judgement:
ivil Appeal Nos.
1168 69 (NT) of 1973.
Appeal by Special leave from the Judgment and Order dated 103 the 3rd January, 1973 of the Allahabad High Court in I. T. Ref.
No. 450 of 1969.
S.C. Manchanda and M. J.P. Malhotra for the Appellant.
S.T. Desai, B.B. Ahuja and Miss A. Subhashini for the Respondent.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
These appeals by certificate granted by the High Court of Allahabad under Section 66A(2) of the Indian Income Tax Act, 1922, arise out of judgment delivered and order passed on 3rd January, 1973 by the High Court of Allahabad in Income tax Reference No. 450 of 1965.
The following question of law had been referred to the High Court for consideration under Section 66(1) of the Income Tax Act, 1922 by the Appellate Tribunal, Allahabad Bench, Allahabad: "Whether, on the facts and in the circumstances of the case, valid assessments could be made on 31st May, 1962, for the assessment years 1948 49 and 1949 50 on the basis of voluntary returns of income filed under Section 22(1) of the Indian Income Tax Act, 1922 on 18.11.1950? The matter came up before a Division Bench of the High Court and as there was a previous bench decision of that Court in the case of Sool Chand Ram Sewak vs Commissioner of Income tax, U.P. which supported the revenue 's case and as the division bench before whom this case came was unable to accept that view, the division bench referred the case to a larger Bench.
This reference thereafter came before a Full Bench consisting of Gulati, H. N. Seth & C.S.P. Singh, JJ.
Gulati and C. section P. Singh, JJ. answered the question in the affirmative in favour of the revenue and against the assessee.
Seth J. however, was in favour of assessee.
In view of the majority the question was answered in favour of the revenue and in affirmative.
104 Before we deal with the question in controversy, it will be necessary to note some of the relevant facts.
There were originally four appeals for the assessment years 1946 47, 1947 48, 1948 49 and 1949 50.
As the appeals for the assessment years 1946 47 and 1947 48 were withdrawn by the revenue, we are now concerned with appeals for the assessment years 1948 49 and 1949 50.
The present assessee is a branch of a bigger Hindu undivided family known as Nathu Ram Jawahar Lal, Jhansi.
The bigger Hindu undivided family of M/s Nathu Ram Jawahar Lal was partitioned on 19th May, 1945, and the present assessee along with another smaller H.U.F. came into existence and the said bigger H.U.F. had made a claim in respect of the partition under Section 25A of the Indian Income Tax Act, 1922.
While this claim was pending the present assessee filed voluntary returns under Section 22(1) of the Act for the assessment years 1946 47 to 1949 50 on 10th November, 1950.
The said claim of partition by the bigger H.U.F. was rejected by the Income tax Officer and also by the Appellate Assistant Commissioner.
The said H.U.F. thereafter, filed appeals to the Appellate Tribunal in respect of the order under claim of partition under Section 25A of 1922 Act which by its order dated 31st August, 1954 accepted the claim under Section 25A of 1922 Act, and the Tribunal passed orders on that basis in the appeals relating to the assessment orders in respect of the bigger H.U.F. on 28th October, 1954.
The Income tax Officer, thereafter, initiated proceedings under Section 34 of the Income tax Act of 1922 for assessing the smaller Hindu undivided family, the present assessee in view of the fact that the claim for disruption of the bigger H. U. F. had been accepted by the Tribunal.
The present assessee filed fresh returns of income on 12.4.1955 in response to notices under Section 34 of 1922 Act.
The returns originally filed were under Section 22(1) and were filed on 18th November, 1950.
The assessee 's objection regarding the validity of the assessments being made under Section 34 on merits as well as on the point that time for making the assessment under Section 34 had already expired, were rejected by the Income tax Officer.
He, therefore, completed the assessments on 8.9.1955 under Section 23(3) read with Section 34 of the Income tax Act, 1922.
The assessee could not get any decision in his favour either from the Appellate Assistant Commissioner or from the Tribunal and being aggrieved by these orders, filed a Writ Petition to the High Court of Allahabad challenging the validity of the Appellate 105 orders.
The assessee was successful in the Writ and, therefore, the appellate orders were quashed by the High Court.
The revenue having failed in its attempt to complete the assessee 's assessments under Section 34, made another attempt to assess the assessee on the basis of the voluntary returns originally filed by the assessee on 18.11.1950 by relying upon the order of the Tribunal dated 28.10.1954 and invoking the provisions of 2nd proviso to Section 34(3).
The said assessments which were completed on 31st May, 1962 were the subject matters of appeals before the Tribunal.
The point before the Tribunal was whether valid assessments could be made for the assessment years under consideration on 31st May, 1962 on the basis of the returns filed under Section 22(1) of the Act of 1922 on 18th November, 1950.
The Appellate Assistant Commissioner by his order held that no valid assessments could be made on 31st May, 1962.
It appears that on 28th October, 1950, relating to the assessment years 1946 47 to 1949 50 in case of bigger Hindu undivided family, M/s Nathu Ram Jawaharlal, Jhansi, order was passed by the Tribunal in the appeal relating to the assessments pending before it.
It should be noted that originally on the basis that the bigger H.U.F. had not been disrupted assessments for these years had been made and appeals relating to those assessments were pending before the Tribunal.
The Tribunal disposed of these appeals by the order dated 28th October, 1954 and the Tribunal in the said order had observed, inter alia, as follows; "The assessments for those years were (have) necessarily to be set aside with the direction that fresh assessments should be made, one for the period 19.5.1945 upto which the Hindu undivided family was in existence and the others on the component Hindu undivided families, namely M/s Jawaharlal Mani Ram and Bhagwan Das Sita Ram.
" The Tribunal in the instant appeal out of which the reference was made to the High Court and out of which these appeals arise, after discussing the relevant facts and the provisions of law confirmed the order of the Appellate Assistant Commissioner and dismissed the appeals.
As mentioned hereinbefore after the Tribunal had directed the assessments should be made on the component units of the bigger Hindu undivided family, after partition was accepted, namely, the assessee and Jawaharlal Mani Ram, the Income tax Officer instead 106 of proceeding on the basis of the voluntary returns already filed by the assessee proceeded to take action under Section 34(1) (b) of the Act of 1922 and completed the assessments for all the four years on September 8,1955.
The assessee appealed against these assessments to the Appellate Assistant Commissioner of Income tax, but before the appeals were taken up for hearing, the assessee moved the High Court of Allahabad under Article 226 of the Constitution.
On March 30, 1960, the High Court quashed the assessment orders on the ground that as voluntary returns filed by the assessee were pending, no proceeding could be taken under Section 34 of the Act, 1922.
Thereafter the Income tax Officer initiated proceedings on the basis of the voluntary returns.
The assessee again filed a writ petition praying for quashing the proceedings on the ground that revenue could not proceed against it on the basis of the voluntary returns.
This petition was rejected by the High Court and thereafter the Income tax Officer proceeded to complete the assessments under Section 23(3) and passed assessment orders on 31st May, 1962, in respect of the four years.
The first question, is, whether the assessment could be made under Section 23(3) on the basis of voluntary returns filed or action should have been taken under Section 34 with the help of the second proviso to sub section (3) of Section 34.
It is well settled that when a return of income is filed by the assessee voluntarily under Section 22(1) of the Act, 1922, assessment proceedings commence against him and Section 34 does not come into play at all so long as the assessment proceedings remain pending.
But it was contended that a return exhausted itself after the expiry of four years from the end of the assessment year to which it related.
After the expiry of that period, no assessment was possible on the basis of the voluntary return.
In such a case assessment was possible under Section 34, if the case was covered by the second proviso to Section 34(3).
The High Court was of the opinion that sub section (3) of Section 34 provides a period of limitation of four years for assessment under Section 23 of the Act, 1922.
If the assessment proceedings commence by filing of voluntary return, as indeed these do, on the expiry of the period of four years from the end of the year in which the income, profits or gains were first assessable, such proceedings are suspended or interrupted.
But neither the proceedings nor the returns become invalid.
The High Court referred to the provisions of Section 34(3) and was of the view that since the order was passed by the Tribunal giving direction, the bar or limitation was lifted and 107 the assessments could be made without any bar or limitation.
Reference was made to the decision of this Court in the case of Commissioner of Income tax Bombay City II vs Ranchhoddass Karsondas, and in the case of Estate of the late A.M.K.M.
Karuppan Chettiar vs Commissioner of Income tax, Madras and Commissioner of Income tax Madras vs M.K.K.R. Muthukaruppan Chettiar.
The High Court, on the basis of these decisions, was of the view that assessments could be made on the basis of voluntary returns already filed by the assessee.
We are of the opinion that the High Court was right.
The next question is whether it was open to the Tribunal to give a finding or direction in respect of the present assessee.
Reliance was placed on the decision of this Court in Income tax Officer, A Ward, Sitapur vs Murlidhar Bhagwan Das.
There, this court after referring to the expression "any person" in the 2nd proviso of sub section (3) of Section 34 of 1922 Act observed at page 346 of the report as follows.
"The expression "any person" in its widest connotation may take in any person, whether connected or not with the assessee, whose income for any year has escaped assessment; but this construction cannot be accepted, for the said expression is necessarily circumscribed by the scope of the subject matter of the appeal or revision, as the case may be.
That is to say, that person must be one who would be liable to be assessed for the whole or a part of the income that went into the assessment of the year under appeal or revision.
If so construed, we must turn to section 31 to ascertain who is that person other than the appealing assessee who can be liable to be assessed for the income of the said assessment year.
A combined reading of section 30(1) and Section 31(3) of the Act indicates the cases where persons other than the appealing assessees might be affected by orders passed by the Appellate Commissioner.
Modification or setting aside of assessment made on a firm, joint Hindu family, association 108 of persons, for a particular year may affect the assessment for the said year on a partner or partners of the firm, member or members of the Hindu undivided family or the individual, as the case may be.
In such cases though the latter are not co nomine parties to the appeal, their assessments depend upon the assessments on the former.
The said instances are only illustrative.
It is not necessary to pursue the matter further.
We would, therefore, hold that the expression "any person" in the setting in which it appears must be confined to a person intimately connected in the aforesaid sense with the assessments of the year under appeal.
" The High Court was of the view that "any person" would include the person who would be liable to be assessed for the whole or a part of the income that went into the assessment of the year under appeal or revision.
In that view of the matter, the majority judgment of the High Court on this aspect was in favour of the revenue.
Then on the question whether the direction for the assessment could be given in respect of any other year, other than the year in which the partition took place, it was contended that direction could be given only for the assessment year 1946 47.
Majority judgment of the High Court found no force in that contention.
As this question arose directly for the assessment years 1948 49 and 1949 50 in respect of which the appeals came before the Tribunal in which the directions had been given, the High Court was of the view that it was necessary for the Tribunal to give a finding with regard to the partition of the family and the ownership of the income in both the appeals.
The Tribunal was thus competent to give the direction.
In that view of the matter, the two learned judges of the Allahabad High Court were of the opinion that assessments were valid and answered the question in favour of the revenue.
Referring to the said decision which has been mentioned in the majority judgment, Seth J. however was of the view that the direction given by the Tribunal in this case did not authorise the assessment on the smaller Hindu undivided family.
Seth J. was further of the view that such direction could only have been given in the year in which disruption of the bigger H.U.F. took place.
In that view of the matter, Seth J. expressed dissent as mentioned hereinbefore.
We are of the opinion that the majority of the learned judges of the High Court were right.
Second proviso to Section 34(3) of the Indian Income tax Act, 1922 authorised directions to be given by the Tribunal in respect of the assessee or any person beyond four years as provided in Section 34(3) of 1922 Act.
109 As noted before the expression "any person" in respect of whom such direction could be given was explained by this Court in Income tax Officer, A Ward Sitapur vs Murlidhar Bhagwandas (supra).
As mentioned in the passage quoted above from the said decision, if so construed then the Court must turn to Section 31 of 1922 Act to a certain who is that person other than the appealing assessees might be affected by the orders passed by the appellate authority.
Modification or setting aside of assessment made on a firm, joint Hindu family, association of persons, for a particular year may affect the assessment for the said year on a partner or partners of the firm, member or members of such Hindu undivided family or the individual, as the case might be.
It was therefore argued that it was only those types of assessees mentioned by this Court in the passage noted above were the 'persons ' who could be "any person" other than the appealing assessee who can be said to be liable to be assessed and in respect of whom direction might be given, otherwise such directions or provision for such directions if the provision is so read would be ultra vires article 14 of the Constitution.
We must make it clear that this Court had itself made it clear categorically in the passage quoted above that the instances given in the above passage were only illustrative passage meaning thereby that the instances were not exhaustive.
This Court made it clear that the expression "any person" in its widest amplitude might take in any person connected or not with the assessee, whose income for any year had escaped assessment; but this construction could not be accepted, for the said expression was necessarily circumscribed by the scope of the subject matter of the appeal or revision, as the case might be.
So therefore the person must be one who would be liable to be assessed for the whole or any part of the income that went into assessment of the year under appeal or revision (Emphasis supplied).
Therefore, this Court observed that "any person" in sub section (3) of Section 34 must be confined to a person intimately connected in the aforesaid sense with the assessments of the years under appeal.
Reference may be made to the decision of this Court in the case of Rajinder Nath vs Commissioner of Income tax, Delhi, where the I.T.O. treated two buildings as belonging to a firm comprised of a father and his two major sons as partners and in the assessments on the firm for the assessment years 1955 56 and 1956 57 and he estimated the cost of construction of the buildings at a higher figure than that 110 disclosed and brought to tax the excess as income in the hands of the firm.
On appeal, the A.A.C. found that the money advanced for the construction of the buildings had been debited in equal shares to the father and two major sons and a minor son and held that the firm was not the owner of the properties and delected the addition.
The A.A.C. also observed that the I.T.O. was free to take action to assess the excess in the hands of the co owners.
The I.T.O. thereupon issued notices under Section 147(a) of the I.T. Act, 1961 and reopened the assessments of the individual assessees (the co owners) and included therein the proportionate shares of the additions on account of the estimated excess of the cost of construction.
On appeal, the A.A.C. held that Section 147(a) could not apply but upheld the assessments under Section 153(3) (ii) of 1961 Act.
On further appeal, the Tribunal held that Section 153(3) (ii) could not apply because there was neither a finding nor a direction in the earlier order of the A.A.C. and further that A.A.C. could not convert the assessments made under Section 147(a) into those under Section 153(3) (ii).
On a reference of the questions, (i) whether the A.A.C. was justified in holding that the provisions of Section 147(a) were not applicable, and (ii) whether the provisions of Section 153 (3) (ii) were not applicable, the High Court held that the provisions of Section 153(3) were applicable observing that the A.A.C 's finding that the properties did not belong to the firm and, therefore, the excess amount of the cost of construction could not be regarded as the income of the firm was a finding which was necessary for the disposal of the firm 's appeal and as a corollary it was held that the buildings belonged to the co owners and this necessitated the "direction" to the I.T.O. that he was free to assess the excess in the hands of the co owners.
Dealing with this contention, Pathak J. who delivered the judgment of this Court observed at page 20 of the report: "The expression "another person" in the Expln.
would include persons intimately connected with the person in whose case the order is made in the sense explained by this Court in Murlidhar Bhagwan Das It is one thing for the partners of a firm to be required to explain the source of a receipt by the firm, it is quite another for them in their individual status to be asked to explain the source of amounts received by them as separate individuals.
On such opportunity being provided it would have been open to the assessees to show that the excess alleged over the disclosed cost of construction did not constitute any taxable income.
The finding contemplated in Expln.
3, it will be 111 noted, is a finding that the amount represents the income of another person.
" In the instant case before us, applying the test observed in that case this was a case where the facts showed that income can belong either to the bigger Hindu undivided family or to the smaller Hindu undivided family, the present assessee along with another smaller H.U.F. and to no one else.
Therefore a finding that it belongs or it does not belong to the bigger Hindu undivided family which had disrupted on partition would determine the issue whether it could be taxed in the hands of the present assessee.
Judged in the light of the test laid down in Murlidhar Bhagwan Das (supra) and as pointed out in Rajinder Nath 's case, it appears to us that the present assessee can be said to be a person who would be liable to be assessed for the whole or part of the income that went to the assessment of the bigger Hindu undivided family in years under appeal and is a person intimately connected with the assessments of the bigger Hindu undivided family.
The income in this case cannot be the income of both bigger Hindu undivided family and the present assessee, it must be either of these two.
We are, therefore, of the opinion that directions given in the appeals filed by the bigger Hindu undivided family would be applicable to the present assessee.
On behalf of the assessee it was contended that only the categories of persons referred to in Sections 30(1) and 30(3) of 1922 Act would be governed by the said expression "any person" Sub section (3) of Section 31, inter alia, authorises the Appellate Assistant Commissioner in case of an order cancelling registration of a firm under sub section (42) of Section 23 or refusing to register a firm under sub section (4) of Section 23 or Section 26A or to make fresh assessment or to confirm such order, or cancel it and direct the Income tax officer to register the firm or to make a fresh assessment, as the case may be, or in the case of an order under sub section (2) of Section 25 or sub section (1) of Section 23A or sub section (2) of Section 26 or Section 48, 49 or 49F, confirm cancel or vary such order.
It also authorises in case of an order under sub section (1) of Section 25A to confirm such order or cancel it and either direct the Income tax officer to make further inquiry and pass a fresh order or to make an assessment in the manner laid down in sub section (2) of section 25A.
The other cases were cases of orders under Section 28 or sub section (6) of Section 44E or sub section (5) of Section 44F or sub section (1) of Section 46, 112 or in case of an appeal against a computation of loss under Section 24, confirm or vary such computation, or in case of an appeal under sub section (1A) of Section 30 decide that the person is or is not liable to make the deduction and in the latter case direct the refund of the sum paid under sub section (6) of Section 18.
While on these provisions it is material to refer to sub section (4) of Section 33 which authorises the Tribunal after giving both parties an opportunity of being heard to pass such orders thereon as it thinks fit and to communicate any such orders to the assessee and to the Commissioner.
The contention on behalf of the assessee is that though the Appellate Tribunal has wide powers as indicated in sub section (4) of Section 33 but the amplitude of that power is curtailed by other provisions.
It was contended that read with sub section (3) of Section 34, as assessment order could not be passed after the expiry of four years from the end of the year in which the income, profits or gains were first assessable and is view of the fact that here in the instant case voluntary returns for the years under question had been filed by the assessee within time, after four years no direction could be given by the Tribunal.
It was, secondly, contended that the present smaller Hindu undivided family was not intimately connected with the assessment of the bigger Hindu undivided family as contemplated by the observations of this Court in Income tax Officer vs Murlidhar Bhagwan Das (supra), this direction was of no use and the assessment made on the basis of this direction cannot be availed of.
We are unable to accept this contention.
Firstly it must be observed that the Tribunal passed the orders and gave its direction in respect of the years concerned.
These years were the subject matters of appeal before the Tribunal in the case of bigger H.U.F. It was contended that these direction were given subsequent to the order under Section 25A and could not affect position thereafter.
We are a unable to accept this position also.
As mentioned hereinbefore, the order under Section 25A was passed in August, 1954.
The bigger Hindu undivided family had applied for order under Section 25A regarding the disruption of the Hindu undivided family, the Income tax Officer rejected that prayer.
The assessee appealed therefrom.
In August, 1954, this order was set aside by the Tribunal and it was held that the bigger Hindu undivided family had been disrupted.
In as much as the income liable to be assessed on the smaller Hindu undivided family would arise only on the disruption of the larger Hindu 113 undivided family, this direction was proper.
The order under Section 25A declares the status of the family and the smaller Hindu undivided family became liable to be assessed as a result of disruption of the bigger Hindu undivided family.
The assessment orders however were passed based on the previous order under section 25A but these orders were passed for all these four years and the assessments under appeal for all these four years were pending before the Tribunal in disposing of which the Tribunal gave the direction to make the assessments on the smaller Hindu undivided family.
Therefore no question arises as to whether for subsequent periods directions could have been given.
This is a direction clearly within the contemplation of sub section (3) of Section 34.
Secondly, we are of the opinion that the smaller Hindu undivided family is one of the persons which was clearly contemplated by sub section (3) of Section 34 in the facts and circumstances of this case.
The assessability of income and the quantum of the same of the present assessee was linked up with the assessability of the bigger Hindu undivided family if the bigger Hindu undivided family was liable to be assessed if there was no disruption then there was no income of the smaller Hindu undivided family.
The income in the hands of smaller Hindu undivided family could then not have been liable to be assessed.
I on the other hand it was the other way that there was a valid partition, the bigger Hindu undivided family no longer existed and the smaller Hindu undivided family would be liable to be assessed.
From that point of view it clearly comes within the ratio of the observation of this Court in Income tax officer vs Murlidhar Bhagwan Das (supra).
Further more looked at from another point of view, though the Karta represented the bigger Hindu undivided family, all the members of the bigger Hindu undivided family, including those who were members of the smaller Hindu undivided family were parties though not oe nomine for all practical purposes, because they were liable as members of the family for the amount assessed.
In that view of the matter, we are of the opinion that this direction was quite valid and would be applicable.
The observations of this Court in the case of Commissioner of Income tax Central, Calcutta vs National Taj Traders are in consonance with the conclusions reached by us.
Tulzapurkar, J. explained in the said decision the situations in which directions could be given under Section 33B of the Income tax Act, 1922 where 114 there was no express provision like sub section (3) of Section 34.
In our opinion in the facts of this case, the present assessee can be said to be "any person" as indicated in Murlidhar Bhagwan Das (supra) in Section 34(3) of 1922 Act.
The view taken by us is also in consonance with the observation of this Courts in the case of Commissioner of Income tax, Andhra Pradesh vs Vadde Pullaiah & Co.1 Reference was also made to a Bench decision of the Bombay High Court in the case of Mathuradas B. Mohta vs Commissioner of Income tax, Poona, and a decision of this Court in the case of Commissioner of Income tax, U.P. vs Mohd. Shakoor Mohd. Bashir.
But in view of the facts and circumstances of the instant case before us, it is not necessary to deal with the said decisions.
On behalf of the assessee, reliance was placed on a decision of the Division Bench of Gujarat High Court in the case of Commissioner of Income tax, Gujarat vs Shantilal Punjabhai.
There an individual Shantilal was a member of the Hindu undivided family and also a partner of a firm.
The Income tax officer found that the assessee was the nominee of the Hindu undivided family in the said firm, and, therefore, included the share of profits the assessee in the said firm, in the total income of the Hindu undivided family.
The decision proceeded on the basis that the Income tax Act did not contemplate two different assessees in the same assessment year for the same taxable income.
In that case the assessee was also an assessee in his own right.
In that case the Court had observed at page 80 of the report that there were two separate and distinct assessment proceedings, one in respect of the assessee in his status as an individual and the other in respect of the Hindu undivided family.
The assessment proceedings in respect of the assessee, Shantilal, were in respect of his income arising from his self acquired and separate property.
The assessment proceedings against the Hindu undivided family, were proceedings against the entire entity, and though the assessee, Shantilal, was a member of the family, the assessment was on the income derived by the Hindu undivided family from the property or business of the said Hindu undivided family.
In that 115 assessment, the income accruing and arising from the separate property of the assessee, Shantilal could not be assessed, as the business carried on by the asseseee, Shantilal, was not the business of the Hindu undivided family.
The Income tax Officer held that Shantilal was the nominee of the Hindu undivided family, meaning thereby that the business belonged to the Hindu undivided family and it was that conclusion of the Income tax officer which was reversed by the Tribunal.
The Tribunal holding that the revenue had failed to prove that the assessee, Shantilal was the nominee of the family, in other words, that the income arising from the firm 's business was the income of the Hindu undivided family.
The direction given by the Tribunal was on the question which was between the revenue and the Hindu undivided family and the only finding that could be given by the Tribunal was between the two parties, namely, the Hindu undivided family and the revenue and not between the revenue and the assessee.
Shantilal, who was not an assessee nor a party to those assessment proceedings.
Therefore, if any action had to be taken in consequence of the finding or the direction given by the Tribunal, that action could be taken not against the assessee, Shantilal, but against the Hindu undivided family.
As would be apparent, the facts of that case were entirely different.
Here in the instant case the proceeding against the assessee in the present case could be taken only if there was disruption of the Hindu undivided family.
Therefore in the assessment of Hindu undivided family.
viz. if the bigger Hindu undivided family was considered to be an existing entity then in such a case the assessment against the present assessee could not be sustained.
If on the other hand the assessment on the bigger H.U.F. could not be sustained because there was disruption of the family as contended for by the bigger Hinud undivided family then only the present assessee could be assessed.
In that view of the matter, we are of opinion that the present assessee can be said to be.
a person other then the appealing assessee would be affected by the order concerned and would come within the meaning of "any person" as explained by this Court in the case of Income tax officer vs Murlidar Bhagwan Das (supra).
Decision of this Court in the case of Commissioner of Income tax, Punjab, Jammu & Kashmir and Himachal Pradesh vs section Raghubir Singh Trust was relied on behalf of the assessee.
There the res 116 pondent trust created by R. filed its return of income for the assessment year 1954 55.
Holding that the trust was invalid, the Income tax officer assessed the income of the trust in the hands of R.R. carried the matter in appeal and other proceedings and ultimately the High Court held that the trust was valid and the income was the income of the trust and not of R.
The I.T.O. issued a notice on 19th September, 1961, under Section 34(1)(b) of the Indian I.T. Act, 1922, to reopen the assessment of the trust.
The trust claimed that the notice was barred by limitation.
The Tribunal accepted the claim and held that trust was a stranger to the proceedings for the assessment of R and the second proviso to Section 34(3) did not save the reassessment proceedings initiated against the trust from the bar of limitation and the High Court, on a reference, agreed with the Tribunal.
On appeal to this Court it was held, affirming the decision of the High Court, that even though the finding of the High Court that the income belonged to the trust and not to R was a finding necessary for disposing of the reference in favour of R and it was a "finding", but the trust was a stranger to the assessment proceedings of R. and not "any person" within the meaning of the second proviso to Section 34(3) and, therefore, the second proviso to Section 34(3) was not attracted and the reassessment proceedings against the trust were barred by time.
That decision must be understood in the facts of that case.
The settler and the trust cannot be said so intimately connected as to come within the ratio of Murlidhar Bhagwan Das 's case.
The Court found that assessee trust could not be said to be intimately connected with the assessment of Raghubir Singh.
As a result of the trust deed failing, there may be numerous situations viz., there might be resulting trust or it might be that the trust property would go to other beneficiaries.
It is not necessary for us to explore or explain those possibilities.
But in the facts of this case, we are of the opinion that whether the income of the smaller Hindu undivided family, namely the present assessee is liable to be taxed is so intimately or inextricably linked up with the question of assessability of bigger Hindu undivided family, which again is dependent upon the question whether there was disruption of bigger Hindu undivided family and that being the very subject matter of appeals in the four years in which this direction had been given, we are of the opinion that directions given in this case are valid and would save the assessments against the assessee for the two years in question.
In the aforesaid view of the matter, we are of the opinion that 117 the majority of the learned judges of the High Court were right in their conclusions and the question was correctly answered by the majority of the learned judges of the High Court.
The appeals therefore fail and are dismissed with costs.
H.S.K. Appeals dismissed.

summary:
A bigger Hindu undivided family (HUF) had filed income tax returns for the assessment years 1946 47 to 1949 50.
When the assessment was being done the bigger (HUF) made a claim under section 25A of the Income Tax Act, 1922, that the said HUF was partitioned on 19.5.1945.
While this claim was pending, the appellant along with a smaller HUF (hereinafter referred to as the assessee) which had come into being on partition of the bigger HUF, filed voluntary returns on 18.11.1950 for the assessment years 1946 47 to 1949 50 under s.22(1) of the Act.
The bigger HUF 's claim partition, which was rejected by the Income Tax Officer and the Appellate Assistant Commissioner, was accepted by the Appellate Tribunal on 31.8.1954.
While disposing of the appeals of the bigger HUF against the assessment orders, the Tribunal gave a direction on 28.10.1954 that assessments be made on the bigger HUF after accepting partition.
After the claim of partition was accepted the Income tax Officer sent notices to the assessee for initiating proceedings against him under s.34(1) (b).
In response to the notices the assessee filed fresh returns on 12.4.1955.
Rejecting the contention of the assessee that the time for making assessment under s.34 had expired, the Income tax Officer completed assessments under section 23(3) read with section 34 on .
8.9.1955.
The assessee 's appeal was rejected by the Appellate Assistant Commissioner and the Appellate Tribunal.
The assessee filed a writ petition in the High Court which was allowed and the assessment orders were quashed on 30.3.1960.
The High Court observed that as voluntary returns filed by the assessee were pending no proceeding could be taken under section 34.
Thereafter the Revenue attempted to assess the assessee on the basis of voluntary returns originally filed on 18.11.1950 by relying upon the order of the Tribunal dated 23.10.1954 in the bigger HUF 's case and invoking second proviso to section 34(3).
The assessee filed a writ petition and that was dismissed.
The Income tax Officer completed assessment under section 23(3) on 31.5.1962.
In appeal the Appellate Assistant Commis 101 sioner held that no valid assessment could be made on 31.5.1962 and this view was confirmed by the Appellate Tribunal.
A reference was made to the High Court on the question whether on the facts and circumstances of the case, valid assessment could be made on 31.5.1962 for the assessment years 1948 49 and 1949 50 on the basis of voluntary returns of income filed under section 22(1) of the Act.
The assessee contended that since a return exhausted itself after expiry of four years from the end of the assessment year to which it related, no assessment could be made on the basis of voluntary return, it could be done under section 34 only if 2nd proviso to sub section
(3) of section 34 applied.
By majority a full Bench of the High Court answered the question in the affirmative in favour of the revenue.
Hence these appeals.
The two questions which arose were: (1) whether the assessment could be made under section 23(3) on the basis of voluntary returns filed or action should have been taken under section 34 with the help of the second proviso to sub section
(3) of section 34; and (2) whether the Tribunal could give a finding or direction in respect of the assessee.
Dismissing the appeals, ^ HELD : On Question No. (1) The High Court was right in taking the view that assessments could be made on the basis of voluntary returns already filed by the assessee.
Sub section
(3) of section 34 provides a period of limitation of four years for assessment under section 23 of the Act.
If the assessment proceedings commence by filing of voluntary returns, as indeed these do, on the expiry of the period of four years from the end of the year in which the income, profits or gains were first assessable, such proceedings are suspended or interrupted.
But neither the proceedings nor the returns become invalid.
Since the order was passed by the Tribunal giving direction, the bar of limitation provided by section 34(3) was lifted and the assessments could be made without any bar of limitation.
[106 G H, 107 A] Commissioner of Income tax Bombay City II vs Ranchhoddass Karsondas, ; Estate of the late A.M.K.M.
Karuppan Chettiar vs Commissioner of Income tax, Madras, ; and Commissioner of Income tax Madras vs M.K.K.R. Muthukaruppan Chettiar, , referred to On question No. (2) The High Court rightly answered the question in favour of the revenue on the view that the Tribunal was competent to give the direction in respect of the present assessee.
[108 E G] Second proviso to section 34(3) authorises directions to be given by the Tribunal in respect of the assessee or any person beyond four years as provided in section 34(3) of the Act.
As explained in Income tax Officer vs Murlidhar Bhagwandas, "any person" in respect of whom such direction could be given must be one who would be liable to be assessed for the whole or a part of the income that went into the assessment of the year under appeal or revision.
The court must turn 102 to section 31 of the Act to ascertain who is that person other than the appealing assessee who might be affected by the orders passed by the appellate authority.
Modification or setting aside of assessment made on a firm, joint Hindu family, association of persons for a particular year may affect the assessment for the said year on a partner or partners of the firm, member of members of such Hindu undivided family or the individual, as the case might be.
These instances are only illustrative and not exhaustive.
The expression "any person" in its widest amplitude might take in any person connected or not with the assessee, whose income for any year had escaped assessment; but this construction cannot be accepted, for the said expression was necessarily circumscribed by the scope of the subject matter of the appeal or revision, as the case might be.
So therefore the person must be one who would be liable to be assessed for the whole or any part of the income that went into assessment of the year under appeal or revision (Emphasis supplied).
Therefore, "any person" in sub section (3) of section 34 must be confined to person intimately connected in the aforesaid sense with the assessments of the years under appeal.
[701 C S, 108 A F] Income tax Officer, A Ward, Sitapur vs Murlidhar Bhagwan Das, ; Rajinder Nath vs Commissioner of Income tax, Delhi, ; Commissioner of Income tax, Central, Calcutta vs National Taj Traders, 121 I.T.R. 535; and Commissioner of Income tax, Andhra Pradesh vs Vadde Pullaiah & Co., , referred to.
The facts in the instant case show that income can belong either to the bigger Hindu undivided family or to the smaller Hindu undivided family, the present assessee alongwith another smaller H.U.F. and to no one else.
Therefore a finding that it belongs or it does not belong to the bigger Hindu undivided family which had disrupted on partition would determine the issue whether it could be taxed in the hands of the present assessee.
Judged in the light of the test laid down in Murlidhar Bhagwan Das case and as pointed out in Rajinder Nath 's case, it appears that the present assessee can be said to be a person who would be liable to be assessed for the whole or part of the income that went to the assessment of the bigger Hindu undivided family in years under appeal and is a person intimately connected with the assessments of the bigger Hindu undivided family.
The income in this case cannot be the income of both bigger Hindu undivided family and the present assessee, it must be either of these two.
Therefore, the directions given in the appeals filed by the bigger Hindu undivided family would be applicable to the present assessee.
[111 A D] Commissioner of Income tax, Gujarat vs Shantilal Punjabhai, , distinguished.
Commissioner of Income tax, Punjab, Jammu & Kashmir and Himachal Pradesh vs section Raghubir Singh Trust, referred to.


judgement:
Civil Appeal No. 3839 of 1982.
From the Judgment and order dated the 12th October, 1982 of the Kerala High Court in Election Petition No. 1 of 1982.
K.K. Venugopal, G. Vishwanatha Iyer and E.M.S. Anam for the Appellant.
76 Ram Jethamalani, M.M. Abdul Khader, Dileep Pillai and M.A. Firoz for Respondent No. 1.
K.G. Bhagat, Addls, Sol.
General and Miss A. Subhashini for Union.
S.S. Ray, A.K Sen and Miss A. Subhashini for the Election Commissioner.
Ram Jethamalani and Miss Rani Jethmalani for the Intervener.
The Judgment of the Court was delivered by FAZAL ALI, J.
This election appeal has been filed by the appellant, who was a candidate for election to "No. 70 Parur Assembly Constituency" in Kerala but was not elected.
Six candidates contested the said election which was held on May 19, 1982, out of whom the first respondent (Sivan Pillai), who was a candidate of the Communist Party of India, and the appellant were the two principal contestants.
The result of the election was announced on May 20,1982 in which the first respondent was declared elected having secured 30450 votes as against 30327 votes secured by the appellant.
Thus, the first respondent secured 123 more votes than the appellant.
Of the 30450 votes, 11268 were cast manually, according to the conventional method provided in the Conduct of Election Rules, 1961 (for short, to be referred to as the 'Rules ') made under the Representation of the People Act, 1951 (hereinafter to be referred to as the 'Act '), and 19182 votes were cast by means of electronic machines (for short, to be referred to as 'voting machines ').
This was done in pursuance of the direction issued by the Election Commission of India (for facility, to be referred to as the 'Commission ') by virtue of a notification published in the Kerala Gazette on 13.5.82.
The said notification was purported to have been made under article 324 of the Constitution of India, and has been extracted on pages 3 to 5 of the judgment of the High Court and it is not necessary for us to repeat the same having regard to the point of law that we have to decide in the instant case.
It may be mentioned that prior to issuing the notification the commission had sought the sanction of the Government of India which was however refused.
As mentioned above, the votes 77 by the mechanical process were cast in 50 out of the 85 polling stations.
The trial Court upheld the validity of voting by machine and held that the respondent was duly elected to the Assembly seat.
Hence, this appeal by the appellant.
article 324 of the Constitution gives full powers to the Commission in matters of Superintendence, direction and control of the preparation of electoral rolls and also for the conduct of elections to the Parliament and State Legislatures.
It was argued that the Commission being a creature of the Constitution itself, its plenary powers flowing directly from article 324 will prevail over any Act passed by the Parliament or Rules made thereunder.
In order to buttress this argument, it was contended that the manner of voting was a matter coming within the ambit of articles 324 and 327 which empowered the Parliament to make laws in respect of matters relating to or in connection with the elections to the Parliament or the State Legislatures and would be deemed to be subsidiary to the power contained in article 324 and if there was any conflict between a law enacted by the Parliament and the powers given to the Commission regarding regulating the conduct of elections to Parliament that law must yield to article 324, otherwise the very object of article 324 would be defeated.
Notice was given by this Court both to the Union of India as also the Commission though in terms of section 82 of the Act they are not necessary parties and were not before the High Court.
This is a very attractive argument but on a closer scrutiny and deeper deliberation on this aspect of the matter, it is not possible to read into article 324 such a wide and uncanalised power, which is entrusted to the Commission as Mr. Jethmalani would have us believe.
Part XV of the Constitution contains articles 324 to 328 which relate to the manner in which elections are to be held, the rights of persons who are entitled to vote, preparation of electoral rolls, delimitation of constituencies, etc., but this is merely the storehouse of the powers and the actual exercise of these powers is left to Parliament under articles 325 to 329.
In other words, article 324 has to be read in harmony with, and not in isolation of articles 326 to 329.
article 324 may be extracted thus: "324.
Superintendence, direction and control of elections to be vested in an Election Commission.
78 (1) The superintendence, direction and control of the preparation of the electoral rolls for, and the conduct of all elections to Parliament and to the Legislature of every State and of elections to the offices of President and Vice President held under this Constitution shall be vested in a Commission (referred to in this Constitution as the Election Commission).
(2) The Election Commission shall consist of the Chief Election Commissioner and such number of other Election Commissioners, if any, as the President may from time to time fix and the appointment of the Chief Election Commissioner and other Election Commissioners shall, subject to the provisions of any law made in that behalf by Parliament, be made by the President.
(3) When any other Election Commissioner is so appointed the Chief Election Commissioner shall act as the Chairman of the Election Commission.
(4) Before each general election to the House of the People and to the Legislative Assembly of each State, and before the first general election and thereafter before each biennial election to the Legislative Council of each State having such Council, the President may also appoint after consultation with the Election Commission such Regional Commissioners as he may consider necessary to assist the Election Commission in the performance of the functions conferred on the Commission by clause (1).
(5) Subject to the provisions of any law made by Parliament, the conditions of service and tenure of office of the Election Commissioners and the Regional Commissioners shall be such as the President may by rule determine: Provided that the Chief Election Commissioner shall not be removed from his office except in like manner and on the like grounds as a Judge of the Supreme Court and the conditions of service of the Chief Election Commissioner shall not be varied to his disadvantage after his appointment.
Provided further that any other Election Commissioner or a Regional Commissioner shall not be removed from 79 office except on the recommendation of the Chief Election Commissioner.
(6) The President, or the Governor of a State, shall when so requested by the Election Commission, make available to the Election Commission or to a Regional Commissioner such staff as may be necessary for the discharge of the functions conferred on the Election Commission by clause (1).
" While interpreting a constitutional provision we must remember the memorable words of Chief Justice Marshall: "We must never forget that it is the Constitution which we are expounding." Another golden rule laid down by this Court on the interpretation of statutes is that we should so interpret the language of a Statute as to suppress the mischief and advance the object.
It is true that article 324 does authorise the Commission to exercise powers of superintendence, direction and control of preparation of electoral rolls and the conduct of elections to Parliament and State legislatures but then the Article has to be read harmoniously with the Articles that follow and the powers that are given to the Legislatures under entry No. 72 in the Union List and entry No. 37 of the State List of the Seventh Schedule to the Constitution.
The Commission in the garb of passing orders for regulating the conduct of elections cannot take upon itself a purely legislative activity which has been reserved under the scheme of the Constitution only to Parliament and the State legislatures.
By no standards can it be said that the Commission is a third Chamber in the legislative process within the scheme of the Constitution.
Merely being a creature of the Constitution will not give it plenary and absolute power to legislate as it likes without reference to the law enacted by the legislatures.
It was further argued that this power was necessary in order to make the Commission an independent body and in this connection our attention was drawn to a speech of Dr. Ambedkar in the Constituent Assembly when the question of making the Election Commission an independent body was being debated, At page 905, Constituent Assembly Debates (Vol.8), Dr. Ambedkar observed thus: 80 "But the House affirmed without any kind of dissent that in the interests of purity and freedom of elections to the legislative bodies, it was of the utmost importance that they should be freed from any kind of interference from the executive of the day.
In pursuance of the decision of the House, the Drafting Committee removed this question from the category of Fundamental Rights and put it in a separate part containing Articles 289, 290 and so on, Therefore, so far as the fundamental question is concerned that the election machinery should be outside the control of the executive Government, there has been no dispute.
What article 289 does is to carry out that part of the decision of the Constituent Assembly.
It transfers the superintendence, direction and control of the preparation of the electoral rolls and of all elections to Parliament and the Legislatures of States to a body outside the executive to be called the Election Commission.
" These observations merely show that the intention of the founding fathers of our Constitution was to make the Commission a separate and independent body so that the election machinery may be outside the control of the executive Government.
What Dr. Ambedkar, or for that matter the founding fathers, intended was that the superintendence, direction and control of the preparation of electoral rolls and of all elections to Parliament and State Legislatures should be left to the Election Commission.
This object has been fully carried out by the provisions in articles 324 to 329.
Neither the observations of Dr. Ambedkar nor the provisions of the Constitution could ever have intended to make the Commission an apex body in respect of matters relating to elections, conferring on it legislative powers ignoring the Parliament altogether.
Mr. Asoke Sen, appearing for the Commission, speaking in the same strain as Mr. Jethmalani, contended that article 324 was a Code in itself and was couched in a very plain and simple language which admits of no ambiguity and, if so construed, it gives full powers and authority to the Commission to give any direction in connection with the conduct of elections.
It was further submitted that if this interpretation is not given then articles 325 to 329 would amount to defeating the very object which was sought to be achieved by article 324.
Supporting argument was built up by Mr. Sen by heavily relying upon the opening words in article 327 to 81 the effect: "subject to the provisions of this Constitution" and absence of any such rider in article 324.
For the reasons which we will give hereafter, it is not possible for us to accept the somewhat far fetched argument of the learned counsel.
Reliance was placed on a decision of this Court in Sadiq Ali and Anr.
vs Election Commission of India and Ors.
where the Court observed thus: "article 324 of the Constitution provides inter alia that the superintendence, direction and control of the preparation of electoral rolls for and the conduct of all elections to Parliament and Legislative Assemblies of the States and all elections to the offices of President and Vice President held under the Constitution shall be vested in the Commission Without prejudice to the generality of the foregoing power, sub section (2) enumerates some of the matters for which provision may be made in the rules.
Sub section (3) requires that the rules framed should be laid before each House of Parliament.
Conduct of Election Rules, 1961 were thereafter framed by the Central Government.
Rules 5 of those Rules requires the Commission to specify the symbols that may be chosen by candidates at elections in Parliamentary and Assembly elections and the restrictions to which that choice shall be subject.
Rule 10 makes provision for allotment of symbols to the contesting candidates by the Returning officer subject to general or special directions issued by the Commission.
" The first part of the above observations merely repeats the language of article 324 but the second part clearly shows that the power under article 324 is conditioned by the Rules made by the Central Government for the conduct of all elections.
These observations, therefore, do not appear to us to be of any assistance to the stand taken by the appellant.
Reliance was also placed on the following observations in the said case: "Question then arises as to what is the binding nature of the decision given by the Commission under paragraph 15 In this respect, it has to be borne in mind that the Commission only decides the question as to whether any of the 82 rival sections or groups of a recognised political party, each of whom claims to be that party, is that party.
The claim made in this respect is only for the purpose of symbols in connection with the elections to the Parliament and State Legislatures and the decision of the Commission pertains to this limited matter." (Emphasis ours) These observations also do not advance the matter any further because it was clearly held that the claim made in respect of symbols pertained only to the limited matter which was being considered by the Commission.
The following observations of this Court in that case completely clinch the issue against the appellant: "It would follow from what has been discussed earlier in this judgment that the Symbols order makes detailed provisions for the reservation, choice and allotment of symbols and the recognition of political parties in connection therewith.
That the Commission should specify symbols for elections in Parliamentary and assembly constituencies has also been made obligatory by rule 5 of Conduct of Election Rules." (Emphasis supplied) Thus, it is manifestly apparent from this decision that the rule making power of the Commission under the Act, with respect to symbols, would have to prevail over any order that it may pass and the words "conduct of elections" would not make the Commission a purely legislative body.
Another case on which great reliance was placed is: Mohinder Singh Gill and Anr.
vs The Chief Election Commissioner, New Delhi and Ors.
In this case, it was held that an order passed by a statutory functionary on certain specific grounds cannot be supplemented by external evidence like affidavits or otherwise.
This case also nowhere lays down that the Commission possesses plenary powers both executive and legislative in the guise of conduct of elections.
One of the main questions posed by Krishna Iyer, J speaking for the Court, was as follows: "Can the Election Commission, clothed with the comprehensive functions under Article 324 of the Constitution, cancel the whole poll of a constituency after it has been 83 held, but before the formal declaration of the result has been made, and direct a fresh poll without reference to the guidelines under sections 58 and 64(a) of the Act, or other legal prescription or legislative backing.
If such plenary power exists, is it exercisable on the basis of his inscrutable 'subjective satisfaction ' or only on a reviewable objective assessment reached on the basis of circumstances vitiating a free and fair election and warranting the stoppage of declaration of the result and directions of a fresh poll not merely of particular polling stations but of the total constituency?" The learned Judge while answering the question observed thus: "Article 324, which we have set out earlier, is a plenary provision vesting the whole responsibility for national and State elections and, therefore, the necessary powers to discharge that function.
It is true that article 324 has to be read in the light of the constitutional scheme and the 1950 Act and the 1951 Act.
Sri Rao is right to the extent he insists that if competent legislation is enacted as visualized in Article 327 the Commission cannot make himself free from the enacted prescriptions.
And the supremacy of valid law over the Commission argues itself.
No one is an imperium in imperio in our constitutional order.
It is reasonable to hold that the Commissioner cannot defy the law armed by article 324.
Likewise, his functions are subject to the norms of fairness and he cannot act arbitrarily.
Unchecked power is alien to our system.
Article 324, in our view, operates in areas left unoccupied by legislation and the words 'superintendence, direction and control ' as well as 'conduct ' of all elections ' are the broadest terms." (Emphasis ours) The observations, extracted above, furnish a complete answer to the arguments of Mr. Jethmalani and Mr. Asoke Sen as it has been clearly held that article 324 would operate only in areas left unoccupied by legislation, even if the widest possible connotation is given to the language of article 324.
While summarizing the propositions, the Court made the following observations:. "Two limitations at least are laid on its plenary 84 character in the exercise thereof.
Firstly, when Parliament or any State Legislature has made valid law relating to or in connection with elections, the Commission shall act in conformity with, not in violation of such provision but where such law is silent article 324 is a reservoir of power to act for the avowed purpose of, not divorced from pushing forward a free and fair election with expedition.
Secondly, the Commission shall be responsible to the rule of law, act bona fide and be amenable to the norms of natural justice in so far as conformance to such canons can reasonably and realistically be required of it as fairplay in action in a most important area of the constitutional order, viz., elections." (Emphasis ours) This is actually the main spirit and gist of the decision which appears to have been relied upon by the appellant but which does not at all support his stand.
In the aforesaid case, there did not appear to be any conflict between the order passed by the Commission and the Act or the Rules.
The question at issue in the instant case did not really arise in the form and shape as has been presented before us.
On the other hand, the matter seems to have been fully settled by an earlier decision of this Court in N.P. Ponnuswami vs Returning officer, Namakkal Constituency and ors.
where Fazal Ali, J. (as he then was) while making a very pointed and crisp approach, scientifically analysed the position thus: "Broadly speaking, before an election machinery can be brought into operation, there are three requisites which require to be attended to, namely, (1) there should be a set of laws and rules making provisions with respect to all matters relating to, or in connection with, elections, and it should be decided as to how these laws and rules are to be made; (2) there should be an executive charged with the duty of securing the due conduct of elections; and (3) there should be a judicial tribunal to deal with disputes arising out of or in connection with elections.
Articles 327 and 328 deal with the first of these requisites, article 324 with the second and article 329 with the third requisite.
The other two articles in Part XV, viz., articles 325 and 326, deal with two 85 matters of principle to which the Constitution framers have attached much importance.
They are: (1) prohibition against discrimination in the preparation of, or eligibility for inclusion in, the electoral rolls, on grounds of religion race, caste, sex or any of them; and (2) adult suffrage.
Part XV of the Constitution is really a code in itself providing the entire ground work for enacting appropriate laws and setting up suitable machinery for the conduct of elections.
" We fully endorse and follow the above observations of the Constitution Bench which lay down the correct law on the subject and we have nothing further to add to the approach made by this Court in the case referred to above.
On the other hand, our view that articles 324 to 329 have to be construed harmoniously flows as a logical corollary from the ratio in Ponnuswami 's case.
The pointed an pungent observations extracted above, really amount to a Bible of the election law as culled out from an interpretation of the provisions of articles 324 to 329 of the Constitution, and were referred to with approval even in Mohinder Singh Gill 's case (supra).
During the last three decades this case has neither been distinguished nor dissented from and still holds the field and with due respect, very rightly.
No other case ever made such a dynamic and clear approach to the problem, perhaps due to the fact that no such occasion arose because the Commission has always been following the provisions of the Act and the Rules and had never attempted to arrogate to itself powers which were not meant to belong to it.
Indeed, if we were to accept the contention of the respondents it would convert the Commission into an absolute despot in the field of election so as to give directions regarding the mode and manner of elections by passing the provisions of the Act, and the Rules purporting to exercise powers under cover of Art, 324.
If the Commission is armed with such unlimited and arbitrary powers and if it ever happens that the persons manning the commission shares or is wedded to a particular ideology, he could by giving odd directions cause a political havoc or bring about a constitutional crisis, setting at naught the integrity and independence of electoral process, so important and indispensable to the democratic system.
Further, such an absolute and uncanalised power given to the Commission without providing any guidelines would itself destroy the basic structure of the Rule of Law.
It is manifest 86 that such a disastrous consequence could never have been contemplated by the Constitution makers, for such an interpretation, as suggested by the counsel for the respondent, would be far from attaining the goal of purity and sanctity of the electoral process.
Hence, we must construe articles 324 to 329 as an integral part of the same scheme collaborating rather than colliding with one another.
Moreover, a perusal of articles 324 to 329 would reveal that the legislative powers in respect of matters relating to Parliament or the State Legislatures vests in Parliament and in no other body.
The Commission would come into the picture only if no provision has been made by Parliament in regard to the elections to the Parliament or State Legislatures.
Furthermore, the power under article 324 relating to superintendence, direction and control was actually vesting of merely all the executive powers and not the legislative powers.
In other words, the legislative power of Parliament or of the legislature of a State being made subject to article 324 only means that no law made by Parliament under article 327 or by a State legislature under article 328 can take away or deprive the Commission of the executive power in regard to matters entrusted to it, viz. superintendence, direction and control of elections.
The right to file an election petition directly flows from article 329 and cannot be affected in any manner by the exercise of executive power by the Commission under article 324.
In view of the above, it is not necessary for us to consider a number of other authorities that were cited before us as they do not appear to be directly on point.
It is pertinent to indicate that the High Court fell into an obvious fallacy by acceptance of the position that the direction of the Commission was intended to operate in an uncovered field.
When the Act and the Rules, prescribed a particular method of voting, the Commission could not innovate a new method and contend that use of the mechanical process was not covered by the existing law and, therefore, did not come in conflict with the law in the field.
To sum up, therefore, the legal and constitutional position is as follows: (a) When there is no Parliamentary legislation or rule made under the said legislation, the Commission is free to pass any orders in respect of the conduct of elections.
87 (b) where there is an Act and express Rules made thereunder it is not open to the Commission to override the Act or the Rules and pass orders in direct disobedience to the mandate contained in the Act or the Rules.
In other words, the powers of the Commission are meant to supplement rather than supplant the law (both statute and Rules) in the matter of superintendence, direction and control as provided by article 324, (c) where the Act or the Rules are silent, the Commission has no doubt plenary powers under article 324 to give any direction in respect of the conduct of election, and (d) where a particular direction by the Commission is submitted to the government for approval, as required by the Rules, it is not open to the Commission to go ahead with implementation of it at its own sweet will even if the approval of the Government is not given.
Apart from the arguments referred to above, an alternative argument put forward before us was that even the Rules framed under the Act authorise the Commission to give direction to hold voting by the use of a voting machine and this is covered by section 59 of the Act and Rule 49 of the Rules.
This argument merits serious consideration.
In the instant case, the main grievance of appellant is that the voting by mechanical process was not permissible either under the Act or under the Rules.
Reliance was, however, placed by the appellant on s.59 of the Act which runs thus: "59.
Manner of voting at elections At every election where a poll is taken votes shall be given by ballot in such manner as may be prescribed, and no votes shall be received by proxy.
" It is obvious that section 59 uses the words "ballot in such manner as may be prescribed", which means prescribed by the Rules made under the Act.
A reference to section 61 of the Act would show that Parliament intended use of ballot paper only for casting of votes.
This takes us to rule 49, the relevant part of which may be extracted thus: "49.
Voting by ballot at notified polling stations (1) Notwithstanding any thing contained in the 88 preceding provisions of this Part, the Election Commission may, by notification published in the official Gazette at least 15 days before the date, or the first of the dates, of poll appointed for an election, direct that the method of voting by ballot shall be followed in that election at such polling stations as may be specified in the notification.
" It was submitted that having regard to the modern and changing conditions of the society a dynamic approach should be made to the interpretation of the aforesaid two legal requirements.
The matter does not rest here: something could be said for the view that the word 'ballot ' includes voting by machines.
Section 59 proceeds to explain its intention in setting up the mode, manner and method of voting by prescribing express rules as to how the voting should be done.
In this connection, reference may be made to Rule 22 which relates to the form of ballot paper and its contents.
Rule 23 requires the Returning officer to record on the counterfoil of the ballot paper the electoral roll number of the elector as entered in the marked copy of the electoral roll.
Rule 27 refers to the return of ballot paper after an elector has recorded his vote or made his declaration.
Rule 30, which prescribes the contents of ballot papers, is completely contrary to the concept of ballot by machine.
Similarly, Rules 33, 38, 39 and 40 seem to be wholly inconsistent with the mechanical process but seem to adopt the conventional method.
As we have already indicated, these Rules are binding on the Commission and it cannot by an executive fiat either override them or act contrary to the statutory provisions of the Rules.
On a proper and detailed analysis of these Rules it is clear that the Act by framing the Rules completely excluded the mechanical process which, if resorted to, would defeat in a large measure the mandatory requirements of the Rules.
It is a well settled rule of interpretation of statutes that words, phrase or sentences of a statute should ordinarily be understood in their natural, ordinary, popular and grammatical sense unless such a construction leads to absurdity.
Mr. Jethmalani argued that the word 'ballot ' is wide enough to include the mechanical process and, therefore, the direction of the Commission falls squarely within the four corners of both section 59 and Rule 49.
Reliance was placed on the dictionary meaning of the word 'ballot ' which has been defined in Black 's Law Dictionary (Fourth Edn.) at page 182 thus: 89 "means act of voting, usually in secret, by balls or by written or printed tickets or slips of paper; the system of voting by balls or tickets, or by any device for casting or recording votes, as by voting machine." In Stroud 's Judicial dictionary (Third Edn.), however, 'ballot ' means "votes recorded all ballot papers put into the ballot boxes by the electors (p. 3239)".
Stroud therefore, does not subscribe to the view of casting of vote through a voting machine and we agree with this view because casting of votes by machine is a mechanical process, which has come into existence long after the Act was passed and is not generally invoked in most of the democratic countries of the world.
Concise Oxford dictionary defines the word 'ballot ' thus: "(usu.
secret) voting, small ball, ticket or paper used in voting; votes so recorded; lot drawing.
" In Webster 's Third New International Dictionary (Vol. 1) at page 168 'ballot ' is defined thus: "to obtain a vote from (a body of voters) (the men on the proposal), to select by ballot or by the drawing of lots.
" It may be mentioned here that the word 'ballot ' has been derived from the word 'ballot ' which existed at a time when there was no question of any system of voting machine.
Even in 1951 when the Act was passed or the Rules were made, the system of voting by machine was not in vogue in this country.
In these circumstances, therefore, we are constrained to hold that the word 'ballot ' in its strict sense would not include voting by the use of voting machines.
Legislatures must be deemed to be aware of the modern tendencies in various democratic countries of the world where the mechanical system has been introduced and if despite the plain meaning of the word 'ballot ' they did not choose to extend the definition given as far back as 1950, it may be safely presumed that the Parliament intended to use the word 'ballot ' in its popular rather than a technical sense.
Our view finds a good deal of support from the circumstance that even though the system of voting by mechanical process was submitted to the Government for approval yet the same was declined which shows that the rule making authority was not prepared to switch over to the system of 90 voting by machines, perhaps on account of the legal bar as indicated by us.
It is rather unfortunate that the Union of India which is a party to this case, has taken a very neutral stand by neither supporting nor opposing the direction given by the Commission.
Having regard to these circumstances, therefore, we are clearly of the opinion that according to the law as it stands at present, the order of the Commission directing casting of ballot by machines in some of the polling stations, as indicated above, was without jurisdiction and could not have been resorted to.
It was further pointed out by the respondent that the process of voting by machines is very useful as it eliminates a number of drawbacks and expedites, to a great extent, the declaration of the result of the election by eliminating the process of counting of votes from the ballot boxes.
On the other hand, the appellant has pointed out a number of defects, some of them being of a vital nature, which would defeat the electoral process.
We would now indicate some of the apparent defects which were pointed out to us by the counsel for the appellant after giving a demonstration of the voting machine before us: "The absence of a provision for identifying the candidate for whom a void vote has been cast (a) by impersonating a dead voter, (b) by impersonating an absentee voter, (c) by the genuine voter who tenders a vote after a vote has been cast in his name by an impersonator (R. 42), (d) where a vote is void having been cast after closing time (R. 43) (e) where the voter has cast votes in more than one booth in the same constituency [section 62(2)], (f) where the voter has cast two votes in two constituencies [section 63(3)], (g) where the voter is disqualified under section 16 of the Act [section 62(4)], 91 (h) where an elector marks a ballot paper wrongly for a candidate, he loses the right to get a fresh ballot paper for casting his vote correctly (R.41).
The provisions of section 100(1)(d) and more so section 101(a) and (b) under which by excluding the void votes or votes cast as a result of corrupt practices any other candidate can be declared duly elected as the true representative of the constituency.
" On the other hand, a number of advantages which could be obtained by using the mechanical process were pointed out by the respondent, the sum and substance of which was that despite some defects the electoral process would be expeditious and would cut out a number of delays or mistakes committed at various stages.
The fact, however, remains that if the mechanical process is adopted, full and proper training will have to be given to the voters which will take quite some time.
However, we refrain from making any comments on either the defects or advantages of voting machines because it would be for the Legislature and the Government, if it revises its decision at one time or the other, to give legal sanction to the direction given by the Commission.
For these reasons, it is not necessary for us to go into the very detailed notes of arguments submitted by the parties in respect of this aspect of the matter.
Lastly, it was argued by the counsel for the respondents that the appellant would be estopped from challenging the mechanical process because he did not oppose the introduction of this process although he was present in the meeting personally or through his agent.
This argument is wholly untenable because when we are considering a constitutional or statutory provision there can be no estoppel against a statute and whether or not the appellant agreed or participated in the meeting which was held before introduction of the voting machines, if such a process is not permissible or authorised by law he cannot be estopped from challenging the same .
For the reasons given above, we allow the appeal, set aside the election of the respondent with respect to the 50 polling stations where the voting machines were used and we direct a repoll to be held in these 50 polling stations.
We, however, do not touch or disturb the results of the votes secured in the other 34 polling stations which was done in accordance with law, viz., 92 the use of ballot papers.
After the repoll, the result of the election would be announced afresh after taking into account the votes already secured by the candidates, including the Respondent.
We make no order as to costs.
In course of argument, Mr. Sen for the Commission informed us that at eleven elections held under the Act, the mechanical device was used and in nine, no challenge has been raised.
It follows that our judgment will not affect those nine elections in any manner.
N.V.K. Appeal allowed.

dataset_name: IN-Abs

summary:
The first respondent was elected to the State Legislative Assembly.
Voting in the Constituency was by the conventional method provided in the Conduct of Election Rules 1961.
the votes cast manually; and also by the mechanical process, viz., the use of 'electronic ' machines.
The appellant challenged the election of the first respondent.
The trial court upheld the validity of voting by machines and held that the first respondent was duly elected.
In appeal to this Court, it was contended on behalf of the appellant that voting by mechanical process was not permissible either under the Representation of the People Act 1951, or under the Conduct of Election Rules 1961.
Allowing the appeal, ^ HELD: 1.
The order of the Election Commission directing casting of ballots by machines in some of the polling stations, was without jurisdiction and could not have been resorted to.
[90G] 2.
When the Representation of the People Act 1951 and the Conduct of Election Rules 1961, prescribed a particular method of voting the Commission could not innovate a new method and contend that use of the mechanical process was not covered by the existing law and, therefore, did not come in conflict with the law in the field.
The Act and the Rules completely excluded the mechanical process which, if resorted to, would defeat in a large measure the mandatory requirements of the Rules.
[86G, 88F] 75 3.
(a) When there is no Parliamentary legislation or rule made under the said legislation, the Commission is free to pass any orders in respect of the Conduct of elections.
[86 H] (b) Where there is an Act and there are express Rules made thereunder, it is not open to the Commission is over ride the Act or the Rules and pass orders in direct disobedience to the mandate contained in the Act or the Rules.
The Powers of the Commission are meant to supplement rather than supplant the law (both statute and Rules) in the matter of superintendence, direction and Control as provided by Article 324.
[87A B] (c) Where the Act or the Rules are silent, the Commission has no doubt plenary powers under Article 324 to give any direction in respect of the conduct of election.
[87C] (d) Where a particular direction by the Commission is submitted to the government for approval, as required by the Rules, it is not open to the Commission to go ahead with implementation of it at its own sweet will even if the approval of the Government is not given.
[87D] 4.
It is a well settled rule of interpretation of statutes that words, phrases or sentences of a statute should ordinarily be understood in their natural, ordinary, popular and grammatical sense unless such a construction leads to absurdity.
[88G] 5.
Legislatures must be deemed to be aware of the modern tendencies in various democratic countries of the world where the mechanical system has been introduced and if despite the plain meaning of the word 'ballot ' they did not choose to extend the definition given as far back as 1950, it may be safely presumed that Parliament intended to use the word 'ballot ' in its popular rather than a technical sense.
[89G] 6.
The word 'ballot ' has been derived from the word 'ballot ' which existed at a time when there was no question of any system of voting by machine.
Even in 1951 when the Act was passed or the Rules were made, the system of voting by machine was not in vogue in this country.
In these circumstances the word 'ballot ' in its strict sense would not include voting by the use of voting machines.
[89F] Sadiq Ali & Anr.
vs Election Commission of India & Ors.
,[1972] 2 S.C.R. 318; Mohinder Singh Gill & Anr.
vs The Chief Election Commissioner, New Delhi & Ors., and N P: Ponnuswami vs Returning Officer, Namakkal Constituency & Ors., ; ; referred to.