judgement:
Appeal No. 583 of 1961.
Appeal by special leave from the Judgment and decree dated August 12, 1959, of the Rajasthan High Court in Civil Misc.
First Appeal No. 50 of 1956.
Gopal Singh, for the appellant.
B. P. Maheshwari, for the respondent.
April 22, 1964.
The Judgment of the Court was delivered by AYYANGAR, J.
The facts giving rise to this appeal, by special leave, are briefly as folows: The respondent Bhooralal brought a suit Civil Suit 20 1954 in the Court of the Subordinate Judge, First Class, Kekri against the appellant claiming possession of certain property which was described in the plaint and for mesne profits.
The allegation in the plaint was that the plaintiff was the absolute owner of the said property of which the defendant was in wrongful possession and that in spite of demands he had failed to vacate the same and was therefore liable to pay the mesne profits claimed.
In the plaint he made reference to a previous suit that had been filed by him and his mother (C.S. 28 of 1950) wherein a claim had been made against the defendant for the recovery of the mesne profits in regard to the same property for the period ending with February 10, 1950.
It was also stated that mesne profits had been decreed in the said suit.
In the Written Statement that was filed by the present appellant, besides disputing the claim of the plaintiff to the reliefs prayed for on the merits, a technical plea to the maintainability of the suit was also raised in these terms: "That 0.
r. 2, Civil Procedure Code is a bar to the suit.
When the suit referred to in paragraph 2 of the plaint was filed the plaintiff had a cause of action for the reliefs also.
He having omitted to sue for possession in that suit, is now barred from claiming relief of possession.
No second suit for recovery of mesne profits is maintainable in law.
833 Since the plaintiff had lost his remedy for the relief of possession he cannot seek recovery of mesne profits also.
" On these pleadings the learned Subordinate Judge framed 5 issues and of these the 4th issue ran: "Whether 0.
r. 2, Civil Procedure Code is a bar?".
Before evidence was led by the parties issue No. 4 was argued before the learned trial Judge as a preliminary issue and the Court recorded a finding that the suit was barred by the provision named and directed the dismissal of the suit.
The plaintiff preferred an appeal from this decree to the additional District Judge and the appellate Court considered this plea as regards the bar under 0.
r. 2, Civil Procedure Code on two alternative bases.
In the first place, the learned District Judge pointed out that the pleadings in the earlier suit C.S. 28 of 1950 had not been field in the case and made part of the record, so that it was not known what the precise allegations of the plaintiff in his previous suit were.
For this reason the learned District Judge held that the plea of a bar under 0.
r. 2, Civil Procedure Code should not have been entertained at all.
He also considered the question as to whether, if the plea was available, it could have succeeded.
On this he referred to the conflict of Judicial opinion on this point and held that if the point did arise for decision he would have decided in favour of the plaintiff and treated the cause of action for a suit for mesne profits as different from the cause of action for the relief of possession of property from a trespasser.
In view, however, of his finding on the first point as to there being no material on the record to justify the plea of a bar under 0. 2.
r. 2, Civil Procedure Code the learned District Judge did not rest his decision on his view of the law as regards the construction of 0. 2.
r. 2(3).
In the circumstances he set aside the dismissal of the suit and remanded it to the trial Court for being decided on the merits in accordance with the law.
The defendant the appellant before us preferred a second appeal to the High Court of Rajasthan and the learned Single Judge dismissed this appeal.
It is from this judgment that the appellants have preferred this appeal after obtaining special leave.
As already indicated, there is a conflict of judicial opinion on the question whether a suit for possession of immoveable property and a suit for the recovery of mesne profits from the same property are both based on the same cause of action, for it is only if these two reliefs are based on "the same cause of action" that the plea of 0.
, Civil Procedure Code 1, P(D)ISCI 27 834 that was raised by the appellant could succeed.
Clause (3)of O. 2.
r. 2, Civil Procedure Code that is relevant in this context reads: (3) A person entitled to more than one relief in respect of the same cause of action may sue for all or any of such reliefs, but if he omits, except with the leave of the Court, to sue for all such reliefs, he shall not afterwards sue for any reliefs so omitted.
" Some of the High Courts, notably Madras, have in this con nection, referred to the terms of 0.
2. r. 4 which runs: "R. 4.
No cause of action shall, unless with the leave of the Court, be joined with a suit for the recovery of immoveable property, except (a) claims for mesne profits or arrears of rent in respect of the property claimed or any part thereof; (b) claims for damages for breach of any contract under which the property or any part thereof is held; and (c) claims in which the relief sought is based on the same cause of action: Provided that nothing in this rule shall be deemed to prevent any party in a suit for foreclosure or redemption from asking to be put into possession of the mortgaged property".
as an aid to the construction of the term 'cause of action ' and the expression 'relief based on the same cause of action ' in 0. 2. r. 2(3).
Reading these two provisions together it has been held that the cause of action for suits for possession of immoveable property and the cause of action for a suit in respect of mesne profits from the same property are distinct and different.
On the other hand, it has been held, particularly by the High Court of Allahabad that the basis of a claim for mesne profits is wrongful possession of property and so is a claim for possession and thus the cause of action for claiming either relief is the same viz., wrongful possession of property to which the plaintiff is entitled.
On this reasoning it has been held that a plaintiff who brings in the first instance a suit for possession alone or for mesne profits alone is afterwards debarred from suing for the other relief under 0. 2.
r. 2(3).
The learned trial Judge had, after referring to the ,conflict of authority, expressed his preference for the Allahabad view and had, therefore, upheld the defence.
At the stage of the appeal the learned District Judge had, as already pointed out, expressed his preference for the other view.
The 835 learned Single Judge expressed his concurrence with the learned District Judge in preferring the Madras view as against the decisions of the Allahabad High Court.
Learned counsel for the appellant sought to argue that the Allahabad view was more in accordance with principle and with the proper construction of 0. 2.
r. 2(3), Civil Proce dure Code.
We do not consider it necessary to examine this conflict of judicial opinion in this case as, in our opinion, the learned District Judge was right in holding that the appellant had not placed before the Court material for the purpose of founding a plea of 0.
r. 2, Civil Procedure Code.
In order that a plea of a bar under 0. 2. r. 2(3), Civil Procedure Code should succeed the defendant who raises the plea must make out (1) that the second suit was in respect of the same cause of action as that on which the previous suit was based, (2) that in respect of that cause of action the plaintiff was entitled to more than one relief, (3) that being thus entitled to more than one relief the plaintiff, without leave obtained from the Court, omitted to sue for the relief for which the second suit had been filed.
From this analysis it would be seen that the defendant would have to establish primarily and to start with, the precise cause of action upon which the previous suit was filed, for unless there is identity between the cause of action on which the earlier suit was filed and that on which the claim in the later suit is based there would be no scope for the application of the bar.
No doubt, a relief which is sought in a plaint could ordinarly be traceable to a particular cause of action but this might, by no means, be the universal rule.
As the plea is a technical bar it has to be established satisfactorily and cannot be presumed merely on basis of inferential reasoning.
It is for this reason that we consider that a plea of a bar under 0. 2.
r. 2, Civil Procedure Code can be established only if the defendant files in evidence the pleadings in the previous suit and thereby proves to the Court the identity of the cause of action in the two suits.
It is common ground that the pleadings in C.S. 28 of 1950 were not filed by the appellant in the present suit as evidence in support of his plea under 0.
r. 2, Civil Procedure Code.
The learned trial Judge, however, without these pleadings being on the record inferred what the cause of action should have been from the reference to the previous suit contained in the plaint as a matter of deduction.
At the stage of the appeal the learned District Judge noticed this lacuna in the appelllant 's case and pointed out, in our opinion rightly, that without the plaint in the previous suit being on the record, a plea of a bar under 0.
r. 2, Civil Procedure Code was not main tainable.
Learned counsel for the appellant, however, drew our attention to a passage in the judgment of the learned Judge in the High Court which read: LP(D)ISCl 27(a) 836 "The plaint, written statement or the judgment of the earlier court has not been filed by any of the parties to the suit.
The only document filed was the judgment in appeal in the earlier suit.
The two courts have, however, freely cited from the record of the earlier suit.
The counsel for the parties have likewise done so.
That file is also before this Court.
" It was his submission that from this passage we should infer that the parties had, by agreement, consented to make the pleadings in the earlier suit part of the record in the present suit.
We are unable to agree with this interpretation of these ,observations.
The statement of the learned Judge "the two courts have, however, freely cited from the record of the ,earlier suit" is obviously inaccurate as the learned District Judge specifically pointed out that the pleadings in the earlier suit were not part of the record and on that very ground had rejected the plea of the bar under 0. 2.
r. 2, Civil Procedure Code.
Nor can we find any basis for the suggestion that the learned Judge had admitted these documents at the second appeal stage under 0.
r. 27, Civil Procedure Code by consent of parties.
There is nothing on the record to suggest such an agreement or such an order, assuming that additional evidence could legitimately be admitted in a second appeal under 0.
r. 27, Civil Procedure Code.
We can therefore proceed only on the basis that the pleadings in the earlier suit were not part of the record in the present suit.
Learned counsel for the appellant, however, urged that in his plaint in the present suit the respondent had specifically referred to the previous suit having been for mesne profits and that as mesne profits could not be claimed except from a trespasser there should also have been an allegation in the previous suit that the defendant was a trespasser in wrongful possession of the property and that alone could have been the basis for claiming mesne profits.
We are unable to accept this argument.
In the first place, it is admitted that the plaint in the present suit was in Hindi and that the word `mesne profits ' is an English translation of some expression used in the original.
The original of the plaint is not before us and so it is not possible to verify whether the expression `mesne profits ' is an accurate translation of the expression in the original plaint.
This apart, we consider that learned counsel 's argument must be rejected for a more basic reason.
Just as in the case of a plea of res judicata which cannot be established in the absence on the record of the judgment and decree which is pleaded as estoppel, we consider that a plea under 0.
r. 2, Civil Procedure Code cannot be made out except on proof of the plaint in the previous suit the filing of which is said to create the bar.
As the plea is basically founded 837 on the identity of the cause of action in the two suits the ,defence which raises the bar has necessarily to establish the ,cause of action in the previous suit.
The cause of action would be the facts which the plaintiff had then alleged to support the right to the relief that he claimed.
Without placing before the Court the plaint in which those facts were alleged, the defendant cannot invite the Court to speculate or infer by a process of deduction what those facts might be with reference to the reliefs which were then claimed.
It is not impossible that reliefs were claimed without the necessary averments to justify their grant.
From the mere use of the words `mesne profits ' therefore one need not necessarily infer that the possession of the defendant was alleged to be wrongful.
It is also possible that the expression 'mesne profits ' has been used in the present plaint without a proper appreciation of its significance in law.
What matters is not the characterisation of the particular sum demanded but what in substance is the ,allegation on which the claim to the sum was based and as regards the legal relationship on the basis of which that relief was sought.
If is because of these reasons that we consider that a plea based on the existence of a former pleading cannot be entertained when the pleading on which it rests has not been produced.
We therefore consider that the order of remand passed by the learned Additional District Judge which was confirmed by the learned Judge in the High Court was right.
The merits of the suit have yet to be tried and this has been directed by the order of remand which we are affirming.
The appeal fails and is dismissed.
In the circumstances of the case there will be no order as to costs.
Appeal dismissed.

summary:
The plaintiff respondent brought a suit against the appel lant for recovery of possession of certain property and for mesne profits.
The plaintiff claimed recovery of possession and mesne profits on the ground that he was the absolute owner of the property described in the plaint and the defendant was in, wrongful possession of the same.
In the plaint the plaintiff made reference to a previous suit that had been filed by him and his mother (C.S. 28 of 1950) wherein a claim had been made against the defendant for the recovery of the mesne profits in regard to the same property for the period ending February 1.0, 1950.
In the previous suit the mense profits had been decreed.
In his written statement in the present suit the defendant appellant raised a technical plea under Order 2 rule 2 of the Civil Procedure Code to the maintainability of the suit.
Before evidence was led by the parties the trial court de cided this preliminary issue raised by the defendant.
The trial court held that the suit was barred under 0.
2 r. 2 of the Code.
On appeal, the Appellate Court held that the plea of a bar under Order 2 rule 2, Civil Procedum Code should not have teen entertained at all because the pleadings in the earlier suit C.S. 28 of 1950 had not been filed in the present case.
Therefore, the Appellate Court set aside the order of the trial Court.
Against this order the defendant preferred an appeal which was dismissed by the High Court.
The appellant obtained special leave against the judgment of the High Court.
Hence the appeal Held:(i) A plea under Order 2 rule 2 of the Code based on the existence of a former pleading cannot be entertained when the pleading on which it rests has not been produced.
It is for this reason that a plea of a bar under 0.
2 r. 2 of the Code can be established only if the defendant files in evidence the pleadings in the previous suit and thereby proves to the court the identity of the cause of action in the two suits.
In other words a plea under 0.
2 r. 2 of the Code cannot be made out except on proof of the plaint in the previous suit the filing of which is said to create the bar.
Without placing before the court the plaint in which those facts were alleged, the defendant cannot invite the court to speculate or infer by a process of deduction what those facts might be with reference to the reliefs which were then claimed.
On the facts of this case it has to be held that the plea of a bar under 0, 2 r. 2 of the Code should not have been entertained at all by 832 the trial Court because the pleadings in civil suit No. 28 of 1950 were not filed by the appellant in support of this plea.
(ii)in order that a plea of a bar under 0. 2 r. 2 (3) of the Code should succeed the defendant who raises the plea must make out (i) that the second suit was in respect of the same cause of action as that on which the previous suit was based; (ii) that in respect of that cause of action the plaintiff was entitled to more that one relief (iii) that being thus entitled to more than one relief plaintiff, without leave obtained from the Court omitted to sue for the relief for which the second suit had been filed.


judgement:
Appeal No. 791 of 1962.
Appeal by special leave from the judgment and order dated March 22, 1960, of the Bombay High Court in Award No. 18 of 1959.
section T. Desai and I. N. Shroff, for the appellant.
B. C. Misra, for the respondent.
April 29, 1964.
The Judgment of the Court was delivered by HIDAYATULLAH J.
This appeal by special leave is directed against an order of the High Court of Bombay dated March 22, 1960 in its ordinary original civil jurisdiction.
The facts are simple.
By a letter dated July 30, 1955, Messrs. Kajaria rraders (India) Ltd., who is the respondent here and Messrs. Foreign Import and Export Association (sole proprietory firm owned by the appellant Jagdish C. Gupta) entered into a partnership to export between January and June 1956, 10,000 tons of manganese ore to Phillips Brothers (India) Ltd., New York.
Each partner was to supply a certain quantity of manganese ore.
We are not concerned with the terms of the agreement but with one of its clauses which provided: "That in case of dispute the matter will be referred for arbitration in accordance with the Indian .
" The company alleged that Jagdish Chander Gupta failed to carry out his part of the partnership agreement.
After some correspondence, the company wrote to Jagdish Chander Gupta on February 28, 1959 that they had appointed Mr. R. J. Kolah (Advocate O.S.) as their arbitrator and asked Jagdish Chander Gupta either to agree to Mr. Kolah 's appointment as sole arbitrator or to appoint his own arbitrator.
Jagdish Chander Gupta put off consideration and on March 17, 1959 the company informed Jagdish Chander Gupta that as he had failed to appoint an arbitrator within 15 clear days they were appointing Mr. Kolah as sole arbitrator.
Jagdish Chander Gupta disputed this and the corn 53 pany filed on March 28, 1959 an application under section 8 (2) of the Indian for the appointment of Mr. Kolah or any other person as arbitrator.
Jagdish Chander Gupta appeared and objected inter alia to the institution of the petition.
Two grounds were urged (i) that section 8(2) of the Indian was not appli cable as it was not expressly provided in the arbitration clause quoted above that the arbitrators were to be by consent of the parties and (ii) that section 69(3) of the afforded a bar to the petition because the partnership was not registered.
The petition was refer red by the Chief Justice to a Divisional Bench consisting of Mr. Justice Mudholkar (as he then was) and Mr. Justice Naik.
The two learned Judges agreed that in the circumstances of the case an application under section 8 of the Indian was competent and that the court had power to appoint an arbitrator.
They disagreed on the second point: Mr. Justice Mudholkar was of the opinion that section 69(3) of the barred the application while Mr. Justice Naik held otherwise, The case was then referred to Mr. Justice K. T. Desai (as he then was) and he agreed with Mr. Justice Naik with the result that the application was held to be competent.
In this appeal it was not contended that the conclusions of the learned Judges in regard to section 8(2) were erroneous.
The decision was challenged only on the ground that section 69(3) was wrongly interpreted and the bar afforded by it was wrongly disallowed.
Section 69 of the may be reproduced here : "69.(1) No suit to enforce a right arising from a contract or conferred by this Act shall be instituted in any Court by or on behalf of any person suing as a partner in a firm against the firm or any person alleged to be or to have been a partner in the firm unless the firm is registered and the person suing is or has been shown in the Register of Firms as a partner in the firm.
54 (2) No suit to enforce a right arising from a contract shall be instituted in any Court by or on behalf of a firm against any third party unless the firm is registered and the persons suing are or have been shown in the Register of Firms as partners in the (3) The provisions of sub sections(1) and (2) shall apply also to a claim ofset off or other proceeding to enforce a rightarising from a contract, but shall not affect (a) the enforcement of any right to sue for the dissolution of a firm or for accounts of a dissolved firm, or any right or power to realise the property of a dissolved firm, or (b) the powers of an official assignee, receiver or Court under the , or the , to realise the property of an insolvent partner.
(4) This section shall not apply (a) to firms or to partners in firms which have no place of business in the territories to which this Act extends, or whose places of business in the said territories are situated in areas to which, by notification under section 56, this Chapter does not apply, or (b) to any suit or claim of set off not exceeding one hundred rupees in value which, in the Presidency towns, is not of a kind specified in section 19 of the , or outside the Presidency towns, is not of a kind specified in the Second Schedule to the Provincial Small Cause Courts Act, 1887, or to any proceeding in execution or other proceeding incidental to or arising from any such suit or claim 'Me section, speaking generally, bars certain suits and pro ceedings as a consequence of non registration of firms.
Sub 55 section (1) prohibits the institution of a suit between partners inter se or between partners and the firm for the purpose of .enforcing a right arising from a contract or conferred by the Partnership Act unless the firm is registered and the person suing is or has been shown in the Register of Firms as a partner in the firm.
Sub section
(2) similarly prohibits a suit by or on behalf of the firm against a third party for the purpose of enforcing rights arising from a contract unless the firm is registered and the person suing is or has been shown in the Register of Firms as a partner in the firm.
In the third sub section a claim of set off which is in the nature of a counter claim is also similarly barred.
Then that subsection bars "other proceedings".
The only doubt that has arisen in this case is regarding the meaning to be given to the expression "other proceeding".
One way to look at the matter is to give these words their full and natural meaning and the other way is to cut down that meaning in the light of the words that precede them.
The next question is whether the application under section 8 (2) of the can be regarded as a proceeding "to enforce a right arising from a contract", and therefore, within the bar of section 69 of the .
Mr. Justice Mudholkar in reaching his conclusion did not interpret the expression "other proceeding" ejusdem generis with the words "a claim of set off".
He held further that the application was to enforce a right arising from the contract of the parties.
Mr. Justice Naik pointed out that the words used were not "any proceeding" nor "any other proceedings" but "other proceeding" and that as these words were juxtaposed with 'a claim of set off ' they indicated a, proceeding of the nature of a claim in defence.
On the second point Mr. Justice Naik held that this was not a proceeding to enforce a right arising from a contract but was a claim for damages and such a claim, could be enter tained because it was based on something which was inde pendent of the contract to supply ore.
He held that the, right which was being enforced was a right arising from the and not from the contract of the parties.
Mr. Justice K. T. Desai agreed with most of these conclu sions and suggeted that the words preceding "other proceed 56 ing", namely, "a claim of set off" had 'demonstrative and limiting effect '.
He seems to have ascertained the meaning of the expression "other proceeding" by reference to the meaning of the words "a claim of set off", which he considered were associated with it.
Ile first question to decide is whether the present pro ceeding is one to enforce a right arising from the contract of the parties.
The proceeding under the eighth section of the has its genesis in the arbitration clause, because without an agreement to refer the matter to arbitration that section cannot possibly be invoked.
Since the arbitration clause is a part of the agreement constituting the partnership it is obvious that the proceeding which is before the court is to enforce a right which arises from a contract.
Whether we view the contract between the parties as ;a whole or view only the clause about arbitration, it is impossible to think that the right to proceed to arbitration is not one of the rights which are founded on the .
agreement of the parties.
The words of section 69(3) "a right arising from a contract" are in either sense sufficient to cover the present matter.
It remains, however, to consider whether by reason of the fact that the words "other proceeding" stand opposed to the words "a claim of set off" any limitation in their eaning was contemplated.
It is on this aspect of the case that the learned Judges have seriously differed.
When in a statute particular classes are mentioned by name and then are followed by general words, the general words are sometimes construed ejusdem generis, i.e. limited to the same category or genus comprehended by the particular wordsbut it is not necessary that this rule must alwavs apply.
The nature of the special words and the general words must e considered before the rule is applied.
In Allen vs Emerson (1), Asquith J. gave interesting examples of particular words followed by general words where the Principle of ejusdem generis might or might not apply.
We ink that the following illustration will clear any difflculty.
In the expression "books, pamphlets, newspapers and other (1) [i944] 1 K.B. 362.
57 documents" private letters may not be held included it 'other documents ' be intepreted ejusdem generis with what goes before.
But in a provision which reads "newspapers or other document likely to convey secrets to the enemy", the, words 'other document ' would include document of any kind and would not take their colour from 'newspapers '.
It follows, therefore, that interpretation ejusdem generis or noscitur a sociis need not always be made when words showiig particular classes are followed by general words.
Before the general words can be so interpreted there must be a genus constituted or a category disclosed with reference to which the general words can and are intended to be restricted.
Here the expression "claim of set off" does not disclose a category or a genus.
Set offs are of two kinds legal and equitable and both are already comprehended and it is difficult to think of any right "arising from a contract" which is of the same nature as a claim of set off and can be raised by a defendant in a suit.
Mr. B. C. Misra, whom we invited to give us examples, admitted frankly that it was impossible for him to think of any proceeding of the nature of a claim of set off other than a claim of set off which could be raised in a suit such as is described in the second sub section.
In respect of the first sub secton he could give only two examples.
They are (i) a claim by a pledger of goods with an unregistered firm whose goods are attached and who has to make an objection under 0.
21 r. 58 of the Code of Civil Procedure and (ii) proving a debt before a liquidator.
The latter is not raised as a defence and cannot belong to the same genus as a "claim of set off".
The former can be made to fit but by a stretch of some considerable imagination.
It is difficult for Lis to accept that the Legislature was thinking of such far fetched things when it spoke of "other proceeding" ejusdem generis with a claim of set off.
Mr. Justice Naik asked the question that if all proceedings were to be excluded why was it not considered suffi cient to speak of proceedings along with suits in sub sections
(1) and (2) instead of framing a separate subsection about proceedings and coupling 'other proceeding, ' with 'a 58 the search for the answer in the ' scheme of the section itself gives the clue.
The section thinks in terms of (a) suits and (b) claims of set off which are in a sense of the nature of suits and (c) of other proceedings.
The section first provides for exclusion of suits in sub sections
(1) and (2).
Then it says that the same ban applies to a claim of set off and other proceeding to enforce a right arising from a contract.
Next it excludes the ban in respect of the right to sue (a) for the dissolution of a firm, (b) for accounts of.
a dissolved firm and (c) for the realisation of the property of a dissolved firm.
The emphasis in each case is on dissolution of the firm.
Then follows a general exclusion of the section.
The fourth sub section says that the section as a whole, is not to apply to firms or to partners and firms which have no place of business in the territories of India or whose places of business are situated in the territories of India but in areas to which Chapter VII is not to apply and to suits or claims of set off not exceeding Rs. 100 in value.
Here there is no insistence on the dissolution of the firm.
It is significant that in the latter part of clause (b) of that section the words are "or to any proceeding in execution or other proceeding incidental to or arising from any such suit or claim" and this clearly shows that the word "proceeding" is not limited to a proceeding in the nature of a suit or a claim of set off.
Subsection (4) combines suits and a claim of set off and then speaks of "any proceeding in execution" and "other proceeding incidental to or arising from any such suit or clainm" as being outside the ban of the main section.
It would hardly have been necessary to be so explicit if the words other proceeding in the main section had a meaning as restricted as is suggested by the respondent.
It is possible that the draftsman wishing to make exceptions of different kinds in respect of suits, claims of set off and other proceedings grouped suits in sub sections
(1) and (2), set off and other proceedings in sub section
(3) made some special exceptions in respect of them in sub section
(3) in respect of dissolved firms and then viewed them all together in sub section
(4) providing for a complete exclusion ' of the section in respect of suits of particular classes.
For convenience of drafting this 59 scheme was probably followed and nothing can be spelled out from the manner in which the section is sub divided.
Some cases noticed by the High Court were cited to us but none of them appears to be really in point.
In Hafiz Qamar Din vs Nur Din( ') and Babutal Dhandhania vs Messrs. Gauttam and Co.( ') proceedings were started on an award, in one to make it a rule of the Court and in the other to get it set aside.
These cases are distinguishable because they deal with awards and it is not necessary to decide whether after an award the proceeding is one to enforce a right arising from a contract.
We do not refer to them.
In Kottamasu Sreemannarayanamuthy and another vs Chakka Arjanadu() a petition for adjudication of a partner as insolvent was held to be a right arising not from, a contract but from statute.
Here the right that is being enforced through the medium of the arises from the contract between the parties and is a part of it.
In Jamal vs Firm Umar Haji Karim (4 ) the bar of section 69(3) was claimed during the execution of a consent decree and was disallowed.
Grille C. J. observed that the expression 'other proceeding ' indicated something which was 'sui generis of a claim of set off '.
If the partners of an unregistered firm.
go to court without either asking for a dissolution of the firm or dissolving it themselves and enter into an agreement and compose their differences it is possible to say that the enforcement of the consent decree is no more than the enforcement of a right arising from a contract and is within the ban.
It is, however, not necessary to decide this point here.
in Ram Lal Harnam Das vs Pal Krishan and others() it was expressly pointed out that the expression 'other proceeding ' in the third sub section applied to proceedings of the nature of a claim of set off and nothing else.
This case cannot be said to interpret the sub section correctly.
Similarly, Mahendra vs Gurdeyal( '), which lays down that section 69 does not bar a partner of an unregistered partnership firm from applying to the court under section 8 of the for referring the dispute (1) A.T.R (3) A.I.R. 1939 Mad.
(5) A.I.R. 1917 Punjab 159.
(2) A.r.
R. (4) I.L.R. (6) I.L.R. 30 Pat.
109. 60 between partners to arbitrator as provided in the condition of their agreement, cannot be accepted as sound.
The ,reason given by the Divisional Bench that as section 69 allows dissolution and accounts of unregistered partnership it cannot bar such an application appears to us to be not quite in Point.
In our judgment, the words 'other proceeding ' in sub section (3) must receive their full meaning untramelled by the words 'a claim of set off '.
The latter words neither intend nor can be construed to cut down the generality of the words 'other proceeding '.
The sub section provides for the application of the provisions of sub sections
(1) and (2) to claims of set off and also to other proceedings of any Kind which can properly be said to be for enforcement of any right arising from contract except those expressly mentioned as exceptions in sub section
(3) and sub section
The appeal is, therefore, allowed.
The decision of the High Court will be set aside and the application under section 8(2) of the shall stand dismissed with costs throughout on the applicant in the High Court.

dataset_name: IN-Abs

summary:
The respondent entered into a partnership agreement with the appellant.
But this was not registered.
There was an arbitration clause sti 51 pulating that in case of dispute the matter will be referred for arbitration in accordance with .
Dispute having arisen between the respondent and the appellant the former wrote to the latter stating that the dispute be referred for arbitration and that the respondent has appointed one K as the sole arbitrator.
On the failure of the appellant to agree to this the respondent filed an application under section 8(2) of the Indian for the appointment of arbitrator.
The application was heard by a Division Bench of the High Court before which the appellant contended that section 69(3) of the afforded a bar to the petition because the partnership was not registered.
One of the Judges upheld the contention while the other rejected it and the matter was referred to another Judge who held that the application was competent.
The present appeal was filed by special leave granted by this Court.
HELD: (i) Thai since the arbitration clause formed a part of the agreement constituting the partnership it is obvious that the proceeding which is before the Court is to enforce a right which arises from a contract.
Whether one views the contract between the parties as a whole or one views only the arbitration clause it is impossible to think that the right to proceed to arbitration is not one of the rights which are founded on the agreement of the parties.
The words of section 69(3) "a right arising from a contract" are in either sense sufficient to cover the present matters.
(ii) Interpretation ejusdem genuris or noscitur a sociis need not always be made when showing particular classes are followed try general words.
Before the general words can be so interpreted there must be a genus constituted or a category disclosed with reference to which the general words can and are intended to be restricted.
The expression "claim of set off" does not disclose a category or a genus.
Set offs are of two kinds legal and equitable and both are already comprehended and it is difficult to think of any right "arising from a contract ' which is of the same nature as a claim of set off and can be raised by a dependent in suit.
Allen vs Emerson, , referred to.
Hafiz Qamar Din vs Nur Din, A.I.R. 1936 Lah.
136, Babulal Dhan Dhania vs M/s. Gautam & Co. A.I.R. 1950 Cal.
341, Kottamasu sreemannarayanmurthy vs Chokka Arjanadtu, A.I.R. , Jamal vs Firm Umar Haji Karim, I.L.R. , and Ram Lal Harnam Das Y. Bal Kishan, A.I.R. 1957 Punj. 159, distinguished.
(iii) The words "other proceeding" in sub section (3) must receive their full meaning untramelled by the words "a claim of set off.
The latter words neither intend nor can be construed to cut down the generality of the words "other proceeding".
The sub section provides for the application of the provisions of sub sections (1) and (2) to claims of set off and also to other proceedings of any kind which can properly be said to be for enforcement of any right arising from contract except those expressly mentioned as exceptions in subsections (3) and (4).


judgement:
l Appeal No. 897 of 1963.
Appeal from the judgment and order dated October 4, 1962 of the Kerala High Court, Ernakulam, in Writ Appeal No. 17 of 1962.
188 A.V. Viswanatha Sastri, Arun B. Saharaya and Sardar Bahadur, for the appellant.
V.P. Gopalan Nambiar, Advocate General for the State Kerala and V.A. Seyid Muhammad, for the respondent.
The Judgment of the Court was delivered by Bachswat, J.
The short question in this appeal is whether the proposed acquisition of the electrical supply undertaking of the appellant by the State of Kerala in pursuance of the notice exhibit G, dated November 20, 1959 is authorised by section 6 of the .
The appellant is the holder of a license for the supply of electrical energy in Ernakulam and other places in Cochin.
The license was originally granted to the managing agents of the appellant under the Cochin Electricity Regulation III of 1902 then in force in Cochin and subsequently assigned to the appellant with the permission of the Cochin Government.
On the merger of Travancore Cochin with the Union of India, the was made applicable by the Part B States Laws Act, 1951 (Act III of 1951) to the Travancore Cochin area, and the Cochin Electricity Regulation stood repealed.
The (Act 54 of 1948) was also made applicable to the Travancore Cochin area by the Part B States Laws Act, 1951.
On March 31, 1957 the Kerala Electricity Board was constituted, and by s.71 of Act 54 of 1948, any right and option to purchase the undertaking of the licensee under the was transferred to and vested in the Board.
Now, the right or option to purchase the undertaking of a licensee under s.7(1) of the then in force was exercisable "on the expiration of such period, not exceeding fifty years, and of every such subsequent period, not exceeding twenty years as shall be specified in this behalf in the license.
" Sub section (4) of s.7 provided: "Not less than two years ' notice in writing of any election to purchase under this section shall be served upon the licensee by the local authority or the State Government, as the case may be." Clause 15(a) of the license held by the appellant provides: "The option of purchase given by Section 7, sub section (i) of the Regulation shall first be exercisable on the expiration of 25 years from the commencement of this license and on the expiration of every subsequent period of ten years during the continuance of this license." Section 7(1) of the corresponds to section 7(i) of the Regulation, that is to say, of the Cochin Electricity.
Regulation.
The date of the commencement of the license is December 3, 1935.
The period of 25 years mentioned in el.
15(a) of the license expired on December 2, 1930.
The last date for giving the two years notice of the election to purchase on, the try of ' December 2, 1960 required under section 7(4) of the Indian e electricity Act, 1910 expired on December 2. 1958.
On February 11, 1959, the State Electricity Board served on the appellant a notice, exhibit B, of its election to purchase the undertaking of, the appellant on the expiry of December 2, 1960, but this notice was not being in accordance with section 7,(4) was of no legal effect.
By the Indian Electricity (Amendment) Act, 1959 (Act 32 1959), s.6 now in force was substituted for the old s.7 of the , with effect from September 5, 1959.
Section 6 of the now in force reads: "6.
(1) Where a license has been granted to any person not being a local authority, the State Electricity Board shall, (a) in 'the case of a license granted ' before the commencement of the Indian Electricity (Amendment) Act, 1959, on the expiration of each such period as is specified in the license; and (b) in the case of a. license granted on or after the commencement of the said Act, on the expiration of such period not exceeding twenty years and of every such subsequent period, not exceeding ten years, as shall be specified in this behalf in the license; have the option of purchasing the undertaking and such opt:on shall be exercised by the State Electricity Board serving upon the license a notice in writing of not less than one year requiring the licensee to sell the undertaking to it at the expiry of the relevant period referred to in this sub section.
(2) Where a State Electricity Board has not been constituted, or if constituted, does not elect to purchase the undertaking, the State Government shall have the like option to be exercised in the like manner of purchasing the undertaking.
(3)Where neither the State Electricity Board nor the Government elects to purchase the undertaking, any authority constituted for an area within which the area of supply is included shall have the like option to be exercised in the like manner of purchasing the undertaking.
(4) If the State Electricity Board intends to exercise the option of purchasing the undertaking under this it shall send an intimation in writing of such intention to the State Government at least eighteen months before the expiry of the relevant period referred to in subsection (1) and if no such intimation as aforesaid is receiv 190 ed by the State Government the State Electricity Board shall be deemed to have.
elected not to purchase the undertaking.
(5) If the State GoVernment intends to exercise the option of purchasing the undertaking under this section.
shall send an intimation in writing of such intention to the local authority, if any, referred to in sub section (3) at least fifteen months before the expiry of the relevant period referred to in sub section (1) and if no such intimation as aforesaid is received by the local authority.
the State Government shall be deemed to have elected not to purchase the undertaking.
(6) Where a notice exercising the option of purchasing the undertaking has been served upon the licensee under this sect:on, the licensee shall deliver the undertaking to the State Electricity Board, the State Government or the local authority, as the case may be, on the expiration of the relevant period referred to in sub section (1) pending the determination and payment of the purchase price.
(7) Where an undertaking is purchased under this section, the purchaser shall pay to the licensee the purchase price determined in accordance with the provisions of sub section (4) of section 7A." On October 24, 1959, the State Electricity Board served upon the appellant a notice exhibit D, of its election to purchase the undertaking on the expiry of December 2, 1960.
On October 29, 1959, the State Electricity Board served upon the appellant another notice, exhibit E, of its election.
On November 20, 1959, the State Government served upon the appellant a notice, exhibit G, of its election to purchase the undertaking on the expiry of December 2. 1960.
On November 14, 1960, the appellant filed a writ petition in the High Court of Kerala impleading the State of Kerala and the Kerala State Electricity Board and asking for the issue of appropriate writs and orders restraining them from taking any action pursuant to the notices.
B,D,E and G.
On December 20.
1961, a learned single Judge of the High Court passed the following order : "In view of the representation made before me by both the learned Advocate General appearing for the State, the I st respondent, and Mr. Krishnaswami lIyengar, learned counsel appearing for the Kerala State Electricity Board.
the second respondent.
that for the purpose of this writ petition.
the notices issued by the Kerala State Electricity Board, Exs.
B. D and E can be ignored, it follows that neither the 1st respondent nor the 2nd respondent has any jurisdiction or power to take any action on the basis Exs.
B. D or E.
In view of the fact that I am uphold 191 ing the action of the State Government, who had issued the notice exhibit G, it follows that the 1st respondent alone is entitled to take further action under the Act.
in pursuance of the notice, exhibit G, issued and sent along with the covering letter, exhibit F on 20 1 1 1959.
It follows, subject to what is stated about Exs.
B, D and E, that the writ petition has to be dismissed.
There will be no order as to costs.
" The effect of this order was that the State Electricity Board waived and abandoned all its rights of purchase of the undertaking under the notices, Exs.
B, D and E, and neither the Kerala State Electricity Board nor the State of Kerala had any jurisdiction or power to take any action on the basis of those notices, and save as aforesaid, the writ petition was dismissed, and it was held that State Government was entitled to take further action under its notice, exhibit G. Aggrieved by this order, the appellant filed an peal in the Kerala High Court impleading the State Government only as the party respondent.
The State Electricity Board did not file any appeal from the order of the learned single Judge.
By its judgment dated October 4, 1962, a Division Bench of the High Court dismissed the appeal.
In paragraph 15 of its judgment, Bench observed: "In its petition the appellant asked for reliefs both against the State Government and the State Electricity Board.
However, in the course of the hearing of the petition, the Board gave up its claims under Exts.
B. D and E, and only the claim of the State Government under Ext.
G was canvassed.
The petition was, in effect, allowed: against the Board.
The Baord has not appealed and is not a party to the present appeal; and its notices may therefore be ignored except to the extent that they may affect the rights of the State Government.
" The appellant now appeals to this Court under a certificate granted by the High Court under articles 133(1)(a) and 133(1)(c) of the Constitution.
On half of the appellant, Mr. Vishwanath Sastry contended that (1) as the two years ' notice in writing of.
the election to purchase the undertaking on the expiry of December, 2, 1960 was not served on the appellant as required by the old section 7(4) of the . 1910.
the appellant acquired a vested right to hold the license until the expiry of a further period of ten years.that is to say, until December, 2, 1970.
and this vested right was not taken away either expressly or by necessary implication by the new s.6 of the introduced by the amending Act 32 of 1958; (2) the expression "on the expiration of each such period as is specified in the license" in the new s.6(1)(a) means a period which has not expired and on the expiry of which the option may be legally exercised.
and since in the absence of the two years ' notice required under the old s.7(4), the option of purchase on the expiry of December 2, 1960 could not be legally 192 exercised, the new s.6(1) did not confer any option of purchase on the expiry of December 2, 1960 and the first option exercisable under the new s.6(1) would be on the expiry of December 2, 1970; (3) sub sections (4) and (5) of the new s.6 show that the period on the expiry of which the option under sub s(1)of s.6 is exercisable, is a period which would expire at least 18 months after the coming into force of the new s.6, that is to say, after September 5, 1959, and since the period expiring on December 2, 1960 is not such a period, the new s.6(1) did not confer any option of purchase on the expiry of December 2, 1960; and (4) in any event, the State Electricity Board having duly elected to purchase the undertaking on the expiry of December 2, 1960, the State Government acquired no option of purchase under sub s(2) of s.7 of the .
On behalf of the respondent.
Mr. V.P. Gopalan Nambiar, the Advocate General of Kerala, contended (1) that the absence of two years ' notice under the old s.7(4) of the did not confer upon the appellant a vested right to hold the license until the expiry of December 2, 1970, and the immunity from compulsory purchase under the old s.7 arising from the non service of the requisite two years ' notice could be, and, in fact, was taken away by the new s.6, which required only one year 's notice of intention to purchase the undertaking; (2) assuming that the appellant acquired under the old s.7 a vested right to hold .the license until December 2, 1970, such vested right was taken away by the new s.6, which expressly applies to licenses granted before its commencement, and the period of 25 years is a period specified in as the license on the expiry of which the option of purchase was legally exercisable; (3) sub sections (4) and (5) of the new s.6 did not cut down the plain meaning of sub s(1) of the section and the option on the expiry of the period of 25 years was vested 'under sub s(1) of s.6, though this period did not expire 18 months after September 5. 1959; and (4) as the State Electricity Board did not send to the State Government any intimation in 'writing 'of ' its intention to exercise the option on the expiry of December 2, 1960 as required by sub s(4) of s.6, the Board must be deemed to have elected not to exercise this option, and consequently by sub S(2) of s.6.
the State Government is vested with the option We think that the fourth contention of Mr. Viswanatha Sastry is sound, and should be accepted.
Assuming, without deciding, that the option of purchasing the undertaking on the expiry of the period of 25 years specified in the license was available under sub s(1) of s.6, such option vested in the State Electricity Board, and as the Board duly elected to purchase the undertaking, the State Government acquired no right or option of purchasing the undertaking under s.6.
On this ground alone, the appeal should be allowed, and in this view of the matter, we do not think it necessary to express any opinion on the other contentions urged 193 before us.
As far as the State Electricity Board is concerned,.
it has abandoned and waived its option of purchase on the expiry of 25 years.
Sub section (1) of s.6 expressly vests in the State Electricity Board the option of purchase on the expiry of the relevant period specified in the license.
But the State Government claims that under sub s(2) of s.6 it is now vested with the option.
Now, under sub s(2) of s.6, the State Government would be vested with the option only "where a State Electricity Board has not been constituted, or if constituted, does not elect to purchase the undertaking.
" It is common case that the State Electricity Board was duly constituted.
But the State Government claims that the State Electricity Board did not elect to purchase the undertaking.
For this purpose, the State Government relies upon the deeming provisions of sub s(4) of s.6, and contends that as the Board did not send to the State Government any intimation in writing of its intention to exercise the option as required by the sub section, the Board must be deemed to have elected not to purchase the undertaking.
Now, the effect of sub s(4) read with sub s(2) of s.6 is that on failure of the Board to give the notice prescribed by sub s(4), the option vested in the Board under sub s(1) of s.6 was liable to be divested.
Sub section (4) of s.6 imposed upon the Board the duty of giving after the coming into force of s.6 a notice in writing of its intention to exercise the option at least 18 months before the expiry of the relevant period.
Section 6 came into force on September 5, 1959, and the relevant period expired on December 3. 1960.
In the circumstances, the giving of the requisite notice of 18 months in respect of the option of purchase on the expiry of December 2, 1960, was impossible from the very commencement of s.6.
The performance of this impossible duty must be excused in accordance with the maxim, lex non cogitate ad impossible (the law does not compel the doing of impossibilities), and sub s(4) of s.6 must be construed as not being applicable to a case where compliance with it is impossible.
We must therefore, hold that the State Electricity Board was not required to give the notice under sub s(4) of s.6 in respect of its option of purchase on the expiry of 25 years.
It must follow that the Board cannot be deemed to have elected not to purchase the undertaking under sub s(4) of s.6.
By the notice served upon the appellant, the Board duly elected to purchase the undertaking on the expiry of 25 years.
Consequently, the State Government never became vested with the option of purchasing the undertaking under sub s(2) of s.6.
The State Government must, therefore, be restrained from taking further action under its notice, exhibit G, dated November 20, 1959.
In the result, the appeal is allowed, and the respondent State of Kerala is restrained from taking any action under the notice, exhibit G, dated November 20, 1959.
The respondent shall pay to the appellant the costs in this Court.
We direct the parties to pay and bear their own costs in the Courts below.
Appeal allowed.

summary:
The appellant held a licence for the supply of electrical energy in Kerala which was granted for a period of 25 years, and was subject to continuation for ten year terms in the absence of a notice by the local authority or State Government of an election to purchase the undertaking.
The first 25 year term of the licence expired on December 2, 1960, and prior to that, on October 24 and again on October 29, 1959, the State Electricity Board gave notice to the appellant under s.6(1) of the , to purchase the under taking on the expiry of the licence.
On November 20, 1959,the State Government also served notice on the appellant of its election to purchase the undertaking on December 2, 1960.
In November 1960, the appellant filed a writ petition in the High Court seeking orders restraining the State Electricity Board and the respondent State Government from taking any action pursuant to the notices given by them.
In the course of the hearing the petition the State Electricity Board waived and abandoned all its rights of purchase of the Undertaking.
The writ petition thereafter dismissed and it was held that the State Government was entitled to take further steps under its notice dated November 20, 1959.
An appeal against this decision to a Division Bench of the High Court was dismissed.
In the appeal to the Supreme Court, the appellant contended,inter alia, that the State Electricity Board having duly elected under 6(1) to purchase the undertaking on the expiry.
of the licence, the State Government acquired no option of purchase under section 6(2) the 1910 Act.
HELD: Any option of purchasing the undertaking on the expiry of the period of 25 years specified in the licence under section 6(1) vested in the State Electricity Board, and as the Board duly elected to purchase the undertaking by the notice served on the appellants, the State Government acquired no right or option of purchasing the undertaking under section 6.
[193 G H] As section 6 came into force less than eighteen months before December 2, 1960, it was impossible for the Board to have given notice to the State Government as required by section 6(4) of its intention to exercise the option.
On the principle of lex non cogit ad impossibil must therefore ' be construed as not being applicable in the that the Board could not be deemed circumstances of the case, so elected not to purchase the undertaking under section 6(4).[193 E F]


judgement:
vil Appeals Nos. 568 and 757 of 1953.
Appeals from the judgment and order dated October 10, 1960.
of the Madhya Pradesh High Court, Indore Bench, Indore, in Civil Miscellaneous Appeals Nos. 33 of 1958 and 81 and 82 of 1957.
G.S. Pathak, B. Dutta, 1.
B. Dadachanji, O.C. Mathur and Ravinder Narain, for the appellant.
B.R.L. lyengar, S.K. Mehta and K.L. Mehta, for the respondent.
The Judgment of the Court was delivered by Bachawat, J.
The appellant is the Ruler of the former Indian State of Jaora.
He had money dealings with the respondent.
By an agreement dated February 23, 1957.
the appellant and the respondent agreed to refer their disputes regarding those dealings to the arbitration of Lala Durgashankar.
On the same date, the arbitrator made an award.
By this award, the arbitrator found that a sum of Rs. 1,60,000 was due to the respondent from the appellant, and .directed that this sum would be payable in eight quarterly installments, the first four installments to be of Rs. 21,000 each and the next four instalments to be of Rs. 19,000 each, the amount of interest would be payable in another quarterly instalment, the respondent would have a first charge on the sums receivable by the appellant from the Government of India as privy purse, and would be entitled to realise those sums under a letter of authority issued by the appellant, and if the Government would raise any objection to the payment, the respondent would have the right to realise the dues from the personal property of the appellant.
Some the items of the loans in respect of which the award was made were secured on lands and ornaments.
The award therefore provided: "The documents relating to debts obtained on lands and ornaments shall remain as before till the payment of the debts and they shall also remain as securities till then, and the Nawab Sahab shall have no right to transfer the land.
" The award was signed by the arbitrator and also by the appellant and the respondent.
203 On the same day, the arbitrator filed the award in the Court of the District Judge, Ratlam.
Notice of filing of the award under section 14 of the Indian was duly served on the parties.
On March 9, 1957, an agent of the appellant filed a written submission accepting the award and requesting the Court to pass a decree in terms of the award.
But on the same day, an application was made by another agent of the appellant intimating that steps would be taken for setting aside the award.
The Court fixed March 23, 1957 for firing the objection.
The time was subsequently extended up to April 2, 1957.
On that day, an application was filed on behalf of the appellant praying for setting aside the award.
But on April 5, 1957, an application was filed on behalf of the appellant withdrawing the objections and asking the Court to pass a decree in terms of the award, subject to the modification that the amount of the award would be payable in quarterly instalments of Rs. 13,000 each.
This application was signed by the respondent in token of his consent to the modification of the amount of the instalments.
On April 30, 1957.
the arbitrator filed the relevant papers.
On the same day, an agent of the appellant filed an application praying for setting aside the compromise and the award.
The case was fixed for hearing on June 19. 1957.
On that date.
the Court received by registered post an application from the appellant withdrawing the objections and praying for an order in accordance with the compromise application filed on April 5. 1957.
In the circumstances, on June 19. 1957, the Court recorded the compromise and passed a decree in terms of the award as modified by the compromise.
The appellant filed in the Madhya Pradesh High Court Appeal No. 81 of 1957 under section 39 of the Indian against the order dated June 19. 1957 treating it as an order refusing to set aside the award.
The appellant also filed Appeal No. 82 of 1957 under 0.43(1)(m) of the Code of Civil Procedure against the order dated June 19, 1957 recording the compromise.
In the meantime.
the respondent started Execution Case No. 5 of 1957.
and on September 9. 1957 obtained an ex parte order for transfer of the decree to the Court of the District Judge.
Delhi.
On November 1.1957.
the Central Government gave a certificate under s 86(3) read with section 8713 of the Code of Civil Procedure.
1908 cpnsenting to the execution of the decree against the properties of the appellant.
On November 8, 1957.
the District Judge.
Delhi passed a prohibitory order under O. 21.
r. 46 of the Code of Civil Procedure in respect of sums payable to the appellant on account of the privy purse.
By letter dated December 26.
1957, the Central Government informed the appellant of the prohibitory order.
On January 8, 1958, the appellant applied to the Court of the District Judge.
Ratlam praying for vacating the order of transfer of the decree and for cancellation of the certificate issued under O. 21.
r. 6(b) of the Code of Civil Procedure.
By order dated March 15, 1958.
the Court recalled the decree and cancelled the certificate as prayed for.
on the ground that the amount receivable by the appel 204 lant on account of his privy purse was not attachable.
The respondent preferred Appeal No. 33 of 1958 before the High Court against order.
By another order dated January 7, 1959, the District Judge, Ratlam dismissed certain objections of the appellant filed in Execution Case No. 2 of 1958.
We are informed that the appellant flied before the High Court Appeal No. 13 of 1959 from this order.
Appeals Nos. 81 and 82 of 1957, 33 of 1958 and 13 of 1959 were heard and disposed of by the High Court by a common judgment on October 10, 1960.
The High Court dismissed Appeals Nos. 81 and 82 of 1957 and 13 of 1959 preferred by the appellant and allowed Appeal No. 33 of 1958 preferred by the respondent.
The appellant has referred to this Court Civil Appeal No. 568 of 1963 against the order of the High Court passed in Appeal No. 33 of 1958.
He has also preferred Civil Appeal No. 767 of 1963 from the order of the High Court passed in Appeals Nos. 81 and 82 of 1957.
Civil Appeals Nos. 568 and 767 of 1963 were heard together, and are being disposed of by this common judgment.
On behalf of the appellant, Mr. Pathak raised three contentions only.
He argued that: (1) the award affected immovable property of the value of more than Rs. 100, and as it was not registered, no decree could be passed in terms of the award; (2)the proceedings under section 14 of the Indian were incompetent in the absence of the consent of the Central Government under section 86(1) read with section 87B, Code of Civil Procedure, and the decree passed in those proceedings is without jurisdiction and null and void; and (3) the amount receivable by the appellant from the Central Government as his privy purse is a political pension within the meaning of section 60(1)(g), Code of Civil Procedure, and is not liable to attachment or sale in execution of the .decree.
These contentions are disputed by Mr. Iyengar on behalf of the respondent.
The first two contentions of Mr. Pathak arise in Civil Appeal No. 767 of 1963 and the third contention arises in Civil Appeal No. 568 of 1963.
The first contention raised by Mr. Pathak must be rejected.
The award stated that the existing documents relating to.
debts obtained on lands would remain as before, and they would remain as securities till payment of the debts and the appellant would have no right to transfer the land.
This portion of the award stated an existing fact.
It did not create, or of its own force declare any interest in any immovable property.
Consequently, the document did not come within the purview of section 17 of the Indian , and was not required to be registered.
The second contention of Mr. Pathak raises questions of construction of sections 86 and 87B of the Code of Civil Procedure.
By reason of section 86(1) read with section 87B, no Ruler of any former Indian State "may be sued in any Court otherwise competent to try the suit except with the consent of the Central Government.
" Section 205 86(2) provides that the requisite consent may be given with respect to a specified suit or with respect to several specified suits or with respect to all suits of any specified class or classes, Section 86 plainly deals with a special class of suits, and this conclusion is reinforced by the heading of Part IV, "Suit in Particular Cases", in which sections 86 and 87B appear.
Order 4, rule 1, Code of Civil Procedure provides that every suit shall be instituted by presenting a plaint to the Court or such other officer as it appoints in this behalf.
In the context of section 176 of the Government of India Act, 1935, Mahajan and Mukherjea, observed that the expression "sue" means the "enforcement of a claim or civil right by means of legal proceedings", see Province Bombay v .K.S. Advani and others(1).
But in the context of the Indian Limitation Act, 1908, Lord Russell of Killowen observed in Hansraj Gupta vs Official Liquidator, Dehra Dun Mussorrie Electric Tramway Co.(2): "The word 'suit ' ordinarily means, and apart from some context must be taken to mean, a civil proceeding instituted by the presentation of a plaint." And construing section 86 of the Code of Civil Procedure, Shah, J. speaking on behalf of this Court observed in Bhagwat Singh vs State Rajasthan(3): "The appellant is recognised under article 366(22) of the Constitution as a Ruler of an Indian State, but section 86 in terms protects a Ruler from being 'sued ' and not against the institution of any other proceeding which is not in the nature of a suit.
A proceeding which does not commence with a plaint or petition in the nature of plaint, or where the claim is not in respect of dispute ordinarily triable in a Civil Court, would prima facie not be regarded as falling within section 86, Code of Civil Procedure.
" Now, a proceeding under section 14 read with section 17 of the Indian for the passing of a judgment and decree on an award does not commence with a plaint or a petition in the nature of a plaint, and cannot be regarded as a suit and the parties to whom the notice of the filing of the award is given under section 14(2) cannot be regarded as "sued in any Court otherwise competent to try the suit", within the meaning of section 86(1) read with section 87B, Code of Civil Procedure.
Accordingly, the institution of this proceeding against the Ruler of a former Indian State is not barred by section 86(1) read with section 87B. Section 141, Code of Civil Procedure does not attract the provisions of section 86(1) read with section 87B to the proceedings under section 14 of the Indian .
Section 86(1) read with section 87B confers upon the Rulers of former Indian States substantive rights of im (1)[1950] S.C.R. 621, at pp.
661, (2)[1932] L.R. I.A.13,19.
(3) ; at pp.
445, 446.
206 munity from suits.
Section 141 makes applicable to other proceedings only those provisions of the Code which deal with procedure and not those which deal with substantive rights.
Nor does section 41(a) of the Indian carry the matter any further.
By that section, the provisions of the Code of Civil Procedure, 1908 are made applicable to all proceedings before the Court under the Act.
Now, by its own language section 86(1) applies to suits only, and section 141, Code of Civil Procedure does not attract the provisions of section 86(1) to proceedings other than suits.
Accordingly, by the conjoint application of section 41(a)of the Indian and sections 86(1) and 141 of the Code of Civil Procedure, the provisions of section 86(1) are not attracted to a proceeding under section 14 of the Indian .
It follows that the Court was competent to entertain the proceedings under section 14 of the Indian and to pass a decree against the appellant in those proceedings, though no consent to the institution of those proceedings had been given by the Central Government.
A sovereign foreign State and a Ruler of such State may enjoy a wider immunity from legal proceedings other than suits under the rules of International Law recognised by our Courts, but the appellant is not now a Ruler of a sovereign State, and cannot claim immunity from proceedings other than suits.
The second contention of Mr. Pathak must, therefore, be rejected.
The third contention of Mr. Pathak raises the question whether an amount payable to a Ruler of a former Indian State as privy purse is a political pension within the meaning of section 60(1)(g), Code of Civil Procedure.
The word "pension" in section 60(1)(g), Code of Civil Procedure implies periodical payments of money by the Government to the pensioner.
See Nawab Bahadur of Murshidabad vs Karnani ,Industrial Bank Ltd.(1) And in Bishambhar Nath vs Nawab Imdad Ali Khan(2), Lord Watson observed: "A pension which the Government of India has given a guarantee that it will pay, by a treaty obligation contracted with another sovereign power, appears to their Lordships to be, in the strictest sense, a political pension.
The obligation to pay, as well as the actual payment of the pension, must, in such circumstances, be ascribed to reasons of State policy.
" Now, the history of the integration and the ultimate absorption of the Indian States and of the guarantee for payment of periodical sums as privy purse to the Rulers of the former Indian States are well known.
Formerly Indian States were semi sovereign vassal States under the suzerainty of the British Crown.
With the declaration of Independence, the paramountly of the British Crown lapsed as from August 15, 1947, and the Rulers of Indian States 207 became politically independent sovereigns.
The Indian States parted with their sovereignty in successive stages, firstly on accession to the, Dominion of India, secondly on integration of the States into sizable administrative units and on closer accession to the Dominion of India, and finally on adoption of the Constitution of India and extinction of the separate existence of the States and Unions of States.
During the second phase of this political absorption of the States, the Rulers of the Madhya Bharat States including the Ruler of Jaora State entered into a Covenant on April 22, 1948 for the formation of the United State of Gwalior, Indore and Malwa (Madhya Bharat).
By article II of the Covenant, the Covenanting States agreed to unite and integrate their territories into one State.
Article VI provided that the Ruler of each Covenanting State shall not later than July 1, 1948 make over the administration of the State to the Rajpramukh and thereupon all rights, authority and jurisdiction belonging to the Ruler and appertaining or incidental to the Government of the State would vest in the United .
State of Madhya Bharat.
Article XI(1) provided that "the Ruler of each Covenanting State shall be entitled to receive annually from the revenues of the United State for his privy purse the amount specified against that Covenanting State in Schedule I." In Sch.
I, a sum of Rs. 1,75,000 was specified against the State of Jaora.
Article XI(2) provided that the amount of the privy purse was intended to cover all the expenses of the Ruler and his family including expenses of the residence, marriage and other ceremonies and neither be increased nor reduced for any reason whatsoever.
Article XI(3) provided that the Rajpramukh would cause the amount to be paid to the Ruler in four equal instalments at the beginning of each quarter in advance.
Article XI(4) provided that the amount would be free of alI taxes whether imposed by the Government of the United State or by the Government of India.
Article XIII of the Covenant secured to the Ruler of each Covenanting State all personal privileges, dignities and titles then enjoyed by them.
Article XIV guaranteed the succession, according to law and custom, to the gadding of each Covenanting State and to the personal rights, privileges, dignities and titles of the Ruler.
The Covenant was signed by all the Rulers of the Covenanting States.
At the foot of the Covenant, it was stated that "The Government of India hereby concur in the above Covenant and guarantee all its provisions." In confirmation of this consent and guarantee, the Covenant was signed by a Secretary to the Government of India.
On the coming into force of the Constitution of India, the territories of Madhya Bharat became an integral part of India.
Article 291 of the Constitution provided: "Where under any covenant or agreement entered into by the Ruler of any Indian State before the commencement of this Constitution, the payment of any sums, free 208 of tax, has been guaranteed or assured by the Government of the Dominion of India to any Ruler of such State as privy purse: (a) such sums shall be charged on, and paid out of, the Consolidated Fund of India; and (b) the sums so paid to any Ruler shall be exempt from all taxes on income." In view of the guarantee by the Government of the Dominion of India to the Ruler of Jaora State in the Covenant for the formation of the United State of Madhya Bharat, the payment of the sums specified in the covenant as privy purse to the Ruler became charged on the Consolidated Fund of India, and became payable to him free from all taxes on income.
Article 362 provides that in the exercise of the legislative and executive powers, due regard shall be had to the guarantee given in any such covenant as is referred to in article 291 with respect to the personal rights, privileges and dignities of the Ruler of an Indian State.
Article 363(1) provides, that notwithstanding anything contained in the Constitution, the Courts would have no jurisdiction in any dispute arising, out of any provision in any covenant entered into by any Ruler of an Indian State to which the Government of the 'Dominion of India was a party, or in any dispute in respect of any right accruing under or any liability or obligation arising out of any of the provisions of the Constitution relating to any such covenant.
Article 366(22) provides that the expression "Ruler" in relation to an Indian State means a person by whom the covenant referred to in article 299(1) was entered into and who for the time being is recognised by the President as the Ruler of the State, and includes any person who for the time being is recognised by the President as the successor of such Ruler.
Now, the Covenant entered into by the Rulers of Madhya Bharat States was a treaty entered into by the Rulers of independent States by which they gave up their sovereignty over their respective territories and vested it in the new United State of Madhya Bharat.
The Covenant was an act of State, and any violation of its terms cannot form the subject of any action in any municipal courts.
The guarantee given by the Government of India was in the nature of a treaty obligation contracted with the sovereign Rulers of Indian States and cannot be enforced by action in municipal courts.
Its sanction is political and not legal.
On the coming into force of the Constitution of India, the guarantee for the payment of periodical sums as privy purse is continued by article 291 of the Constitution, but its essential political character is preserved by article 363 of the Constitution, and the obligation under this guarantee cannot be enforced in any municipal court.
Moreover, if the President refuses to recognise the person by whom the covenant was entered into as the Ruler of the State, he would not be entitled to the amount payable as privy purse under article 291.
209 Now, the periodical payment of money by the Government to a Ruler of a former Indian State as privy purse on political considerations and under political sanctions and not under a right legally enforceable in any municipal court is strictly a political pension within the meaning of section 60(1)(g) of the Code of Civil Procedure.
The use of the expression "privy purse" instead of the expression "pension" is due to historical reasons.
The privy purse satisfies all the essential characteristics of a political pension, and as such, is protected from execution under section 60(1)(g), Code of Civil Procedure.
Moreover, an amount of the privy purse receivable from the Government cannot be said to be a debt or other property over which or the proceeds of which he has disposing power within the main part of section 60(1),Code of Civil Procedure.
It follows that the third contention of Mr. Pathak must be accepted, and it must be held that the amounts of the privy purse are not liable to attachment or sale in execution of the respondent 's decree.
The third contention is raised in Civil Appeal No. 568 of 1963 arising out of Appeal No. 33 of 1958.
It follows that Civil Appeal No. 568 of 1963 must be allowed.
All the contentions raised in Civil Appeal No. 767 of 1963 arising from Appeals Nos. 81 and 82 of 1957 fail, and accordingly this appeal must be dismissed.
In the result, Civil Appeal No. 568 of 1963 is allowed, the order of the High Court in Appeal No. 33 of 1958 is set aside and the order of the District Judge dated March 15, 1958 is restored with costs in this Court only.
Civil Appeal No. 767 of 1963 is dismissed with costs.
Appeal 568 of 1963 allowed.
Appeal 767 of 1963 dismissed.

summary:
The appellant, who was a Ruler of a former Indian State, had money dealings with the respondent.
They referred their disputes to an arbitrator who made his award directing the appellant to pay.
a certain sum of money, in installments.
The award also stated that the existing documents relating to debts on lands would remain as before and would remain as securities till the payment of debts The arbitrator filed the award into court and the court, after notice to the parties passed a decree in terms of a compromise modifying the award.
The respondent started execution proceedings and the court passed a prohibitory order under O.XXI, r. 46 of the Civil Procedure Code, 1908, in respect of the sums payable to the appellant by the Central Government on account of the privy purse; but on the application of the appellant, that order was vacated.
The appellant and respondent filed appeals in the High COurt, against the various orders, and the High Court decided all the appeals against the appellant.
In the appeal to the Supreme Court, it was contended that, (i) as the award affected immovable property of the value of more than Rs. 100, and was not registered, a decree could not be passed in terms the award, (ii) the proceedings under the Indian , were incompetent in the absence of the consent of the Central Government under sections 86(1) and 87B of the Code, and therefore the decree passed in those proceedings was without jurisdiction and void and (iii) the amount receivable by the appellant as his privy purse was a political pension within the meaning of section 60(1)(g) of the Code, and not liable to attachment or sale in execution of a decree.
HELD: (i)The award did not create or of its own force declare any interest in any immovable property and since it did not come within the purview of section 17 of the , was not required to be registered.
[(204 H] (ii) A proceeding under section 14 read with section 17 of the , for the passing of a judgment and decree on an award, does not commence with a plaint or a petition in the nature of a plaint, and cannot be regarded as a suit and the parties to whom the notice of the filing of the award is given under section 14(2) cannot be regarded as "sued in any Court otherwise competent to try the suit" within the meaning of section 86.(1) read with section 87B of the Code.
Neither are those provisions of the Code attracted by reason of section 41(a) of the or section 141 of the Code.
It follows that the COurt was competent to entertain the proceedings under section 14 of the and pass a decree in those proceedings though no consent to the institution of the proceedings had been given by the Central Government.
[205 G H; 206 B D] 202 (iii) The amounts of the privy purse of the appellant were not liable to attachment or sale in execution of the respondent 's decree.
[209 C D] The periodical payment of money by the Government to a Ruler of a former Indian State as privy purse on political considerations and under political sanctions and not under a right legally enforceable in any municipal court is strictly a political pension within the meaning of section 60(1)(g) of the Code.
The privy purse satisfies all the essential characteristics of a political pension, and as such is protected from execution under section 60(1) (g).
[209 A C]


judgement:
Appeal No. 79 of 1965.
Appeal from the judgment and order dated August 5, 1964.
of the Rajasthan High Court, Jodhpur, in D.B. Civil Writ Petition No. 536 of 1964.
L,/B(D)SCI 13 174 Sarjoo Prasad, J.B. Dadachanji, O.C. Mathur and Ravinder Narain, for the appellant.
M.M. Tewari, K.K. Jain and R.N. Sachthey, for respondent No. 1.
B.B. Tawakley and K.P. Gupta, for respondent No. 2.
The Judgment of the Court was delivered by Raghubar Dayal, J.
This appeal, on certificate granted by the Rajasthan High Court, is against the dismissal of the appellant 's writ petition under article 226 of the Constitution praying for the issue of a writ of certiorari to the State of Rajasthan, respondent No. 1.
for the canceling and setting aside of its order dated April 1, 1964 granting the contract for collecting royalty on building stones excavated from certain area to respondent No. 2, Dharti Dan Shramik Theka Sahkari Samiti Ltd., a cooperative society.
The appeal arises in these circumstances.
The appellant offered the highest bid at the auction for the grant of royalty collection contract on January 21, 1964.
Respondent No. 2 was also one of the bidders, but stopped after offering a bid of Rs. 33,000.
The final bid of the appellant was for Rs. 42,200.
The State Government made the order in favour of respondent No. 2 on an application made by it on March 5.
stating therein that the appellant had not deposited 25 per cent of the bid amount as security immediately after the completion of the auction in accordance with r. 36(7) of the Rajasthan Minor Mineral Concession Rules, 1959, hereinafter called the rules, and as per the terms and conditions of the Auction Notification and that it was prepared to take the royalty collection contract on the highest bid of Rs. 42,200.
It was further stated in the application that respondent No. 2 was a cooperative society of the laborers who themselves worked on the mines of the area and therefore in view of Government 's policy it should receive preference to an individual bidder.
It was further stated that the benefit accruing out of the contract of royalty collection would be shared by the labourers and workers themselves which would go a long way to improve their socioeconomic conditions and thus ultimately would ameliorate the conditions of the workers who were working hard in quarries since long.
The contention for the appellant is that the Government had merely to confirm the highest bid at the auction by way of formality and was not competent to sanction the contract in favour of someone who had not offered the highest bid at the auction.
Rule 34 of the rules provides that royalty collection contracts may be granted by the Government by auction or tender for a maximum period of two years after which no extension was to be granted.
The procedure for auction is provided by r. 36.
Sub rule 175 (5) thereof provides that no bids shall be regarded as accepted unless confirmed by Government or the competent authority and sub rule (7) provides that on completion of the auction the result will be announced and the provisionally selected bidder shall immediately deposit 25 per cent of the amount of bid for one year and another 25 per cent as security for due observance of the terms and conditions of the lease or contract.
It is admitted for the appellant that on completion of the auction he did not deposit 25 per cent of the bid as security in compliance with the provisions of sub r.
He therefore lost whatever claim he could have had for the final acceptance of his bid by Government and therefore cannot question the grant of the contract to any other person by the Government.
The appellant urges that he held such royalty collection contract for the year 1963 64 and had deposited Rs. 9,250 as security for the due performance of that contract.
On February 12, 1964, over three weeks after the auction, he submitted an application to the Mining Engineer, Jaipur, stating that he had been continuously taking contract for the last three years and that he was depositing Rs. 1,300 and that the balance of the security amount required, i.e. Rs. 9,250 be adjusted against Rs. 9,250 with the Government in connection with the earlier contract.
This letter was not replied to.
The request made in this letter could not possibly be accepted.
The earlier contract was to continue up to March 31, and the security money had to remain with the Government upto that date.
It is only after March 31, that anything could be said with some definiteness as to how much of the security money in deposit would be available to the contractor.
Paragraph 2 of the Form of Agreement of Collection of Royalty on Minor Minerals, prescribed under the rules, and set out in the Schedule to the rules, states that the agreement shall remain in force for a period commencing from first April of a year and ending on March 31 of the next year on which the period of the contract would expire and that the security would be refunded on the termination of the contract.
Para 6 of the Form provides that for the due fulfillment of the terms and conditions of the contract the Contractor shall deposit 25 per cent of the contract money in advance as security which will be refunded on the termination of the contract.
The appellant alleged that there was a practice of adjusting previous security amounts towards the security for the next contract.
The practice is denied on behalf of respondent No. 1 and the practice against the provisions of the rules cannot be recognized as of any binding effect.
It may be mentioned here that the representation which the appellant made to the State Government on April 6, 1964, made no reference to his depositing the security by depositing Rs. 1,300 and by making a request for the adjustment of the balance from the security amount already in deposit and indicates that he too did not consider the request for adjustment of the amount acceptable.
176 There is nothing in r. 36 of the rules which may lead to the conclusion that the Government has to accept the highest bid by formally confirming it or that it cannot grant the contract to any person other than one who had bid the highest.
A bid is not regarded as accepted unless it is confirmed by Government.
The Government has therefore discretion to confirm the bid or not to confirm it.
Further, r. 59 provides for the relaxation of any provision of the rules in the interest of mineral development or better working of mines.
There is the letter dated February 14, 1962 from the Director of Mines and Geology, to All Mining Engineers on the subject of encouragement of cooperative mines and states that cooperative societies ought to be encouraged for mining work also as per directive of the Government of India.
Respondent No. 2 addressed a letter to the Director of Mines and Geology and referred to Government policy for the encouragement of cooperative societies in connection with royalty collection contracts.
The order of Government dated April 1, 1964, after referring to the appellant 's offering the highest bid, stated that the Government was satisfied that the Society, respondent No. 2, was a suitable party for the grant of the said contract.
The view taken by the Government in preferring respondent No. 2 to the appellant for the grant of the contract cannot be said to be arbitrary or without any justification.
The cooperative society is of the labourers who work in the mines and it is obvious that any benefit arising out of the contract would go to the labourers and thus improve their economic position.
In view of the spirit underlying r. 59, Government could therefore relax any such rule which could in any way come in the way of its granting the contract to respondent No. 2.
We therefore hold that the Government was competent to give the contract to respondent No. 2 it being not bound to accept the highest bid at the auction, though usually it accepts such bids.
Another consideration which is decisively against the appellant is that the contract for the collection of royalty for the year 1964 65 is shortly to come to an end and it would not be desirable, even if the appellant 's contentions were acceptable, to interfere with that contract.
Reference, in this connection.
may be made to the decision of this Court in K.N. Guruswamy vs State of Mysore(1) where the appellant was refused a writ solely on the ground that it would have been ineffective, the period of the impugned contract coming to an end after about a fortnight of the order of this Court.
That was a case where on merits the Court was of opinion that the writ should have been issued.
We therefore dismiss the appeal and order the parties to bear their own costs.
Appeal dismissed.

summary:
The appellant offered the highest bid at the auction for the grant of royalty collection contract on January 21, 1964.
Respondent No.2 a cooperative society of workers was also one of the bidders.
Resportdent No. 2 made an application on March 5, 1964 to the Government stating therein that the appellant had not deposited 25 Dee cent of the bid amount as security within the time prescribed by Rule 36(7) of the Rajasthan Minor Mineral Concession Rules, 1959, and that it was prepared to take the royalty collection contract on the highest bid as made by appellant.
On the above application the State Government made an order in favour of Respondent No. 2.
The appellant thereupon filed a writ petition in the High Court which was dismissed.
He was however granted a certificate of fitness.
In appeal it was contended that the Government had merely to confirm the highest bid at the auction by way of formality and was not competent to sanction the contract in favour of someone who had not offered the highest bid at the auction.
HELD: (i) The appellant had admittedly failed to deposit 25 per cent of the bid as security in compliance with the provisions of Rule 36(7).
The rules did not contemplate adjustment of security deposited for an earlier period as the appellant claimed.
He therefore lost whatever claim he could have had for the final acceptance of his bid by Government and therefore could not question the grant of the contract to any other person by the.
Government.
[175 B C] (ii) Nothing in Rule 36 requires the Government to accept the highest bid by formally confirming it.
The Government has discretion to confirm the bid or not to confirm it.
Further Rule 59 provides for the relaxation of any provision of the rules in the interest of mineral development or better working of the mines.
[176 A B] (iii) The view taken by the Government in preferring Respondent No. 2 to the appellant cannot be said to be arbitrary or without any justification.
The cooperative society is of the laborers who work in the mines and the benefit of the contract would go to the labourers.
In view of the spirit underlying Rule 59, Government could therefore relax any such rule which could in any way come in the way of" its granting the contract to Respondent No. 2.
[176 D F] (iv) The time for which the contract was granted was shortly to come to an end, and it would not be desirable even if the appellant was right to interfere with the contract.
[176 G] K.N. Guruswamy vs State of Mysore, ; , relied on.