of equality or non arbitrariness is protected by article 14 and it must characterise every State action, whether it be under authority of law or in exercise of executive power without making of law.
The State cannot, therefore, act arbitrarily in entering into relationship, contractual or otherwise with a third party, but its action must conform to some standard or norm which is rational and non discriminatory.
" In Kasturi Lal Lakshmi Reddy vs State of J & K, ; at 1355 Bhagwati, J. again speaking for the Court reiterated what he said earlier to R.D. Shetty case.
The learned Judge went on to state: 1085 "Every action taken by the Government must be in public interest; the Government cannot act arbitrarily and without reason and if it does, its action would be liable to be invalidated.
If the Government awards a contract or leases out or otherwise deals with its property or grants any other largess, it would be liable to be tested for its validity on the touch stone of reasonableness and public interest and if it fails to satisfy either test, it would be unconstitutional and invalid.
" The learned Judge continued (at p. 1357): "But one basic principle which must guide the Court in arriving at its determination on this question is that there is always a presumption that the Governmental action is reasonable and in public interest and it is for the party challenging its validity to show that it is wanting in reasonableness or is not informed with public interest.
This burden is a heavy one and it has to be discharged to the satisfaction of the Court by proper and adequate material.
The Court cannot lightly assume that the action taken by the Government is unreasonable or without public interest because as we said above, there are a large number of policy considerations which must necessarily weigh with the Government in taking action and therefore, the Court would not strike down governmental action as invalid on this ground, unless it is clearly satisfied that the action is unreasonable or not in public interest.
But where it is so satisfied it would be the plainest duty of the Court under the Constitution to invalidate the governmental action.
This is one of the most important functions of the Court and also one of the most essential for preservation of the rule of law.
" In Fertilizer Corporation case ; at 350 this Court speaking through Chandrachud, C.J., observed: "We want to make it clear that we do not doubt the bona fides of the authorities, but as far as possible, sales of public property, when the intention is to get the best price, ought to take place publicly.
The vendors are not necessarily bound to accept the highest or any other offer, but the public at least gets the satisfaction that the Government has 1086 put all its cards on the table.
In the instant case, the officers who were concerned with the sale have inevitably, though unjustifiably attracted the criticism that during the course of negotiations the original bid was reduced without a justifying cause.
We had willy nilly to spend quite some valuable time in satisfying ourselves that the reduction in the price was a necessary and fair consequence of the reduction in the quantity of the goods later offered for sale on March 31, 1980.
One cannot exclude the possibility that a better price might have been realised in a fresh public auction but such possibilities cannot vitiate the sale or justify the allegations of malafides.
" In Shri Sachidanand Pandey vs State of West Bengal, ; at 1133, O. Chinnappa Reddy, J. after considering almost all the decisions of this Court on the subject summarised the propositions in the following terms: "On a consideration of the relevant cases cited at the bar the following propositions may be taken as well established: State owned or public owned property is not to be dealt with at the absolute discretion of the executive.
Certain percepts and principes have to be observed.
Public interest is the paramount consideration.
One of the methods of securing the public interest when it is considered necessary to dispose of a property, is to sell the property by public auction or by inviting tenders.
Though that is the ordinary rule, it is not an invariable rule.
There may be situations where there are compelling reasons necessitating departure from the rule but then the reasons for the departure must be rational and should not be suggestive of discrimination.
Appearance of public justice is as important as doing justice.
Nothing should be done which gives an appearance of bias, jobbery or nepotism." After applying these tests, the learned Judge finally upheld the action of West Bengal Government in not inviting tenders, or in not holding a public auction but negotiating straightway at arms length with Taj Group of Hotels for giving about four acres of land for establishing a five star hotel.
The public property owned by the State or by any instrumentality of the State should be generally sold by public auction or by inviting 1087 tenders.
This Court has been insisting upon that rule, not only to get the highest price for the property but also to ensure fairness in the activities of the State and public authorities.
They should undoubtedly act fairly.
Their actions should be legitimate.
Their dealings should be above board.
Their transactions should be without aversion or affection.
Nothing should be suggestive of discrimination.
Nothing should be done by them which gives an impression of bias, favouritism or nepotism.
Ordinarily these factors would be absent if the matter is brought to public auction or sale by tenders.
That is why the Court repeatedly stated and reiterated that the State owned properties are required to be disposed of publicly.
But that is not the only rule.
As O.Chinnappa Reddy, J. Observed "that though that is the ordinary rule, it is not an invariable rule.
" There may be situations necessitating departure from the rule, but then such instances must be justified by compulsions and not by compromise.
It must be justified by compelling reasons and not by just convenience.
What is the position in the present case.
Here is a case where the Corporation invited tenders for the sale of the property under notification dated January 18, 1983.
The appellant submitted the highest tender in response to the said notification.
He was given all concessions for payment of the tender amount.
But he did not.
He negotiated with the Managing Director of the Corporation for facilities for payment by instalments.
That was also granted to him.
There again he failed.
If the appellant could not act according to his tender, we fail to see why the property should not be offered to the person who was next in order.
The Corporation, in our opinion, did not do anything unfair with P.M.Jacob.
The Corporation got the tender amount raised from Rs.4,16,550 to Rs.4,50,000.
It shows the fairness with which the Corporation dealt with the property.
On a consideration of all the facts and circumstances of the case, we are satisfied that the action of the Corporation in offering the property to P.M.Jacob and selling the same at his request to M/s. Gumraj Plantations was perfectly justified and cannot be found fault with In the result the appeal fails and is dismissed.
In the circumstances, however, we make no order as to costs.
P.S.S. Appeal dismissed.

dataset_name: IN-Abs

summary:
% The respondent, a State Government Corporation obtained decree for certain amount against the appellant and in execution proceedings a tea estate was brought for sale by court auction in 1969, but in the absence of a bidder the respondent itself had to purchase it at a higher price.
The respondent, however, could take possession of the estate only in 1982.
It then invited tenders for the sale of the estate.
The appellant offered Rs.6,00,000.
The next best offer was for Rs.4,15,550 and the third for Rs.2,07,451.
The highest offer was accepted, but the appellant could not pay the amount except the earnest money, even after repeated extension of time and offer to receive the balance in instalments.
The respondent then negotiated with the next highest bidder, who enhanced the offer to Rs.4,50,000 which was accepted by the respondent.
The property, however, was sold to a partnership firm in which the said bidder was a partner.
The appellant thereupon moved the High Court complaining that the respondent in selling the property to the firm had deviated from the normal practice of inviting the tenders from the public and that the Corporation being a public authority was bound to act reasonably and fairly and it ought not be have arbitrarily selected the purchaser.
The High Court declined to interfere.
Dismissing the appeal, ^ HELD: The action of the respondent in offering the property to the person next in order by private negotiations and selling the same at 1080 his request to the partnership firm was perfectly justified.
[1087G] The public property owned by the State or by any instrumentality of the State should be generally sold by public auction or by inviting tenders, not only to get the highest price for the property but also to ensure fairness in the activities of the State and public authorities.
They should act fairly.
Their actions should be legitimate.
Their dealings should be above board.
Their transactions should be without aversion or affection and should not be suggestive of discrimination, bias, favouritism or nepotism.
Ordinarily these facts would be absent if the matter is brought to public auction or sale by tenders.
Though that is the ordinary rule, it is not an invariable rule.
There may be situations necessitating departure from the rule, but then such instances must be justified by compelling reasons and not by just convenience.
[1086H; 1087A C] In the instant case, the respondent dealt with the property in all fairness.
It invited tenders for the sale of the property under the notification.
The appellant submitted the highest tender in response to the said notification.
He was granted all concessions and facilities for payment by instalments but he failed.
If the appellant could not act according to his tender, there was no reason why the property should not be offered to the person who was next in order.
The respondent, therefore, did not do anything unfair with the second bidder after it had got the tender amount raised substantially.
[1087D F] K.N. Guruswamy vs The State of Mysore & Ors., ; at 312; Mohinder Singh Gill & Anr.
vs The Chief Election Commissioner, New Delhi & Ors., ; R.D. Shetty vs The International Airport Authority of India State of Jammu and Kashmir & Anr., ; ; Fertilizer Corporation Kamagar Union vs Union of India, ; ; Ram and Shyam Company vs State of Haryana & Ors., and Shri Sachidanand Pandey vs State of W. B. ; , applied.


judgement:
Civil Appeal No. 146 of 1981.
From the Judgment and Order dated 10.5.1979 of the Allahabad High Court in S.A. No. 512 of 1975.
M.K. Ramamurthi, Syed Ali Ahmad, Mrs. Jayashree Ahmad, Syed Tanweer Ahmad and Mohan Pandey for the Appellant.
V.C. Mahajan, Hemant Sharma and C.V. Subba Rao for the Respondent.
1104 The Judgment of the Court was delivered by SINGH, J.
The short question which arises in this appeal is whether the disciplinary proceedings taken against the appellant resulting in his dismissal are null and void as the Enquiry Officer failed to comply with the principles of natural justice in holding the enquiry.
The question relating to the non compliance of principles of natural justice is founded on the grievance that a copy of paper No. 5 although mentioned in the memo of charges was not supplied to the appellant, and that he was not permitted to inspect the same.
A learned single Judge of the High Court has answered the question against the appellant.
Hence this appeal.
The appellant was posted as fireman at Moghulsarai in Northern Railway in May, 1964.
On 28th May 1964 coal lying at Pusauli Station was fraudulently removed by some person giving out his name as Shambhu Tiwari.
A criminal case was registered, but on account of absence of reliable evidence, a final report was submitted.
It appears that during the preliminary enquiry held by the Department it was found that Chandrama Tewari, the appellant had removed the coal lying at Pusauli Station posing himself as Shambhu Tiwari, a coal contractor.
On completion of the preliminary enquiry a charge sheet was issued to the appellant on 6.2.1967.
The appellant filed reply to the charges denying the same.
An Enquiry Officer was appointed before whom evidence was recorded and the appellant was afforded full opportunity of cross examining the witnesses.
The Enquiry Officer submitted his report holding the appellant guilty of charges framed against him.
The punishing authority accepted the enquiry report and issued orders on 27.6.1969 dismissing the appellant from the service.
The appellant filed a civil suit in the Trial Court for a declaration that the punishment of dismissal awarded to him was illegal and unconstitutional mainly on the ground that the enquiry had been held in violation of the principles of natural justice and he was denied reasonable opportunity of defence.
A number of other grounds were also raised in the suit which need not be adverted as the controversy now is confined to the question of violation of the principles of natural justice alone.
The trial court decreed the appellant 's suit on 31.1.1974.
The decree of the trial court was confirmed in appeal by the District Judge by his order dated 2.11.1974.
On a second appeal being filed by the Union of India the High Court set aside the judgment and decree of the subordinate courts on the findings that the appellant had been afforded reasonable opportunity of defence and there was no violation of any principles of natural justice in the enquiry.
1105 Learned counsel for the appellant Shri M.K. Ramamurthy contended that the memo of charges issued to the appellant expressly mentioned that paper No. 5 was proposed to be relied by the Department against the appellant but in spite of demand being made by the appellant a copy of that document was not supplied to him nor was he permitted to inspect the same.
In the absence of that document the appellant was handicapped in cross examining Shri A.C. Das, Dy.
S.P., S.P.E. He further urged that failure to supply the copy of paper No. 5 was in violation of the principles of natural justice rendering the proceedings, resulting in the order of dismissal as void.
He placed reliance on decisions of this Court in State of Madhya Pradesh vs Chintaman, AIR 1961 SC 1623; Trilokinath vs Union of India & Ors., ; The State of Assam & Anr.
vs Mahendra Kumar Das & Ors., ; ; State of Punjab vs Bhagat Ram, ; ; State of Uttar Pradesh vs Mohd. Sharif; AIR 1982 SC 937 and Kashinath Dikshita vs Union of India & Ors.
, We have given our anxious consideration to the submissions made on behalf of the appellant and we have further considered the aforesaid authorities referred to by the learned counsel for the appellant but we do not find any merit in the appellant 's submissions to justify interference with the High Court 's judgment.
Article 311 of the Constitution requires that reasonable opportunity of defence must be afforded to a government servant before he is awarded major punishment of dismissal.
It further contemplates that disciplinary enquiry must be held in accordance with the Rules in a just and fair manner.
The procedure at the enquiry must be consistent with the principles of natural justice.
Principles of natural justice require that the copy of the document if any relied upon against the party charged should be given to him and he should be afforded opportunity to cross examine the witnesses and to produce his own witnesses in his defence.
If findings are recorded against the government servant placing reliance on a document which may not have been disclosed to him or the copy whereof may not have been supplied to him during the enquiry when demanded would contravene principles of natural justice rendering the enquiry, and the consequential order of punishment illegal and void.
These principles are well settled by a catena of decisions of this Court.
We need not refer to them.
However, it is not necessary that each and every document must be supplied to the delinquent government servant facing the charges instead only material and relevant documents are necessary to be supplied to him.
If a document even though mentioned in the memo of charges is not relevant to the charges or if it is not referred to or relied upon by the enquiry officer or the punishing 1106 authority in holding the charges proved against the government servant, no exception can be taken to the validity of the proceedings or the order.
If the document is not used against the party charged the ground of violation of principles of natural justice cannot successfully be raised.
The violation of principles of natural justice arises only when a document, copy of which may not have been supplied to the party charged when demanded is used in recording finding of guilt against him.
On a careful consideration of the authorities cited on behalf of the appellant we find that the obligation to supply copies of documents is confined only to material and relevant documents and the enquiry would be vitiated only if the non supply of material and relevant documents when demanded may have caused prejudice to the delinquent officer.
In State of Madhya Pradesh vs Chintaman, the respondent who was a police officer was dismissed from service on certain charges.
The High Court of Madhya Pradesh quashed the order of dismissal on the finding that the enquiry was held in violation of the principles of natural justice in as much as the statement of witnesses recorded in the preliminary enquiry were not supplied to the concerned officer as a result of which he could not effectively cross examine the witnesses produced before the enquiry officer.
This Court while upholding the view taken by the High Court, observed that the departmental enquiries should observe rules of natural justice.
The Court referred to the observations of Venkatarama Aiyar, J. in Union of India vs T.R. Verma, [1958] SCR 499 "stating it broadly and without intending it to be exhaustive it may be observed that rules of natural justice require that a party should have the opportunity of adducing all relevant evidence on which he relies, that the evidence of the opponent should be taken in his presence, and that he should be given the opportunity of cross examining the witnesses examined by that party, and that no material should be relied on against him without his being given an opportunity of explaining them".
Relying on the aforesaid observations the Court held that right to cross examine witnesses who give evidence against a delinquent officer is a very valuable right and if effective exercise of that right is prevented by the enquiry officer by not giving to officer relevant document to which he is entitled, the enquiry cannot be said to have been held in accordance with the principles of natural justice.
In Triloki Nath vs Union of India, it was held that if a public servant facing enquiry was not supplied copies of documents it would amount to denial of reasonable opportunity.
In that case the statement of witnesses recorded during the investigation of the criminal case registered against the delinquent officer prior to the 1107 departmental proceedings had not been supplied to him, as a result of which the delinquent officer was prejudiced in his defence at the enquiry.
In State of Assam and Anr.
vs Mahendra Kumar Das & ors.
J dismissal of a police sub inspector in pursuance of a disciplinary enquiry held against him had been set aside by the High Court on the ground that the enquiry officer had during the course of the enquiry consulted the Superintendent of Police, Anti Corruption Branch and had taken into consideration certain material gathered from the AntiCorruption Branch, without making the said material available to the sub inspector.
On appeal by the State of Assam this Court held that it was improper for an enquiry officer during the conduct of an enquiry to collect any material from outside sources and in not making that material available to the delinquent officer.
The Court observed that if the enquiry officer collects material behind the back of the delinquent officer and such material is relied upon by the enquiry officer without being disclosed to the delinquent officer, the enquiry proceedings would be vitiated.
After making these observations this Court recorded a finding that the enquiry officer had not taken into consideration the material contained in the records of Anti Corruption Branch, and therefore failure to supply the material of the AntiCorruption Branch to the delinquent officer was of no consequence and it could not vitiate the enquiry.
The Court set aside the order of the High Court on the finding that there had been no violation of principles of natural justice.
In State of Punjab vs Bhagat Ram, copies of statement of witnesses recorded during investigation and produced at the disciplinary enquiry in support of the charges framed against the delinquent officer were not supplied, instead a synopsis of the statements had been supplied to him.
This Court upheld the order of the High Court on the finding that it was unjust and unfair to deny the government servant copies of statement of witnesses recorded during investigation and produced in support of the charges levelled against the government servant.
In the absence of the copies of the statement of witnesses the government servant could not have opportunity of effective and useful cross examine of the witnesses produced during the disciplinary enquiry.
The Court observed that synopsis of statement did not satisfy the requirement of giving the government servant a reasonable opportunity.
Same view was taken by this Court in State of Uttar Pradesh vs Mohd. Sharif, as in that case also copies of the statement of witnesses recorded at the preliminary enquiry were not furnished to 1108 the delinquent government officer, as a result of which the delinquent officer could not effectively cross examine the witnesses before the enquiry officer.
In Kashinath Dikshita vs Union of India & ors., this Court set aside the order of dismissal of a police officer on the finding that during the departmental proceedings the officer concerned was not supplied the copies of statements made by the witnesses at a pre enquiry stage and also the copies of the documents on which reliance was placed in support of the charges, in spite of specific request being made by the officer.
The Court held that the order of dismissal was violative of Article 311 (2) in as much as the officer had been denied reasonable opportunity of defending himself.
While setting aside the order of dismissal the Court observed that whether or not refusal to supply copies of documents or statements has resulted in prejudice to an officer facing the departmental enquiry depends on the facts of each case.
After making this observation the Court examined the circumstances of that case and concluded that since 38 witnesses were examined against the officer and a large number of documents were relied upon against him and the disciplinary authority should have supplied the copies of the statement of witnesses recorded during the preliminary enquiry as we as the copies of the documents.
Wherein agreement with the view taken in this decision It is now well settled that if copies of relevant and material documents including the statement of witnesses recorded in the preliminary enquiry or during investigation are not supplied to the delinquent officer facing the enquiry and if such documents are relied in holding the charges proved against the officer, the enquiry would be vitiated for the violation of principles of natural justice.
Similarly, if the statement of witnesses recorded during the investigation of a criminal case or in the preliminary enquiry is not supplied to the delinquent officer, as that would amount to denial of opportunity of effective cross examination.
It is difficult to comprehend exhaustively the facts and circumstances which may lead to violation of principles of natural justice or denial of reasonable opportunity of defence.
This question must be determined on the facts and circumstances of each case.
While considering this question it has to be borne in mind that a delinquent officer is entitled to have copies of material and relevant documents only which may include the copy of statement of witnesses recorded during the investigation or preliminary enquiry or the copy of any other document which may have been relied in support of the charges.
If a document has no bearing on the charges or if it is not relied by the 1109 enquiry officer to support the charges, or if such document or material was not necessary for the cross examination of witnesses during the enquiry, the officer cannot insist upon the supply of copies of such documents, as the absence of copy of such document will not prejudice the delinquent officer.
The decision of the question whether a document is material or not will depend upon the facts and circumstances of each case.
In the instant case there is no denying the fact that a copy of paper No. 5 as mentioned in the charge sheet was not supplied to the appellant and he was not permitted to inspect the same.
It appears that paper No. 5 was the report submitted by the Special Police Establishment in respect of the criminal case of theft of coal, in which final report had been submitted.
After submission of final report in the criminal case disciplinary enquiry was initiated against the appellant.
Paper No. 5 (the report) was, however, not considered or relied by the enquiry officer in recording findings against the appellant.
We have perused the copy of the report of the enquiry officer furnished to the Court by the appellant but we do not find any reference to paper No. 5 therein.
The enquiry officer has not either referred to nor relied upon that report in recording findings on the charges framed against the appellant.
In this view the report (paper No. 5) was not a material or relevant document and denial of copy of that document could not and did not prejudice the appellant and there was no violation of principles of natural justice.
The appellant 's grievance that in the absence of report he could not effectively cross examine Shri A.C. Das, Dy.
S.P. Of Special Police Establishment, the investigating officer, is not sustainable.
A copy of the statement as recorded by the enquiry officer has been placed before us by the appellant on a perusal of the same we find that Shri A.C. Das, was cross examined at length in detail.
His examination in chief is confined to one page while his cross examination runs into six full scape typed pages.
The appellant has failed to point out as to how he was prejudiced.
In our opinion the appellant was not handicapped in cross examining Shri A.C. Das, his grievance that he was not afforded reasonable opportunity of defence is without any merit.
In view of the above discussion we hold that the High Court was right, in holding that the enquiry was fair and the principles of natural justice had not been violated.
The appeal fails and is accordingly dismissed.
There will be no order to costs.
S.L. Appeal dismissed.

summary:
% Coal lying at the Pusauli Railway Station was fraudulently removed by some person, giving out his name as Shambhu Tiwari, a coal contractor.
A criminal case was registered, but on account of absence of reliable evidence final report was submitted.
During the preliminary enquiry held by the Department, it was found that Chandrama Tewari, the appellant, who was posted as a fireman at Moghulsarai in the Northern Railway, had removed the coal posing himself as Shambhu Tiwari.
A charge sheet was issued to the appellant.
An Enquiry Officer was appointed before whom evidence was recorded.
The appellant was afforded full opportunity of cross examining the witnesses.
The Enquiry Officer held the appellant guilty of the charges framed against him.
The punishing authority accepted the report of the enquiry officer and passed orders, dismissing the appellant from service.
The appellant filed a civil suit for a declaration that the punishment of dismissal was illegal and unconstitutional mainly on the ground that the enquiry had been held in violation of the principles of natural justice and he was denied reasonable opportunity of defence, inasmuch as a copy of paper No. 5, mentioned in the Memo of charges, had not been supplied to him.
The trial court decreed the suit.
The decree of the trial court was confirmed in appeal by the District Judge.
On a second appeal by the Union of India, the High Court set aside the decisions of the subordinate courts, holding that the appellant had been afforded reasonable opportunity of defence and there had been no violation of the principles of natural justice in the enquiry.
The appellant appealed to this Court against the order of the High Court.
Dismissing the appeal, the court, 1103 ^ HELD: It is not necessary that each and every document must be supplied to the delinquent government servant facing charges; instead, only material and relevant documents are necessary to be supplied to him.
If a document even though mentioned in the Memo of charges is not relevant to the charges or if it is not referred to or relied upon by the enquiry officer or the punishing authority in holding the charges proved against the government servant, no exception can be taken to the validity of the proceedings or the order passed on the ground of non supply of the copy of the order.
If a document is not used against the party charged, the ground of violation of principles of natural justice cannot be successfully raised.
Violation of the principles of natural justice arises only when a document, a copy of which may not have been supplied to the party charged, is used in recording findings of guilt against him.
[1105G H; 1106A B] Copy of paper No. 5, mentioned in the charge sheet, was not supplied to the appellant and he was not permitted to inspect the same.
But that document was not considered, or relied upon by the enquiry officer in recording the findings against the appellant.
Therefore, the paper No. 5 was not a material or relevant document, and denial of a copy of that document did not prejudice the appellant and there was no violation of the principles of natural justice involved in the case.
The enquiry was fair.
[1109D E] State of Madhya Pradesh vs Chintaman, AIR 1961 SC 1623; Trilokinath vs Union of India and Ors., ; State of Assam & Anr.
vs Mahendra Kumar Das & Ors., ; ; State of Punjab vs Bhagat Ram, ; ; State of Uttar Pradesh vs Mohd. Sharif, AIR 1982 SC 937 and Kashinath Dikshita vs Union of India and Ors., ; relied upon by the appellant.


judgement:
Petitions (Civil) Nos.
5117/ 81, 7340/81, 3656 84/82, 6381 82, 6951 52/82, 8010 19/82, 8108 11/82, 90 19 20/82, 5241 60/83, 1734 35/83 and 559 560/83.
(Under Article 32 of the Constitution of India).
B. Kanta Rao for the Petitioners.
C. Seetharamiah, T.V.S.N. Chari, Ms. Vrinda Grover, Ch.
Badri Nath, A.K. Sanghi, G.S. Chatterjee P.N. Mishra, A.V Rangam, Pramod Swarup, D. Goburdhan and M.N. Shroff for the Respondents.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
W.P.
Nos: 5117/81, 3656 84/82, 5241 5260/83.
& 7340/81 These four batches of Writ Petitions challenge the imposition of sales tax on bread, rusk and bun under the A.P. Sales Tax Act 1957 as illegal.
The main and the first contention was that the bread and biscuits belong to one homogeneous class but these have been differently treated for taxation under Schedule I, Item No. 117 and Schedule I, Item No. 129 of the said Act.
In other words, the contention of the petitioners is that the bread and biscuits are the same, they should not be differently taxed.
The purchasers and sellers of bread and biscuits have been differently taxed In support of this contention reliance was placed on certain decisions of this Court, namely: State of Andhra Pradesh & Anr.
vs Nalla Raja Reddy & Ors., ; ; New Manek Chowk Spinning and Weaving Mills Co. Ltd. and Ors.
vs Municipal Corporation of the City of Ahmedabad and others; , We do not find any proposition in those decisions in support of this contention of the petitioners.
The decision of the Allahabad High Court in Annapurna Biscuit (Mfg.) Co. and Another vs The State of U.P. and Another, [1975] 35 S.T.C. 9 127 does not deal with this contention at all.
A The second contention sought to be raised was that the multiple point tax violates Article 19(1)(g) of the Constitution.
The petitioners being Bakeries, this contention is not open to the petitioners.
The third contention sought to be raised was that excise duty and sales tax are imposed on the same items.
This also does not arise in the case of the petitioners who are Bakeries.
Apart from that the taxable events in these two impositions are different.
So this contention cannot in any event be raised.
The fourth contention sought to be raised was the surcharge.
This point in our opinion does not arise.
Furthermore this point is concluded by the observations of this Court in the case of Hoechst Pharmaceuticals Ltd and Another Etc.
vs State of Bihar and others, [1983] 3 S.C.R. 130.
Indeed all these contentions raised on behalf of the petitioners have been negatived by this Court in the aforesaid decision.
We reiterate that the economic wisdom of a tax or lack of it are within the exclusive domain of the legislature.
The only question for the Court to consider it whether there is rationality in that behalf of the legislature that capacity to pay the tax increases by and large with an increase of receipts.
From any point of view there is rationality in this proposition.
It is sound commonsense.
It is in consonance with social justice to which we are committed by our Constitution.
In that view of the matter the challenge to the imposition under Article 14 as well as Article 19(1)(g) of the Constitution are not sustainable.
These Writ Petitions must fail and are dismissed accordingly.
There will be no order as to costs.
Interim orders, if any, are vacated W.P. Nos.
6381 82/82, 6951 52/82, 8010 19/82 8108 11/82, 9019 20/ 82, 1734 35/83 & 559 560/83.
In view of the Judgment in W.P. Nos. 5117/81, 3656 84/82, 524 1 5260/83 and 7340/8 1, these petitions must also fail and are accordingly dismissed.
There will be no order as to costs.
N.P.V. Petitions dismissed.

summary:
% In a batch of Writ Petitions filed in this Court the petitioners challenged the imposition of sales tax and surcharge on bread, rusk and bun under the A.P. Sales Tax Act, 1957 as illegal, contending that bread and biscuits belonged to one homogeneous class but had been treated differently for purposes of taxation under Schedule 1, Item No. 117 and Item No. 129 of the Act, that the purchasers and sellers of bread and biscuits had been differently taxed, and that the multiple point tax violated Article 19(1)(g) of the Constitution.
Dismissing the writ petitions, ^ HELD: The economic wisdom of a tax or lack of it are within the exclusive domain of the legislature.
The only question for the Court to consider is whether there is rationality in that behalf of the legislature that capacity to pay the tax increased by and large with the increase of receipts.
From any point of view, there is rationality in this proposition.
It is sound commonsense and is in consonance with social justice.
Therefore, the challenge to the imposition, under Article 14 as well as Article 19(1)(g) of the Constitution is not sustainable.
[9D F] State of Andhra Pradesh & Anr.
vs Nalla Raja Reddy & Ors. ; ; New Menek Chowk Spinning and Weaving Mills Co. 8 Ltd. and Ors.
vs Municipal Corporation of the City of Ahmedabad and others.
; , ; Annapurna Biscuit (Mfg.) Co. and Another vs The State of U.P. and Another, [1975] 35 S.T.C 127 and Hoechst Pharmaceuticals Ltd. and Another Etc.
vs State of Bihar and others, , referred to.


judgement:
Civil Appeal No. 3031 of 1987.
From the Judgment and order dated 9.7.1985 of the Karnataka High Court in Writ Petition No. 31533 of 1982 12 S.S. Javali, Ravi P. Wadhwani, M.Rangaswamy, N.D.B. Raju, C. K .
Sucharita and Mrs. C.K. Sucharita for the Appellant K.L. Sharma and M. Veerappa for the Respondents.
The Judgment of the Court was delivered by VENKATARAMIAH, J.
Aggrieved by the levy of additional tax under section 8 of the Karnataka Motor Vehicles Taxation Act, 1957 (hereinafter referred to as 'the Act ') in respect of his motor vehicle, which he has been running as a stage carriage under a permit issued under the provisions of the , the appellant herein questioned the levy of the said additional tax before the High Court of Karnataka in Writ Petition No. 31533 of 1982.
That writ petition was dismissed by the High Court following an earlier decision of a Division Bench of that Court in Noorullha Khan vs State of Karnataka (Writ Petition No. 8302 of 1980 and connected cases decided on 26.6.1985).
The appellant has filed this appeal by special leave against the decision of the High Court dismissing his writ petition The facts of the case are briefly these.
The appellant is the registered owner of the motor vehicle which he has been running as a stage carriage under a permit issued by the Regional Transport Authority under the provisions of the .
He is liable to pay tax in respect of the said motor vehicle under section 3 of the Act which provides that a tax at the rates specified in Part A of the Schedule to the Act shall be levied on all motor vehicles suitable for use or roads.
Item 4 in Part A of the Schedule to the Act, as it stood in the year 1985, which related to the levy of tax on motor vehicles which were used as stage carriages reads thus: Class of vehicles Quarterly tax for vehicle fitted with pneumatic tyres ____________________________________________________________ (1) (2) ____________________________________________________________ "4.
Motor Vehicles other than those mentioned in items 5, 6 and 7 plying for hire and used for transport of passengers and in respect of which permits have been issued under the . 13 (i) Vehicles permitted to carry in all: Rs. p. (a) not more than three persons 40.00 (other than the driver) (b) Four persons (other than 75.00 the driver) (c) Five persons (other than 90.00 the driver) (d) Six persons (other than the driver) 200.00 (ii)(1) Vehicles permitted to carry more than six persons and plying exclusively on routes within the limits of cities and towns notified by the Government and other vehicles not falling under (2) below: (a) For every seated passenger 130.00 (other than the driver and the conductor) which the vehicle is permitted to carry.
(b) For every passenger (other than 45.00 the seated passenger, the driver and the conductor) which the vehicle is permitted to carry.
(2) Vehicles permitted to carry more than six persons and the total mileage of which exceeds 100 kilometers per day: (a) For every seated passenger 160.00 (other than the driver and the conductor) which the vehicle is permitted to carry.
(b) For every passenger (other than 45.00 the seated passenger, the driver and the conductor) which the vehicle is permitted to carry.
" 14 Item 5 of part A of the Schedule to the Act, as it stood during the relevant time.
referred to the tax payable by motor vehicles which were used as contract carriages under permits issued under the .
Item 6 of part A of the Schedule to the Act has been repealed.
Item 7 of Part A of the Schedule to the Act, as it stood during the relevant period, dealt with the tax payable in respect of omnibuses It read thus: ____________________________________________________________ Class of Vehicles Quarterly tax for vehicles fitted with pneumatic tyres ____________________________________________________________ (1) (2) ____________________________________________________________ "7.
Omnibuses, Rs. p. (a) permitted to carry not more than 10 50.00 persons (excluding the driver), for every person which the vehicle is permitted to carry: (b) permitted to carry 11 persons or 100.00 more (excluding the driver), for every person which the vehicle is permitted to carry.
The appellant was liable to pay at the time when he filed the writ petition Rs.160.00 per quarter for every seated passenger (other than the driver and the conductor) which the vehicle was permitted to carry and Rs.45 per quarter for every passengers (other than the seated passengers, the driver and the conductor) which the vehicle WAS permitted to carry.
Section 8 of the Act which provides for payment of additional tax in respect of motor vehicles reads thus: "8.
Payment of additional tax When any motor vehicle in respect of which a tax has been paid is altered or proposed to be used in a such a manner as to cause vehicle to become a vehicle in respect of which a higher rate of tax is payable, the registered owner or person who is in possession or control of such vehicle shall pay an additional tax or a sum which is equal to the difference between the tax already paid and the tax which is payable in respect of 15 such vehicle for the period for which the higher rate of tax is payable in consequence of its being altered or so proposed to be used and taxation authority shall not grant a fresh taxation card in respect of such vehicle so altered or proposed to be so used until such amount of tax has been paid.
It appears that on some stray occasions prior to the institution of the writ petition it had been found that in the motor vehicle which the appellant was operating as a stage carriage there were few passengers in excess of the number of passengers which he was allowed to carry under the permit issued to him under the in respect of the said motor vehicle.
The taxation authority under the Act, therefore, issued a demand for payment of additional tax under the provisions of section 8 of the Act on the ground that the appellant had proposed to use the motor vehicle in such a manner as to cause the vehicle to become a vehicle in respect of which a higher rate of tax was payable following the decision of the High Court in Noorullha Khan 's case (supra).
Aggrieved by the said demand he filed the writ petition.
As mentioned above, that petition having been dismissed, this appeal by special leave has been filed.
Since the judgment of the High Court under appeal is based on the decision in Noorullha Khan 's case (supra) it is necessary to set out briefly the facts in that case.
Noorullha Khan who was the petitioner in that case was the registered owner of a motor vehicle classified as an 'omnibus ' with a seating capacity of 15+ 1 under the provisions of the and was subjected to tax on that basis under item 7(b) of Part A of the Schedule to the Act.
He was liable to pay at the rate of Rs. 100 per seat per quarter under the said provision.
He was, however, called upon by the taxation authority to pay an additional sum by way of tax on two different occasions calculating the tax on the basis of the number of passengers carried in the vehicle on those two occasions.
He challenged the said demands before the Deputy Commissioner for Transport in appeal.
That appeal having been dismissed he filed Writ Petition No. 8302 of 1980, referred to above, on the file of the High Court.
The High Court took the view that the petition in that writ petition having used the vehicle on two occasions for carrying passengers in excess of the number of passengers which he was allowed to carry under the permit he had become liable to pay additional tax for the 'proposed user ' of the motor vehicle in a manner different from the manner in which he was permitted to run it.
In support of its decision the High Court 16 relied strongly on the decision in Payne vs Allcock, 119321 2 K B. 413 in which the conviction of the owner of a motor vehicle in respect of which he had obtained a licence to use it as a private motor car for having used it for the conveyance of goods had been upheld.
The is a central act, which was enacted pursuant to Entry 20 of List III of the Seventh Schedule to the Government of India Act, 1935 corresponding to Entry 35 of List III of the Seventh Schedule to the Constitution of India.
The Act under which a tax is leviable on motor vehicles has been enacted by the Karnataka State Legislature in exercise of its powers under Entry 57 of List II of the Seventh Schedule to the Constitution of India.
Thus the scope of the Act and the scope of the are entirely different Section 42 of the provides that no owner of a transport vehicle shall use or permit the use of the vehicle in any public place whether or not such vehicle is actually carrying any passenger or goods save in accordance with the conditions of a permit granted or countersigned by a Regional or State Transport Authority or the Commission authorities the use of the vehicle in that place in the manner in which the vehicle is being used.
The expression 'permit ' is defined under section 2(20) of the as a document issued by the Commission or a State or Regional Transport Authority authorizing the use of a transport vehicle as a contract carriage, or stage carriage, or authorizing the owner as a private carrier or public carrier to use such vehicle.
Section 2(29) of the defines the expression 'stage carriage ' as a motor vehicle carrying or adapted to carry more than six persons excluding the driver which carries passengers for hire or reward at separate fares paid by or for individual passengers, either for the whole journey or for stages of the journey.
Section 2(j) of the Act provides that the words and expressions used but not defined in the Act, shall have the meanings assigned to them in the .
Section 48(3)(vi) of the provides that the Regional Transport Authority, if it decides to grant a stage carriage permit, may grant the permit specifying the maximum number of passengers that may be carried in the motor vehicle in respect of which the stage carriage permit is issued.
Section 60 of the empowers the Regional Transport Authority to cancel or suspend a permit for such period as it thinks fit on the breach of any of the conditions attached to the permit.
Thus a person who has obtained a stage carriage permit exposes himself to the cancellation of the permit itself under section 60 of the Act if he carries passengers in excess of the 17 maximum number of passengers that he is permitted to carry under the permit.
Under clause (2) of item 4 of Part A of the Schedule to the Act the owner of a vehicle used as a stage carriage the total mileage of which exceeded 100 kilometers per day had to pay for every quarter during the relevant time Rs.160 for every seated passenger (other than the driver and the conductor) and Rs.45 for every passenger (other than the seated passenger, the driver and the conductor) which the vehicle was permitted to carry.
According to the above provision if the owner of a motor vehicle, which is used as a stage carriage, who is permitted to carry, say, 45 person including the driver and the conductor of whom 40 are seated passengers and 3 are standing passengers, he has to pay Rs.6,535 for every quarter.
The question is whether he is liable to pay and additional tax under section 8 of the Act if he carries on any occasion any passengers in excess of the number of passengers he is permitted to carry Let us assume that the registered owner of the motor vehicle in the above case has carried on one occasion in a given quarter 47 passengers (inclusive of the driver and the conductor) and on another occasion in the same quarter 50 passengers (inclusive of the driver and the conductor).
In this illustration the question which arises for consideration is whether the registered owner is liable to pay Rs.6,535 for that quarter or Rs.6,535 plus the additional tax in respect of two more passengers or Rs.6,535 plus the additional tax for five more passengers during that quarter.
Section 8 of the Act PROVIDES that when any motor vehicle in respect of which a tax has been paid is altered or proposed to be used in such a manner as to cause vehicle to become a vehicle in respect of which a higher rate of tax is payable, the registered owner or person who is in possession or control of such vehicle shall pay an additional tax of a sum which is equal to the difference between the tax already paid and the tax which is payable in respect of such vehicle for the period for which the higher rate of tax is payable in consequence of its being altered or so proposed to be used and the taxation authority shall not grant a fresh taxation card in respect of such vehicle so altered or proposed to be used until such amount of tax has been paid.
The crucial words in section 8 of the Act are 'when any motor vehicle . . is altered or proposed to be used in such a manner as to cause the vehicle to become a vehicle in respect of which a higher rate of tax is payable '.
The payment of additional tax arises, therefore, only on two occasions; (i) when the motor vehicle is altered in such a manner as to cause the vehicle to become a vehicle in respect of which a higher rate of tax is payable; or (2) when any motor vehi 18 cle is proposed to be used in such a manner as to cause the vehicle to become a vehicle in respect of which a higher rate of tax is payable.
Admittedly, the vehicle in question has not been altered The question which remains to be considered is whether in the given case the vehicle is proposed to be used in such a manner as to cause the vehicle to become a vehicle in respect of which a higher rate of tax is payable.
The vehicle in question has been used only as a stage carriage even when two or five extra passengers have been carried.
There is no other provision in Part A of the Schedule to the Act which requires a higher rate of tax to be paid in respect of a vehicle which is being used as a stage carriage on the basis of a larger number of passengers that are carried in it.
In order to bring the case within the scope of section 8 of the Act it must be first shown that there is a provision in the Act which makes a stage carriage vehicle which carries a larger number of passengers than what is permitted under the permit issued in respect of it is subject to a higher rate of tax.
The highest rate of tax in respect of a stage carriage that can be levied under the Act is incorporated in clause (2) of item 4.
Sub clause (a) of clause (2) of item 4 of the Schedule to the Act provides that for every seated passengers (other than the driver and the conductor) which the vehicle is permitted to carry the registered owner is liable to pay Rs.160 and for every passenger (other than the seated passenger, the driver and the conductor) which the vehicle is permitted to carry has to pay Rs.45 per passenger per quarter.
In both the sub clauses the liability of the registered owner is governed by the number of passengers that he is permitted to carry under the permit issued in his favour under the and thus his liability is limited by the condition incorporated in the permit.
It would have been possible to levy higher tax on the appellant p only if the words 'which the vehicle is permitted to carry ' in item 4(2) of Part A to the Schedule to the Act had been omitted The Court cannot ignore those words while construing the said item since it relates to the levy of a tax.
Moreover the provision in section 8 is specific.
It says that the additional tax shall be equal to the difference between the tax already paid and the tax which is payable in respect of such vehicle for the period for which the higher rate of tax is payable is consequence of its being altered or so proposed to be used in such a manner as to cause the vehicle to become a vehicle in respect of which a higher rate of tax is payable.
There is another difficulty in applying section 8 to stray cases of overloading.
Additional tax is payable for the period during which the 19 vehicle is proposed to be used for a purpose which will attract a higher rate of tax.
The rate of tax is fixed taking one quarter i.e. 3 months as a unit of time for taxation.
Is it reasonably possible to determine the higher rate of tax payable, if say, on two days in a quarter there has been overloading of the vehicle for a few hours or minutes? The problem of computation of additional tax becomes difficult in such cases There is another important circumstance which persuades us to disagree with the construction placed by the High Court on the relevant provision of taxation in the Act.
The rate of taxation in this case is not based on the number of passengers actually carried during any period in a motor vehicle used as a stage carriage but it is related to the number of passengers which the motor vehicle is permitted to carry under the permit.
If the number of the passengers carried during any period is less than what is permitted, the registered owner of the motor vehicle does not get any rebate He has to pay the tax at the rate determined by the number of maximum passengers mentioned in the permit even when the stage carriage is run without any passengers.
When that is the position there appears to be no justification to hold that the registered owner or whoever is liable to pay the tax should be made to pay the additional tax merely because on some stray occasions the motor vehicle is found to have carried a few more passengers than the number permitted under the permit since the tax is not levied on the basis of the number of passengers actually carried.
The decision in Payne vs Allock, (supra) is clearly distinguishable from the present case.
In that case the appellant had paid the duty under para 6 of the Schedule II to the Finance Act, 1922 which was a residuary clause under which he had to pay 16 for taking out the licence for using his motor vehicle as a private motor car.
But he was found to be using the vehicle for the purpose of carrying goods for a fairly long period which brought the vehicle under the 5th para of that schedule which levied a higher rate of tax.
In the case before us, as we have already pointed out the vehicle could not be subjected to a higher rate of tax under any other item in Part A to the Schedule to the Act The argument urged on behalf of the State Government that the liability of the registered owner to pay tax in respect of a stage carriage depends upon the number of passengers carried in a vehicle on a given date does not appeal to us because in that event the words 20 which the vehicle is permitted to carry in item 4(2) become meaningless and ineffective.
The High Court in Noorullha Khan 's case (supra) overlooked the presence of the words 'which the vehicle is permitted to carry ' which are found in clause (b) of item 7 of the Act also.
It is no doubt true that it is not in the public interest that a registered owner of a motor vehicle should be allowed to carry more passengers than the maximum number of passengers that he is allowed to carry under his permit and such a tendency on the part of any registered owner should be checked That fact, however, cannot be relied upon for the purpose of construing the items in Part A of the Schedule to the Act liberally and in favour of the State Government.
It is needless to say that a law which imposes a tax should be construed strictly.
If the action on the part of the registered owner is contrary to the provisions of the there is sufficient provision in that Act to take appropriate action against him and either to cancel the permit or to suspend it.
In the instant case we feel that when a registered owner of a motor vehicle which is permitted to be used as a stage carriage cannot be asked to pay additional tax under section 8 of the Act merely because he has carried on some occasions more passengers than the maximum number of passengers that he is permitted to carry under the permit.
The tax which he is liable to pay is limited by the maximum number of passengers he is entitled to carry under the permit.
We, therefore, do not agree with the decision of the High Court in Noorullha Khan 's case (supra).
We overrule it The judgment of the High Court against which this appeal is filed is liable to be set aside.
It is accordingly set aside.
The respondents are directed not to levy additional tax on the appellant under section 8 of the Act for carrying more passengers than what he was permitted to carry on some occasions during the period in question.
But we however impress upon the authorities the need to enforce the provision in section 60 of the strictly.
The appeal is accordingly allowed.
No costs S.L. Appeal allowed.

summary:
% The appellant was a registered owner of a motor vehicle run by him as a stage carriage under a permit issued under the .
He was liable to pay tax in respect of the vehicle under section 3 of the Karnataka Motor Vehicles Taxation Act, 1957, which provides that a tax at the rates specified in Part A of the Schedule to the Act shall be levied on all motor vehicles suitable for use on roads, and item 4 in Part A of the Schedule to the Act, as it stood in 1985, relates to the levy of tax on the motor vehicles used as stage carriages.
On some occasions, it was found that the appellants stage carriage was carrying passengers in excess of the number of passengers allowed to be carried under the permit issued to him under the .
The taxation authority under the Karnataka Act above said issued to him a demand for the payment of additional tax under section 8 of the said Act.
The appellant filed a writ petition, challenging the demand for the additional tax.
The High Court dismissed the petition, following its earlier decision in Noorullha Khan vs State of Karnataka (Writ Petition No. 8302 of 1980, etc.
decided on 26.6.85.) The appellant appealed to this Court by special leave against the order of the High Court.
Allowing the appeal, the Court, ^ HELD: The taxation authority levied the additional tax under section 8 of the Karnataka Motor Vehicles Taxation Act, 1957, on the ground that the appellant had proposed to use the vehicle in such a manner as to cause the vehicle to become a vehicle in respect of which a higher rate of tax was payable, in accordance with the decision of the High Court in the Noorullha Khan 's case.
The payment of the additional tax arises as per section 8 on two occasions (i) when the Motor 11 Vehicle is altered in such a manner as to cause the vehicle to become a vehicle in respect of which a higher rate of tax is payable, or (ii) when any motor vehicle is proposed to be used in such a manner as to cause the vehicle to become a vehicle in respect of which a higher rate of tax is payable.
The vehicle in question has not been altered, and it has been used only as a stage carriage, even when two or five extra persons have been carried.
There is no other provision in Part A of the Schedule to the Act which requires a higher rate of tax to be paid in respect of a vehicle which is being used as a stage carriage on the basis of a larger number of passengers that are carried in it.
It would have been possible to levy a higher tax on the appellant only if the words 'which the vehicle is permitted to carry ' in item 4(2) of Part A to the Schedule to the Act had been omitted.
These words cannot be ignored in the construction of the said item since it relates to the levy of tax.
Also, the provision in section 8 is specific.
[17G H; 18A C, F G] The High Court in Noorullha Khan 's case overlooked the presence of the words 'which the vehicle is permitted to carry ', found also in clause (b) of item 7 of the Karnataka Act.
A law which imposes a tax should be construed strictly.
A registered owner of a motor vehicle, which is permitted to be used as a stage carriage cannot be asked to pay additional tax under section 8 of the Act merely because he has carried on some occasions more passengers than the maximum number of passengers that he is permitted to carry under the permit.
The tax which he is liable to pay is limited by the maximum number of passengers he is entitled to carry under the permit.
The Court does not agree with the decisions of the High Court in the Noorullha Khan 's case, which is overruled.
The judgment of the High Court impugned set aside and the respondents directed not to levy the additional tax on the appellant under section 8 of the Karnataka Taxation Act for carrying more passengers than what he was permitted to carry on some occassions during the period in question.
Need impressed upon the authorities to enforce the provision in section 60 of the , strictly.[20A, D F] Payne vs Allock, , referred to.