judgement:
vil Appeal Nos.
4250 425 1 of 1986.
From the Judgment and Order dated 9th August, 1985 of the Gujarat High Court in Spl.
Civil Appln.
No. 2471 of 1985 and 62 18 of 1983.
Govind Dass, S.H. Sheth, Mrs. H. Wahi and M.V. Goswami for the Appellants.
P.S. Potio, T.U. Mehta, and M.N. Shroff for the Respondents.
The two appeals centre round the question of how to strike balance between the need of exploitation of the mineral resources lying hidden in the forests and the pres ervation of the ecological balance and to arrest the growing environmental deterioration and involve common questions of law.
In the appeal arising out of special leave petition No. 12041 of 1985 the appellant firm had been granted a 565 quarry lease for the minor mineral black trap at section No. 73 of Village Morai of Taluka Pardi, in the District of Valsad in the State of Gujarat.
The lease was granted on or about 8th November, 1971 for a period of ten years.
The area comprised of 13 acres of land for quarrying purpose.
Three persons were granted 2 1/2 acres of land each and the re maining 5 1/2 acres of land were placed at the disposal of Industries, Mines and Power Department for the purpose of granting quarry lease from the same.
The case of the appel lant was that the said lands were dereserved from the forest area from 1971.
On or about 3rd August, 1981 when the appellant 's term of lease was about to expire, the appellant applied for renewal of lease asper rule 18 of Gujarat Minor Mineral Rules, 1966 (hereinafter called the said Rules).
The appli cation of the appellant for renewal of lease was rejected by the Assistant Collector, Valsad, on the ground that the land fell under the "Reserved Forest" area and hence the (hereinafter called '1980 Act ') applied to the forests.
The forest department of State of Gujarat refused to give 'no objection ' certificate.
The contention of the appellant was that by the order dated 29th November, 1971, the forest department had dereserved the said land from the reserved area and had allotted the land for the quarrying purpose to the appellant.
The contention of the appellant was as the land was under the control of the Industries, Mines & Power department, the 1980 Act did not apply to the same.
An appeal was preferred by the appel lant which was dismissed by the Director, Industries, Mines and Power department Government of Gujarat on or about 4th March, 1985.
It is asserted by the appellant that on or about 29th January, 1983, the Government had issued two circulars instructing the Director of Geology and Mining and other authorities not to issue the leases in the fresh area issued by the State Government.
The appellant thereafter filed a writ petition in the High Court of Gujarat.
The High Court of Gujarat dismissed the petition.
The appellant has come up in appeal before this Court from the said decision.
The appeal arising out of S.L.P. No. 12041 of 1985, hereinafter mentioned as first appeal.
The case of the appellants in the second appeal is that on diverse dates quarry leases.
had been granted to the said appellants.
There were ten of them.
Eight of the appellants got their first renewal of their quarry leases in 1976 77.
Appellant No. 9 applied for first renewal in August, 1979.
Appellant No. 6 applied for first renewal on 20th July, 1982.
In 1982, some of the appellants except appellants 6 to 9 applied 566 for second renewal to the Collector.
In December, 1982, second renewals were refused by the Collector.
Revision filed by the appellants against the order of the Collector was rejected by the Director, Geology and Mining in 1983 and in December, 1983, writ petition often described as special civil application was filed before the High Court, challeng ing the refusal to renew.
The High Court rejected the said writ petition.
The second appeal herein arises out of the said decision in August, 1985 of the High Court of Gujarat.
Both these appeals involve the question, whether after coming into operation of 1980 Act, the appellants were entitled to renewal either first or second of their quarry leases? In this connection it is necessary to refer to the 1980 Act.
This was an Act passed by the Parliament to pro vide for the conservation of forest and for matters connect ed therewith or ancillary thereto.
The Statement of Objects of the said Act is relevant.
It is stated that deforestation caused ecological imbalances and led to environmental dete rioration.
It recognised that deforestation had been taking place on a large scale in the country and it had thereby caused widespread concern.
With a view to checking further deforestation, an Ordinance had been promulgated on 25th October, 1980.
The Ordinance made the prior approval of the Central Government necessary for dereservation of reserved forests and for the use of forest land for non forest pur poses.
The Ordinance had also provided for the constitution of an advisory committee to advise the Central Government with regard to grant of such approval.
The 1980 Act replaced the said Ordinance.
The Act extends to the whole of India except the State of Jammu & Kashmir, and came into force on 25th October,: 1980.
Section 2 of the said Act is only relevant for our present purpose.
It provides as follows: "2. Restriction on the dereservation of for ests or use of forest land for non forest purpose Notwithstanding anything contained in any other law for the time being in force in a State, no State Government or other authority shall make, except with the prior approval of the Central Government, any order directing (i) that any reserved forest (within the meaning of the expression "reserved forest" in any law for the time being in force in that state) or any portion thereof, shall cease to be reserved; (ii) that any forest land or any portion thereof may be used for any non forest pur pose.
567 Explanation.
For the purposes of this section "non forest purposes" means breaking up or clearing of any forest land or portion thereto for any purpose other than re afforestation. " The said section makes it obligatory for the State Government to obtain the permission of the Central Govern ment for (1) dereservation of reserved forest and (2) for use of forest land ' for non forest purposes.
It is apparent, therefore, that the two dual situations were intended to be prevented by the legislation in question., namely dereserva tion of reserved forest, and use of forest land for non forest purposes.
In the instant appeals leases for quarrying purposes had been granted prior to the coming into operation of the Act in question.
Shri Gobind Dass, learned counsel for the appellant in the first appeal and Shri Sheth learned counsel for the appellants in the second appeal contended that there was no question of extending for non forest purposes forest lands.
There were existing quarry leases in one case first renewal was sought and in some other cases second or third renewals were being sought.
Therefore these were at the relevant time dereserved forests.
Neither of the two contin gencies sought to be prevented was there.
The conditions precedent for the operation of the Act were not there in the facts of these appeals, it was urged.
Our attention was drawn to rule 18 of Gujarat Minor Mineral Rules, 1966 which were framed under the Act 67 of 1957 by the Government of Gujarat.
The rules provided for the period of the lease, renewals and availability of areas already granted and sub clause (b)(i) of the said rule 18 of the said Rules provides as follows: "(b)(i) The lease for all minerals specified in sub clause (i) of clause (a) may be renewed by the competent officer for one or more periods and the period of renewal at one time shall not exceed ten years and the total period for which the lease may be renewed shall not exceed twenty years in the aggre gate." Shri Sheth drew our attention to rule 3 of Part VIII (page 62) of the Manual which deals with the procedure of granting renewals under the rules.
On the other hand Shri Mehta, counsel for the respondents in the 568 first appeal and Shri Poti, counsel for the respondents in the second appeal contended before us that after coming into operation of 1980 Act there was no question of renewal of the leases because this Act had prevented renewal of the lease without the approval of the Central Government.
Shri Gobind Dass, however, placed strong reliance on State of Rajasthan vs Hari Shankar Rajendra Pal, ; That was a decision dealing with Rajasthan Mines Minerals Concession Rules, 1958.
This Court in that case was concerned with Rule 30 under Chapter IV under the said Rajasthan Rules.
This Court observed that the word "may ' in the proviso in rule 30 in regard to the extension of the period by Government should be construed as 'shall ' so as to make it incumbent on Govern ment to extend the period of the lease if the lessee desired extension.
The Rajasthan Rules provided, inter alia, as follows: "Period of lease A mining lease may be grant ed for a period of 5 years unless the appli cant himself desires a shorter period; Provided that the period may be extended by the Government for another period not exceeding 5 years with option to the lessee for renewal for another equivalent period, in case the lessee guarantees invest ments in machinery, equipments and the like, at least to the tune of 20 times the value of annual dead rent within 3 years from the grant of such extension.
The value of the machinery, equipment and the like shall be determined by the Government.
Where the lease is so renewed, the dead rent and the surface rent shall be fixed by the Government within the limits given in the Second Schedule to these rules, and shall" in no case exceed twice the origi nal dead rent and surface rent respectively, and the royalty shall be charged at the rates in force at the time of renewal.
" It was submitted by Shri Gobind Dass that the said rule was in pari materia with sub rule (b) of rule 18 of Gujarat Minor Mineral Rules 1966.
Often when a public authority is vested with power, the expression 'may ' has been construed as 'shall ' because power if the conditions for the exercise are fulfilled is coupled with duty.
As observed in Craies On Statute Law, 7th Edition, page 229, the expression "may" and "shall" have often been subject of constant and con 569 flicting interpretation.
"May" is a permissive or enabling expression but there are cases in which for various reasons as soon as the person who is within the statute is entrusted with the power, it becomes his duty to exercise it.
As early as 1880 the Privy Council in Julius vs Lord Bishop of Ox ford, 1880, 5 Appeal Cases, 214.
explained the position.
Earl Cairns, Lord Chancellor speaking for the judicial committee observed dealing with the expression "it shall be lawful" that these words confer a faculty or power and they do not of themselves do more ' than confer a faculty or power.
But the Lord Chancellor explained there may be some thing in the nature of the thing empowered to be done, sometimes in the object for which it is to be done, some thing in the conditions under which it is to be done, some thing in the title of the person or persons ' for whose benefit the power is to be exercised, which may couple the power with a duty, and make it the duty of the person in whom the power is reposed, to exercise that power when called upon to do so.
Whether the power is one coupled with a duty must depend upon the facts and circumstances of each case and must be so decided by the courts in each case.
Lord Blackburn observed in the said decision that enabling words were always compulsory where the words were to effectuate a legal right.
Here the case of the appellants is that they have in vested large sums of money in mining operations.
Therefore, it was the duty of the authorities that the power of grant ing permission should have been so exercised that the appel lants had the full benefits of their investments.
It was emphasized that none of the appellants had committed any breach of the terms of grant nor were there any other fac tors disentitling them to such renewal.
While there was power to grant renewal, and in these cases there were clauses permitting renewals, it might have cast a duty to grant such renewal in the facts and circumstances of the cases specially in view of the investments made by the appellants in the areas covered by the quarrying leases, but renewals cannot be claimed as a matter of right for the following reasons.
The rules dealt with a situation prior to the coming into operation of 1980 Act. ' 1980 Act ' was an Act in recog nition of the awareness that deforestation and ecological imbalances as a result of deforestation have become social menaces and further deforestation and ecological imbalances should be prevented.
That was the primary purpose writ large in the Act of 1980.
Therefore the concept that power coupled with the duty enjoined upon the respondents to renew the lease stands eroded by the mandate of the legislation as manifest in 1980 Act in the facts and circumstances of these cases.
The primary 570 duty was to the community and that duty took precedence, in our opinion, in these cases.
The obligation to the society must predominate over the obligation to the individuals.
For the same reasons we are unable to accept the view that the ratio of the decision of this Court in the case of State of Rajasthan vs Hari Shankar Rajendra Pal (supra) could be invoked in the facts and circumstances of these cases to demand renewal.
Furthermore it appears to us from the affidavits in opposition filed on behalf of the respond ents that there were good Founds for not granting the renew al of the lease.
The orders of the appropriate authorities in both these cases deal with the situation.
Both Shri Gobind Dass as well as Shri Sheth, however, relied very heavily on the decision of this Court in State of Bihar vs Banshi Ram Modi and Others, ; As the said decision dealt with section 2 of the 1980 Act, it is necessary to refer to the facts of that case.
There a mining lease for winning mica was granted by the State Government in respect of an area of 80 acres of land which formed part of reserved forest before coming into force of 1980 Act.
However, the forest land had been dug up and mining operations were being carried on only in an area of 5 acres out of the total lease area of 80 acres.
While carry ing on mining operations, the respondent came across two associate minerals felspar and quartz in the area.
The respondent in that case, therefore, made an application to the State Government for execution of a Deed of Incorpora tion to include the said minerals also in the lease.
Though the 1980 Act had come into force, the State Government executed the Deed of Incorporation incorporating these items without obtaining prior sanction of the Central Government under section 2 of 1980 Act.
Since the respondent in that case made a statement before the Court that he would carry on the mining operations only on 5 acres of land which had already been utilised for non forest purposes even before the Act came into force, the question for determination was whether prior approval of the Central Government under section 2 of 1980 Act in the facts of that case was neces sary for the State Government for granting permission to win associate minerals also within the same area of 5 acres of land? This Court answered the question in negative and affirmed the judgment of the High Court.
This Court observed at pages 647 and 648 of the report as follows: "The relevant parts of Section 2 of the Act which have to be construed for pur poses of this case are clause (ii) of and 571 the Explanation to that section.
Clause (ii) of Section 2 of the Act provides that notwith standing anything contained in any other law for the time being in force in a State, no State Government or other authority shall make, except with the prior approval of the Central Government, any order directing that any forest land or any portion thereof may be used for any non forest purpose.
Explanation to Section 2 of the Act defines "non forest purpose" as breaking up or clearing of any forest land or portion thereof for any purpose other than reforestation.
Reading them togeth er, these two parts of the section mean that after the commencement of the Act no fresh breaking up of the forest land or no fresh clearing of the 'forest on any such land can be permitted by any State Government or any authority without the prior approval of the Central Government.
But if such permission has been accorded before the coming into force of the Act and the forest land is broken up or cleared then obviously the section cannot apply.
In the instant case it is not disputed that in an area of five acres out of eighty acres covered by the mining lease the forest land had been dug up and mining operations were being carried on even prior to the coming into force of the Act.
If the State Government permits the lessee by the amendment of the lease deed to win and remove felspar and quartz also in addition to mica it cannot be said that the State Government has violated Section 2 of the Act because thereby no per mission for fresh breaking up of forest land is being given.
The result of taking the contrary view will be that while the digging for purposes of winning mica can go on, the lessee would be deprived of collecting felspar or quartz which he may come across while he is carrying on mining operations for winning mica.
That would lead to an unreasonable result which Would not in any Way subserve the object of the Act.
We are, therefore, of the view that while before granting permission to start.
mining operations on a virgin area Section 2 of the Act has to be complied with it is not necessary to seek the prior approval of the Central Government for purposes of carrying out mining operations in a forest area which is broken UP or cleared before the commencement of the Act.
The learned counsel for respondent 1 has also given an undertaking that respondent 1 would confine his mining operations only to the extent of five acres of land on which mining operations 572 have already been carried out and will not feel or remove any standing trees thereon without the prior permission in writing from the Central Government.
Taking into considera tion all the relevant matters, we are of the view that respondent 1 is entitled to carry on mining operations in the said five acres of land for purposes of removing felspar and quartz subject to the above conditions.
" The aforesaid observations have been set in detail in order to understand the true ratio of the said decision in the background of the facts of that case.
It is true that this Court held that if the permission had been granted before the coming into operation of the 1980 Act and the forest land has been broken up or cleared, clause (ii) of section 2 of 1980 Act would not apply in such a case.
But that decision was rendered in the background of the facts of that case.
The ratio of any decision must be understood in the background of the facts of that case.
It has been said long time ago that a case is only an authority for what it actually decides, and not what logically follows from it.
(See Lord Halsbury in Quinn vs Leathem) [1901] Appeal Cases 495.
But in view of the mandate of Article 141 that the ratio of the decision of this Court is a law of the land, Shri Gobind Dass submitted that the ratio of a decision must be found out from finding out if the converse was not cor rect.
But this Court, however, was cautious in expressing the reasons for the said decision in State of Bihar vs Banshi Ram Modi & Others (supra).
This Court observed in that decision that the result of taking the contrary view would be "that while digging for purposes of winning mica can go on, the lessee would be deprived of collecting fel spar or quartz which he may come across while he is carrying on mining operations for winning mica.
That would lead to an unreasonable result which will not in any way sub serve the object of the Act.
" There was an existing lease where mining operation was being carried on and what was due by incorpo ration of a new term was that while mining operations were being carried on some other minerals were available, he was given right to collect those.
The new lease only permitted utilisation or collection of the said other minerals.
In the instant appeals the situation is entirely differ ent.
The appellants are asking for a renewal of the quarry leases.
It will lead to further deforestation or at least it will not help reclaiming back the areas where deforestations have taken place.
In that view of the matter, in the facts and circumstances of the case, in our opinion, the ratio of the said decision cannot be made applicable to support the appellants ' demands in these cases because the facts are entirely diffe 573 rent here.
The primary purpose of the Act which must sub serve the interpretation in order to implement the Act is to prevent further deforestation.
The Central Government has not granted approval.
If the State Government is of the opinion that it is not a case where the State Government should seek approval of the Central Government, the State Government cannot apparently seek such approval in a matter in respect of, in our opinion, which it has come to the conclusion that no renewal should be granted.
In that view of the matter and the scheme of the Act, in our opinion, the respondents were fight and the appellants were wrong.
All interpretations must sub serve and help implementation of the intention of the Act.
This interpreta tion, in our opinion, will sub serve the predominant purpose of the Act.
In that view of the matter, we are unable to sustain the submissions urged in support of these appeals.
The appeals therefore fail and are accordingly dismissed.
In view of the facts and circumstances of these appeals, however, we direct the parties to pay and bear their own costs.
P.S.S. Appeals dismissed.

summary:
Sub clause (b)(i) of rule I8 of Gujarat Minor Mineral Rules, 1966, which were framed under Act 67 of 1957, pro vides that the lease for all minerals specified in sub clause (i) of clause (a) may be renewed by the competent officer for one or more periods not exceeding ten years at one time.
Section 2 of the , brought into force on 25th October, 1980 provides that notwithstanding anything contained in any other law for the time being in force in a State, no State Government or other authority shall make, except with the prior approval of the Central Government, any order directing (i) dereservation of reserved forest, and (ii) the use of forest land for non forest purposes.
The appellants had been granted leases for quarrying minor minerals prior to the coming into operation of the 1980 Act.
Their applications for renewal of leases under r. 18 of the Rules were rejected by the competent authority on the ground that the lands fell under the reserved forests which were governed by the 1980 Act.
Their revision applica tions failed, and the High Court also rejected the writ petitions filed by them.
563 In the appeals by special leave, it was contended for the appellants that the conditions precedent for the opera tion of the Act were not existing, that there was no ques tion of extending for non forest purposes forest lands, since their 's were existing quarry leases in areas which were at the relevant time dereserved forests, that they had not committed any breach of the terms of grant nor there were any other factors disentitling them to such renewal, that the words 'may be renewed ' in r. 18(b)(i) should be read as 'shall be renewed ', and so read they make it incum bent on the Government to renew the lease if the lessee so desired, and as they had invested large sums of money in mining operations a duty was cast on the authorities to exercise the power granting permission in a manner that they could receive full benefit of their investments.
For the respondents it was contended that after the coming into operation of 1980 Act there was no question of renewal of the leases because it had prevented renewal of lease without the approval of the Central Government.
Dismissing the appeals, the Court, HELD: 1.
Whether the power is one coupled with a duty must depend upon the facts and circumstances of each case and must be so decided by the Courts in each case.
[569D] I.2 The Gujarat Minor Minerals Rules, 1966 dealt with a situation prior to the coming into operation of the .
While under r. 18 of the Rules there was power to grant renewal, which might have cast a duty on account of the investments made by the appellants in the areas covered by the quarrying leases, they could not claim renewals as a matter of right after the Act was brought into force.
Their applications were rejected on good grounds.
The orders of the appropriate authorities deal with the situation.
Julius vs Lord Bishop of Oxford, [1880] 5 Appeal Cases 214 and Craies on Statute Law, 7th Edn. 229, referred to.
2.1 All interpretations must subserve and help implement the intention of the Act.
The primary purpose of the Act of 1980 is to prevent further deforestation and ecological imbalances.
Therefore, the concept that power coupled with duty enjoined upon the respondents to renew the lease, stands eroded by the mandate of the legislation manifest in the Act.
The primary duty was to the community and that 564 took precedence over the obligation to the individuals.
[573C,A,569H 570A] 2.2 The appellants are asking for renewal of the quarry leases.
It will lead to further deforestation or at least it will not help reclaiming hack the areas where deforestations have taken place.
The Central Government has not granted approval.
If the State Government was of the opinion that this was not a case where it should seek approval of the Central Government, the State Government could not apparent ly seek such approval.
[572G, S73A] 3.
The ratio of any decision must he understood in the background of the facts of that case.
A case is only an authority for what it actually decides, and not what logi cally follows from it.
[572C] Quinn vs Leathem, [1901] Appeal Cases 495, referred to.
State of Rajasthan vs Hari Shankar Rajendra Pal, ; , State of Bihar vs Banshi Ram Modi and Others, ; , distinguished.


judgement:
Appeal No. 447(N) of 1973.
From the Judgment and Decree dated 18/19.4.1972 of the Gujarat High Court in First Appeal No. 184 of 1964.
V.A. Bobde and A.G. Ratnaparkhi for the Appellant.
S.C. Manchanda, Ms. A. Subhashini and K.C. Dua for the Respondents.
This appeal arises out of a certificate granted by this Court.
The facts necessary for the disposal of this appeal are that the respondent No. 1 Union of India fried a suit against the petitioner.
The petitioner is a public limited company.
Respondent No. 2 which is also a public limited company was the assessee company and the Union of India, respondent No. 1 had to recover a sum of Rs 1,32,400.87 p. from the said assessee company on account of arrears of income tax, excess profit tax, business profit tax.
To recover this amount a suit was filed on 15.2.58 impleading therein besides the present appellant said asses see company and others as defendants.
It was alleged that the assessee company by its letter dated 4.10.48 informed the plaintiff Union of 364 India that the arrears due from it be recovered from the petitioner on account of its commission.
It was alleged that for recovery of the said amount notice under Section 46(2) of the Income Tax Act was issued on two occasions, 9.11.48 and 30.3.51 and thereafter a notice under Section 46(5A) of the Act was issued against the appellant defendant No. 1 Kalyan Mills Ltd. on July 22, 1949.
It is alleged that the defendant No. 1 assessee company had informed the plaintiff Union of India by a letter dated October 11, 1948 that the tax dues recoverable from the assessee company be recovered from the amount which was owed by the appellant company to the assessee company.
It was inter alia asserted in the plaint that the debt due by the appellant company to the assessee company was shown to the credit of the assessee company in the accounts of the appellantcompany.
It is said that by two letters addressed by the appellant company on November 18, 1948 and December 3, 1948, it acknowledged and admitted its liability to the assessee company and had further more promised the plaintiff to pay the amount of tax dues against the debt due by the appellant company, to the assessee company.
The plaintiff proceeded to assert in view of the admissions made by the appellant company and the promise made by it to pay the tax dues from the debt due by it to the assessee company and having regard to the recovery proceedings undertaken by the competent authority under Sections 46(2) and 46(5A) of the Act, the plaintiff had priority over all other unsecured dues and that the appel lant company was under an obligation to pay the amount of Rs 1,32,400.87 p. under these circumstances.
It was also al leged by the plaintiff respondent (Union of India) that notwithstanding the fact that the debt due by the appellant company to the assessee company was shown to the credit of the assessee company in the books of accounts of the appellant company.
The appellant company had subsequent ly set up a false theory that the assessee company itself was liable to the appellant company and that the appellant company was not liable to pay dues of the assessee.
was in terms asserted that the version set up by the appellant company that it had a claim against the assessee company was a got up version and that it had been created merely with a view to defeat or delay the dues of the plaintiff.
It was contended that the appellant company had made a false coun ter claim against the assessee company with this end in view viz. to defeat and delay the claim of the plaintiff though it had taken no action in regard to the alleged counter claim.
A reference was made to a resolution passed by the appellant company on December 9, 1949 to transfer the debt due to the assessee company to the Managing Agents ' commis sion and suspense account.
No action was ever taken by the appellant company against the assessee company for the alleged claim arising in the context of damages in connec tion with the alleged malfeasance and misfeasance of the assessee company in the course of discharge of their func tions as the Managing Agents of the appellant company.
As admittedly the assessee company was functioning as the Managing Agents of the appellant company, it was contended that no action was taken for more 365 than three years and that no steps have been taken in this connection because the counter claim was a sham one.
It was further contended by the plaintiff respondent (Union of India) that the appellant company and the assessee company were colluding with each other with the object of defeating or delaying the payment to the plaintiff and that the adjustment entries made by the appellant company in its books of accounts were a step in this direction.
Such en tries or adjustments were illegal and they were not binding on the plaintiff in as much as the recovery proceedings had already been initiated against the assessee company and that the adjustments and entries were false as was evident from the admissions made by the appellant company in its letter to the plaintiff.
A charge of fraud and collusion has been levelled against the. appellant company, the assessee compa ny and the other defendants.
With these facts the respondent Union of India instituted the present suit seeking a decree against defendants 1 to 5 i.e. the present appellant and other defendants for an amount of Rs 1,32,400.87 p. with interest and a prayer also was made for appointment of receiver for recovery of the amount due from defendant No. 5 and its nominees other defendants.
Various defences were raised.
The suit was decreed by the trial court and the trial court held that the plaintiff respondent was not entitled to a money decree against the appellant company.
It also recorded a finding that the contention of the appellant company that it had a genuine and valid counter claim against the assessee company and that it had been adjusted was unfounded.
In the opinion of the learned trial court it was a unilateral act of the appellant company of adjusting the sum due to the assessee company against the alleged claim in respect of damages for malfeasance and misfeasance against the assessee company was invalid and was not binding on the plaintiff respondent.
It also held that the sum in ' excess of the tax claimed by the plaintiff from the assessee company was due to the assessee company against the appel lant and it held that the plaintiff was entitled to a decree for appointment of receiver to realise the dues of the plaintiff from the appellant company having regard to the fact that appellant company was indebted to the assessee company for a sum in excess of tax dues claimed by the plaintiff, and to that extent the suit was decreed.
The appellant preferred an appeal and a Division Bench of the Gujarat High Court by their judgment dated April 19, 1972 dismissed the appeal and maintained the decree passed by the trial court and on certificate against that judgment that the present appeal is filed in this Court.
The main contention advanced on behalf of the appellant was that a suit was filed by the respondent and the decree granted by the trial court was not permissible in law as it was con tended that such proceedings for appointment of receiver can only be contemplated in execution proceedings of a decree against the original debtor.
Facts are not in dispute.
The learned Judges of the High Court maintained the 366 decree by coming to the conclusion that the amount of com mission earned by the assessee company was admittedly with the appellant.
It was withheld by the appellant under the pretext that it had a counter claim against the assessee.
It is also not in dispute that under Sec.
46(2) a prohibitory order attaching the said money of the assessee company was issued.
It is also not in dispute that the machinery under Sec.
46(5A) of the Income Tax Act was no longer effective as the appellant set up a counter claim against the assessee company and there was no option for the Union of India but to obtain adjudication from the civil court and in this view of the matter the learned Judges of the Gujarat High Court maintained the decree passed by the trial court.
An objection was also taken about the form of the decree passed by the trial court which only was for the appointment of a receiver.
Admittedly no money decree could be passed against the appellant company except for the money lying in the deposits with them of the assessee company and it is for that purpose that the decree for appointment of receiver was made so that the amount be recovered and paid to the plain tiff Union of India.
Having considered the question and heard the learned counsel for the appellant, we see no error in the judgment passed by the learned High Court of Gujarat.
The appeal is therefore dismissed with costs.
A.P.J. Appeal dismissed.

dataset_name: IN-Abs

summary:
The Union of India Respondent No. 1, had to recover certain arrears of taxes from the assessee company Respond ent No. 2.
The assessee company informed the Union of India that the tax dues recoverable from it be recovered from the amount which was owed by the appellant company to it.
The debt due by the appellant company to the assessee company was shown to the credit of assessee company in the accounts of the appellant company.
The appellant company acknowl edged and admitted its liability to the assesseecompany and promised the Union of India to pay the amount of tax dues against the debt due by it to the assessee company.
Notices under section 46(2) and section 46(5A) of the Income Tax Act were issued to the appellant company for the recovery of the said amount.
The Union of India filed a suit seeking a decree against the appellant company and four other defendants.
The appel lant company set up a false theory that the assessee company itself was liable to pay the appellantcom pany and, therefore, it was not liable to pay tax dues of the assessee company.
The trial court decreed the suit holding that the Union of India was entitled to a money decree against the appel lant company.
The appeal preferred by the appellant company was dismissed by the High Court.
In the appeal to this Court on behalf of the appellant company it was contended that a suit as filed by the respondent and the decree granted by the trial court was not permissible in law because proceedings for appointment of 363 receiver can only be contemplated in execution proceedings of a decree against the original debtor.
Dismissing the appeal the Court, HELD: 1.
The High Court has rightly maintained the decree by coming to the conclusion that the amount of com mission earned by the assesseecompany was admittedly with the appellant.
It was withheld by the appellant under the pretext that it had a counter claim against the assessee Under section 46(2) of the Income Tax Act, a prohibitory order attaching the said money of the assessee company was issued and the machinery under S.46(5A) of the Act was no longer effective as the appellant set up a counter claim against the assessee and there was no option for the Union of India but to obtain adjudication from the civil court.
[365H 366B] 2.
No money decree could be passed against the appel lant company except for the money lying in the deposits with them for the assessee company and it is for that pur pose that the decree for appointment of receiver was made so that the amount be recovered and paid to the plaintiff Union of India.
[366C D]


judgement:
Appeal No. 459 of 1980.
From the Judgment and Order dated 10.1.1980 of the Punjab and Haryana High Court in C.R. No. 34 of 1980 P.K. Banerji, V.C. Mahajan, Mrs. Urmila Kapoor and Ms. A. Prabhawathy for the Appellant.
Raja Ram Agarwal, B.P. Maheshwari, S.N. Agarwal and B.S. Gupta for the Respondent.
The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
This appeal by special leave is from the decision of the Punjab & Haryana High Court dated 10th January, 1980.
The appellant is the tenant.
The appeal arises out of the summary dismissal of the revision petition filed by the tenant under section 151 of the Code of Civil 519 Procedure from the decision of the appellate authority under the Haryana Urban (Control of Rent and Eviction) Act, 1973 being Act No. 11 of 1973 (hereinafter referred to as the 'Act ').
The appellant took on rent the premises in question from the previous landlord in or about July, 1962.
On or about 11th October, 1971, the respondent purchased the premises in question being suit No. 292 of Ward No. 13, District Gurgaon from the previous landlord.
The premises hereinafter will be referred as the 'premises '.
Few months prior thereto that is to say on 10th July, 1971, the respondent had purchased another house near Kabir Bhavan, Gurgaon.
The appellant 's case was that the respond ent got vacant possession of the same.
The respondent, however, denied that assertion.
On 7th August, 1972 the respondent sold the said house near Kabir Bhavan.
It is asserted that the sale was to one Resham Devi who is alleged to be the sister in law of the respondent.
On the other hand this is disputed and it appears that she is the sister in law of the brother of the respondent.
The assertion of the appellant was that this was a benami transaction.
On 14th January, 1974, an application for ejectment was filed before the Rent Controller by the respondent on grounds of (a) non payment of rent, (b) sub letting, and (c) bona fide requirement.
So far as the grounds of non payment of rent and sub letting, are concerned, it has been held by all the courts in favour of the tenant.
Those findings are not in dispute in this appeal.
The only ground that survives is the bona fide requirement of the landlord.
The Rent Controller on 7th November, 1978 rejected the petition of the landlord on the ground that the landlord had not been able to prove all the ingredients of section 13(3)(a)(i) of the Act.
The respondent thereafter filed an appeal before the Appellate Authority.
Before the Authority, an, application was made for admission of additional evidence by the respondent/landlord.
Such additional evidence were permitted to be adduced and were recorded on various dates.
The appeal was allowed by the appellate authority on 7th December, 1979.
The appellant herein filed a revision petition as mentioned hereinbefore before the High Court under section 151 of the Code of Civil Procedure, and the same was dis missed by the High Court in limine on 10th January, 1980.
The only question that requires consideration in this appeal, is whether on the facts and in the circumstances of the case, the landlord came within the provisions of section 13(3)(a)(i) of the Act.
The Act which is an Act to control the increase of rent of certain buildings and rented land situated within the limits of urban areas, and the eviction of tenants therefrom, provides by section 13( 1 ) that a tenant in possession of a building or a rented land shall not be evicted therefrom except in accordance with the provisions of the said 520 section.
Sub section (3)(a)(i) of section 13 provides as follows: "(3) A landlord may apply to the Controller for an order directing the tenant to put the landlord in possession (a) in the case of a residential building, if (i) he requires it for his own occupation, is not occupying another residential building in the urban area concerned and has not vacated such building without sufficient cause after the commencement of the 1949 Act in the said urban area.
" Before we deal with the other contentions, it may be mentioned that on behalf of the appellant, Shri P.K. Banerji learned advocate contended that the appellate authority was in error in firstly admitting additional evidence at the appellate stage in the facts and circumstances of the case, and secondly, the appellate authority had not considered the evidence adduced by the appellant before the Rent Control ler.
We are unable to accept these submissions urged on behalf of the appellant.
The appellate authority, it must be mentioned, has normally the same jurisdiction to admit additional evidence as the trial court if the facts and circumstances so warrant.
Furthermore, in the instant case section 15 of the Act deals with the powers of the appellate and revisional au thorities under the Act.
Sub section (4) of the said section specifically provides that if necessary, after further enquiry as it thinks fit either personally or through the Controller, the appellate authority shall decide the appeal.
Therefore, the appellate authority has by express provision jurisdiction to admit additional evidence.
Indeed in this case from the written statement, it appears that the only contention that was sought to be raised was about the extent of the accommodation available to the landlord in the ances tral house of the landlord.
The allegation about the alleged sale of the premises near Kabir Bhavan was not clearly spelled out.
Therefore, if the interest of justice so demanded, the appellate authority was justified in admitting the additional evidence.
The parties in this case had ample opportunity to test the veracity and to examine and submit on the value of such additional evidence.
No prejudice could be said to have been caused by admission of such additional evidence.
In State of Kerala vs
K.M. Charia Abdullah & Co., ; this Court was dealing with similar power under Madras General Sales Tax Act, 1939 and observed at page 610 of the report that by sub section (4) of section 250 of the Income Tax Act, 1961 which is similar to section 33(4) of the Indian Incometax Act, 1922, the Commissioner was authorised for disposing of the appeal to 521 make such further enquiry or to direct the Income tax Offi cer to make further enquiry as he thought fit and report upon them.
This Court held that it could not denied that the said sub section conferred upon the appellate or revising authority power to make such enquiry as it thought fit for fair disposal of appeal.
We are, therefore, clearly of the opinion that in the facts and circumstances of a particular case, the appellate authority has jurisdiction under the Act in question to admit additional evidence.
We are further of the opinion that in this case admission of such additional evidence was warranted by the facts and the pleadings in this case.
We are satisfied that by such admission of evi dence, no prejudice has been caused to the appellant.
Indeed reading of the order of the appellate authority makes it abundantly clear that the appellate authority had adverted to all the facts recorded by the Rent Controller and further considered the additional evidence.
It is true that in referring to the findings of the Rent Controller, the appel late authority in its order had not specifically referred to the paragraphs of the order of the Rent Controller but that does not mean nor does it indicate that the appellate au thority had not considered evidence adduced before the Rent Controller.
We are, therefore, unable to sustain the objec tions urged on behalf of the appellant by Shri Banerji, on admission and consideration of the additional evidence.
The appellate authority noted that the party had led evidence before the Rent Controller and after hearing the party, the Rent Controller held in the manner he did.
The appellate authority therefore was conscious of the evidence adduced by the appellant before the Rent Controller.
The criticism that there was no consideration of the evidence adduced by the appellant before the Rent Controller by the appellate authority is, therefore, not justified in the facts and circumstances of the case.
The Rent Controller as noted hereinbefore held that the appellant had proved the bona fide requirement.
The appellate authority had noted the evidence adduced by the respondent before the appellate authority.
It is clear that the residential house of the family of the petitioner was having two rooms only and there was large number of persons occupying the two rooms.
The family of the petitioner consisted of really seven brothers and one sister.
Admittedly two brothers and their families were occupying the said premises.
The premises in question belonged to the grand father of the respondent.
The grand father was an advocate.
He died.
After his death his chamber was let out to Laxmi Commercial Bank.
It was contended that the respondent was a co parcener in the said joint family house.
It was submitted that if the said chamber which was a big room was available, then, it could not be said that there was dearth of the accommodation in the ancestral house.
It is true that the appellate authority had proceeded on the basis that the two rooms for occupation were avail able in the said house for the father and the two sons including the respondent and 522 his family in the ancestral house.
But assuming that even if we take into consideration the chamber of the late grand father which had been let out to Laxmi Commercial Bank, that will also be wholly insufficient to meet the reasonable and bona fide requirement of the respondent.
The appellate authority further held that the appellant was a licensee in respect of the ancestral house and he was staying there with the permission or the licence given by his father and he had no right and as such his interest in the ancestral house could not be considered to be "occupying another residential house" in terms of Clause (1) of sub section 3(a) of section 13 of the Act.
It was submitted before us that this is incorrect because a co parcener in respect of the ancestral house was a co owner and an owner could not be considered to be a licensee of the father in respect of a house belonging to Mitakshara joint family.
There is no dispute that the family in question is governed by the Mitakshara School of Hindu Law.
It is abundantly clear that Ashok, Isher and Jagadish being the brothers of the appellant and the family belonging to the joint family of the respondent with their children were staying in the ancestral house.
Lalit, another brother, had another house.
As mentioned hereinbefore there were other persons but about their stay there was no clear evi dence.
It is asserted by the respondent that they are seven brothers and one sister.
But even assuming that Ashok, Isher and Jagadish and the children stay in the ancestral house and assuming that the big room which had been let out to Laxmi Commercial Bank is taken into consideration, the accommodation is still very inadequate for reasonable and bona fide requirement of the landlords.
The question, there fore, whether the respondent was a licensee of his father or a co owner of the property, namely the ancestral house is not really necessary to be decided.
But it was contended on behalf of the appellant that this approach of the appellate authority had vitiated the conclusion.
It is therefore necessary to allay the grievance of the appellant on this score.
Our attention was drawn to a decision of the Judicial Committee in Rani Sartaj Kuari and Another vs Rani Deoraj Kuari, [15] Indian Appeals, 51 (Mother and Guardian of Lal Narindur Bahadur Pal).
That case was in respect of an impat ible estate governed by the Mitakshara School of Hindu Law.
There was a custom that the estate was impartible and was descendible to single heir by the rule of primogeniture.
It was held that in order to render alienations by the rejah in that case invalid as made without the consent of his son it must be shown.that the rajah 's power of alienation was excluded by the custom or by the nature of the tenure.
In such a raj the son is not a co sharer with his father.
The Judicial Committee further observed that property in ances tral estate acquired by birth under the Mitakshara law is so connected with the fight to partition that it does not exist independently of such fight.
At 523 page 64 of the report, the Judicial Committee observed that the property in the paternal or ancestral estate acquired by birth under the Mitakshara law is, in the opinion of the Judicial Committee, so connected with the fight to parti tion, that it did not exist where there was no right to it.
We are of the opinion that no much support can be sought for by the appellant from the said decision; Here in the instant case, the question is whether the respondent who undoubtedly was governed by the Mitakshara School of Law, had acquired a fight to ancestral property by his birth.
But this question has to be judged in the light of the .
Reliance was also placed on State Bank of India vs Ghamandi Ram (Dead) Through Shri Gurbax Rai at page 686 of the report, this Court observed that accord ing to the Mitakshara School of Hindu law all the property of a Hindu joint family was held in collective ownership by all the coparceners in a quasi corporate capacity.
The Court approved the observations of Mr. Justice Bhashyam Ayyanger in Sundarsanam Maistri vs Narasimhulu Maistri and Anr.
[ILR 25 Mad.
149, 154.
But the question in the instant case is the position of the respondent after coming into operation of the .
Shri Banerji drew our attention to Mulla 's 'Hindu Law ' 15th Edition at page 924 where the learned commentator had discussed effect in re spect of the devolution of interest in Mitakshara coparce nary property of the coming into operation of the .
This question has been considered by this Court in Commissioner of Wealth Tax, Kanpur and Others vs Chander Sen and Others, ; where one of us (Sabyasachi Mukharji, J) observed that under the Hindu Law, the moment a son is born, he gets a share in father 's property and become part of the coparcenary.
His fight accrues to him not on the ' death of the father or inheritance from the father but with the very fact of his birth.
Normally, therefore whenev er the father gets a property from whatever source, from the grandfather or from any other source, be it separated property or not, his son should have a share in that and it will become part of the joint Hindu family of his son and grandson and other members who form joint Hindu family with him.
This Court observed that this position has been affect ed by section8 of the and, there fore, after the Act, when the son inherited the property in the situation contemplated by section 8, he does not take it as Kar of his own undivided family but takes it in his individual capacity.
At pages 577 to 578 of the report, this Court dealt with the effect of section 6 of the Hindu Suc cession Act, 1956 and.
the commentary made by Mulla, 15th Edn.
pages 924 926 as well as Mayne 's on Hindu Law 12th Edition pages 918919.
Shri Banerji relied on the said obser vations of Mayne on 'Hindu Law ', 12th Edn.
at pages 918 919.
This Court observed in the aforesaid decision that the views expressed by the Allahabad High Court, the Madras High Court, the Madhya Pradesh High Court and the Andhra Pradesh High Court appeared to 524 be correct and was unable to accept the views of the Gujarat High Court.
To the similar effect is the observation of learned author of Mayne 's Hindu Law, 12th Edn. page 919.
In that view of the matter, it would be difficult to hold that property which developed on a Hindu under section 8 of the would be HUF in his hand vis a vis his own sons.
If that be the position then the property which developed upon the father of the respondent in the instant case on the demise of his grandfather could not be said to be HUF property.
If that is so, then the appellate authority was fight in holding that the respondent was a licensee of his father in respect of the ancestral house.
But as mentioned hereinbefore, even if we proceed on the assumption that the respondent was a member of the HUF which owned the ancestral house, having regard to his share in the property and having regard to the need of other sons of the father who were living in the ancestral house along with their families, the appellate authority was ,still fight in holding *hat the need of the respondent was bona fide.
The second aspect of the matter which was canvassed before us was that the respondent had purchased another house near Kabir Bhavan in 1971 and there were nine rooms in the said house.
It was the appellant 's contention that it was sold to Smt.
Resham Devi which was a benami transaction.
It was further his contention that in respect of the said house the respondent had got vacant possession.
Thirdly, it was contended that the respondent had within his choice to keep the said premises but he sold the said premises in question.
Therefore he does not come within the conditions stipulated in section 13(3)(a)(i) of the Act.
The appellate authority on appraisal of evidence before the Rent Control ler as well as before it came to the conclusion that vacant possession had not been obtained.
There was evidence on record to come to that conclusion.
Our attention was drawn to the document on behalf of the appellant in support of contention that the document which was registered document recited that vacant possession has been given.
The document stated 'Kabza Khan maken ka dia hai '.
It was asserted that it meant that vacant possession in fact had been given.
The oral evidence adduced indicated otherwise.
Indeed the expression aforesaid does not mean that actual physical vacant possession had been handed over to the purchaser.
In document of this type it can equally mean that the legal right of possession not the actual possession had been handed over to the purchaser.
Therefore, evidence was permissible to explain what it meant.
Reliance for this purpose was placed on a decision of the Division Bench of the Allahabad High Court in Lachhman Das vs Rent Control and Eviction Officer, Bareilly and another.
, AIR [1953] Allahabad 458 at 459, paragarph 6.
Therefore in the instant case even if the legal right of occupation had passed on which, in our opinion, was sought to be conveyed by the expression noted 525 hereinbefore, then whether the premises in question was actually vacant to be occupied by the respondent is a ques tion on which the oral evidence could be adduced.
There was ample justification on the evidence on record to come to the conclusion that it was 'not physically vacant '.
The expres sion noted above therefore on this aspect is really non sequetur and evidence would clinch the issue.
There was the evidence for the appellate authority to come to the conclu sion that the house near Kabit Bhavan was not vacant.
It acted on the same and in our opinion it did not commit any error in so doing.
The next aspect urged was that it was benami transaction because the father of the respondent has gone to the Regis tration office.
In view of the evidence discussed by the appellate authority, specially the income tax records and other records to which it is not necessary to advert in detail as well as the oral testamoney in this case, the appellate authority rejected the contention that the sale was a henami transaction by the respondent.
The most impor tant aspect, however, as was highlighted by the respondent was that the said property was purchased in July, 1971 and sold in August, 1972 because it was not in vacant posses sion.
In the instant case suit for eviction in question for the need of the landlord was filed in January, 1972.
There fore, the respondent could not be said in view of the said premises having been purchased and sold by him prior to the institution of the suit, to have occupied another residen tial building in the urban area.
It was contended that by sale the respondent has disentitled himself to the relief asked for because he had in his choice the residential building for his occupation but he sold it.
We are unable to accept this contention.
There is no evidence either before the Rent Controller or before the appellate authority that this sale to Resham Devi was with an intention or with a purpose to defeat the claim of the appellant or to take out the respondent from the purview of the limitation imposed by clause ( 1 ) (a) of sub section (3) of section 13 of the Act.
If we read in such manner the Act in question, the Act would expose itself to the vice of unconstitutionality.
It is well settled that though the Rent Act.
is a beneficial legislation, it must be read reasonably and justly.
If more limitations are imposed upon the right to hold the property then it would expose itself to the vice of unconstitutional ity.
Such an approach in interpretation of beneficial stat utes is not warranted.
It is true that one should iron out the creases and should take a creative approach as to what was intended by a particular provision but there is always,.
unless rebutted a presumption as to constitutionality and the Act should be so read as to prevent it from being ex posed to the vice of un constitutionality.
State is also presumed to act fairly.
See in this connection the observa tions in State of Karnataka and Another vs M/s. Hans Corpo ration; ; at 704 & 706 and K.P. Varghesev.
Income Tax Officer, Ernakulam and Another, [1981] 4S.C.C. 173 at 179 180 526 Paragraphs 5 & 6).
See also the observations of this Court in Kasturi Lal Lakshmi Reddv vs State of Jammu and Kashmir & Another, ; at 1357.
In fact the respondent did not have a house in his possession.
He purchase one before, but as it was not va cant, he sold away ,,before the institution of the suit.
There was no restriction by the Act on sale and alienation of property.
At the relevant time the respondent fulfilled all the requirements to maintain an action for eviction.
Shri Raja Ram Agarwala, counsel for the respondent, submit ted before us that we should take a creative, reasonable and rational approach in interpreting the statute.
We should not, he submitted, put such an interpretation as would prevent sale or mortgage of the property by the owner and in this case he was justified in saying that the landlord respondent did not have vacant possession.
As the facts of this case warrant and in fact the respondent had sold away the property 1 1/2 years before his suit for his need was instituted, it cannot be said unless there was definite evidence that it was done with the intention to defeat the appellant 's claim so as to be read that the landlord occu pied another residential house at the relevant time i.e. at the time of institution of the suit.
The appellate authority accepted the respondent 's need and found him within the purview of the Act.
The High Court did not interfere in revision, nor shall we under Article 136 of the Constitution.
The appeal, therefore, fails and is accordingly dis missed.
Interim orders are vacated.
In the facts and circum stances of the case, however, the parties will pay and bear their own costs.
M.L.A. Appeal dismissed.

summary:
On 11th October 1971, the respondent landlord purchased a house in which the appellant was a tenant since 1962.
He had also purchased another house in the same district on 10.7.1971 but sold away the same on 7.8.72 as it was not vacant.
On 14th January, 1974, the respondent landlord filed an eviction petition against the appellant tenant inter alia on the ground of bona fide personal requirement.
The Rent Controller rejected the petition holding that all the ingre dients of section 13(3)(a)(i) of the Haryana Urban (Control of Rent and Eviction) Act 1973 had not been proved.
Aggrieved by the order of the Rent Controller, the respondent filed an appeal before the Appellate Authority alongwith an application for adducing additional evidence.
The Appellate Authority allowed the said application, re corded the additional evidence and allowed the appeal, holding that: (i) the need of the respondent was bona fide; (ii) that the vacant possession of the house purchased on the 10th July 1971 by the respondent landlord had not been obtained; and (iii) that the sale of the aforesaid house by the respondent was not a benami transaction.
The High Court dismissed the revision petition of the appellant in limine.
Dismissing the appeal by the appellant to this Court, HELD: 1.1 Section 15 of the Act deals with the powers of the appellate and revisional authorities under the Act.
Sub section
(4) of the said section specifically provides that, if necessary, after further enquiry as it thinks fit.
either personally or through the Controller, the appellate authori ty shall decide the appeal.
Therefore, the appellate author ity has by express provision jurisdiction to admit addition al evidence.
[520E] 517 State of Kerala vs
K.M. Charia Abdullah & Co., ; , relied upon.
1.2 The document relied upon on behalf of the appellant was a registered document and recited that vacant possession has been given.
The document stated 'Kabza Khali makan ka dia hai '.
It was asserted that it meant that a vacant pos session, in fact, had been given.
The oral evidence adduced on behalf of the respondent indicated otherwise.
The expres sion indicated above does not mean that actual physical vacant possession has been handed over to the purchaser.
In a document of this type it can equally mean that the legal right of the possession not the actual possession has been handed over to the purchaser.
Therefore, evidence was per missible to explain what it meant, and there was ample justification on the evidence on record to come to the conclusion that it was 'not physically vacant '.
[524F 525A] In the instant case, admission of additional evidence was warranted by the facts and the pleadings.
By such admis sion of evidence, no prejudice has been caused to the appel lant.
Indeed reading of the order of the appellate authority makes it abundantly clear that the appellate authority had adverted to all the facts recorded by the Rent Controller and further considered the additional evidence.
It is true that in referring to the findings of the Rent Controller, the appellate authority in its order had not specifically referred to the paragraphs of the order of the Rent Control ler but that does not mean nor does it indicate that the appellate authority had not considered evidence adduced before the Rent Controller.
The criticism that there was no consideration of the evidence adduced by the appellant before the Rent Controller by the appellate authority is, therefore, not justified in the facts and circumstances of the case.
[521B E] 2.
Though the Rent Act is a beneficial legislation, it must be read reasonably and justly.
If more limitations are imposed upon the right to hold the property then it would expose itself to the vice of unconstitutionality.
Such an approach in interpretation of beneficial statutes is not warranted.
It is true that one should iron out the creases and should take a creative approach as to what was intended by a particular provision but there is always, unless rebut ted, a presumption as to constitutionality and the Act should be so read as to prevent it from being exposed to the vice of unconstitutionality.
[525F G] In the instant case, the suit for eviction for the need of the landlord was filed in January, 1972.
The respondent could not therefore be said, in view of the above premises having been purchased and sold prior to the institution of the suit, to have occupied another residential building in the urban area.
The 518 contention on behalf of the appellant, that the sale has disentitled the respondent to the relief asked for because he had in his choice the residential building for his occu pation but he sold it, is not maintainable.
There was no evidence either before the Rent Controller or before the appellate authority that this sale of property was with the intention or with a purpose to defeat the claim of the appellant or to take out the respondent from the purview of the limitation imposed by clause (1)(a) of sub s.(3) of section 13 of the Act.
As the respondent had sold the properly 1 1/2 years before his suit for his need was instituted, it cannot be said unless there was definite evidence that it was done with the intention to defeat the appellant 's claim.
The appellate authority accepted the respondent 's need and found him within the purview of the Act.
The High Court did not interfere in revision, nor shall this Court under Article 136 of the Constitution.
[525D F, 526C F] Rani Sartaj Kuari and Another vs Rani Deoraj Kuari, 15 Indian Appeals, 51 in applicable.
State Bank of India vs Ghamandi Ram (Dead) Through Shri Gurbax Rai, ; Sundarsanam Maistri vs Nara simbhulu Maistri and Anr.
, ILR 25 Mad.
149, 154; Commission er of Wealth Tax, Kanpur & Others vs Chander Sen and Others, ; ; Lachhman Das vs Rent Control and Eviction Officer, Bareilly and another AIR 1953 Allahabad 458 at 459, paragraph 6; K.P. Varghese vs 1.
T.O., Ernakulam and Anoth er[1981] 4 SCC 173 at 179 180 & Kasturi Lal Lakshmi Reddy vs State of Jammu and Kashmir & Another ; at 1357 referred to:


judgement:
ivil Appeal No. 4460 of 1986.
From the Judgment and Order dated 16.10.1985 of the Allahabad High Court in Civil Misc.
Writ Petition No. 5440 of 1983.
S.N. Kacker and J.M. Khanna for the Appellant: Anil Dev Singh and Mrs.
Shobha Dikshit for the Respondents.
The appellant is a physically handicapped person.
He has an orthopaedic problem.
He suffers from a permanent impediment of the left leg, the result Of an old compound fracture.
His impediment did not prevent him from good academic performance.
He went further.
He appeared at the combined State Services Examina tion held in February, 1982 by the Uttar Pradesh Public Service Commission.
According to the advertisement issued by Commission, one post in the Provincial Civil Service (Execu tive Branch) was reserved for handicapped persons.
However, the appellant was offered the post of Manager, Marketing and Economic Survey instead of a post in the Provincial Civil Service (Executive Branch).
He was not offered a post in the Provincial Civil Service (Executive Branch) on the ground that the reservation of 2% in the Uttar Pradesh Civil Serv ices for physically handicapped persons had been revoked by the State Government by their letter dated 1.3.
1979 in regard to the Provincial Civil Service (Executive Branch).
Thereupon the appellant filed a Writ Petition under Article 226 of the Constitution in the Allahabad High Court.
The Writ Petition was dismissed by the High Court on the ground that there was no reservation of posts for physically handi capped persons in the Provincial Civil Service (Executive Branch).
The appellant has come before us under Article 136 of the Constitution.
As far back as 1972, the Uttar Pradesh Government by G.O. No. 43/90/66 Apptt. 4 dated July 18, 1972 announced "for the physically handicapped persons, the reservation in all the services under the Government shall be 2%.
" All the Government Departments were directed to follow the policy for reservation in services accordingly.
Latter, by G.O. No. 7/4/1971 Personnel 2 dated May 20, 1978 the Government of Uttar Pradesh while affirming the "reservation of 2% posts for the appointment of disabled persons in all the services under the Government," defined who a physically handicapped person was and added the following instruction: "That in this context, I have to make it clear that the physical disability should not be of the nature which may cause interference in discharge of duties and obligations attached to the concerned service.
Accordingly if the serv ice is as such that it require continuous use of eye, then in such case reservation cannot be given to the blind per sons.
In the same manner if some services specifically involves the hearing faculty then no reservation can be given to the deaf persons in such services and in a service where the use of a particular organ of the body 577 is to be used then the person disabled of that particular organ cannot be given reservation in that service.
On the basis of the principle every department will issue necessary orders regarding reservation for the post under their subor dination.
" It appears that there was some discussion within the department pursuant to a letter from the Public Service Commission and their was a proposal not to reserve any post for disabled persons in the Provincial Civil Service.
This proposal, however, did not result in the issuance of any G.O. by the Government.
But the Public Service Commission was informed by the Government by their letter dated 1.3.
1979 that none of the categories of disabled persons was suitable for appointment to the U.P. Civil Service (Execu tive Branch) and no reservation for disabled persons might be made in the Provincial Civil (Executive Branch) Service.
A perusal of the letter dated 1.3.
1979 indicates that it was confined to "recruitment on the basis of Combined State Services Examination, 1978".
It was not intended to be an amendment of G.O. No. 43/90/66 dated July 18, 1972 or G.O. No. 7/4/1971 dated May 20, 1978.
It was not intended to depart from general rule of reservation of 2% posts in favour of disabled persons in the case of the Provincial Civil Service (Executive Branch).
Again in 1981 the Chief Secretary, Government of Uttar Pradesh addressed all the Secretaries to the Government, Heads of Departments and Commissioners in Uttar Pradesh pointing out that though a provision for reservation of 2% posts was made for physical ly handicapped persons by G.O. No. 43/90/ 66 dated July 18, 1972 in the services under the State Government, appoint ments had not been made of handicapped persons in accordance with the reservation.
The necessity of making appointments of physically handicapped persons to the reserved posts was impressed upon all the Secretaries, Heads of Departments and Commissioners.
and it was particularly brought to their attention that 1981 had been declared as 'the International Year for the Physically Handicapped Persons '.
It was also directed that vacancies should be carried forward and ef forts should be made to ensure that the maximum number of physically handicapped persons were appointed.
In the face of this communication from the Chief Secretary, we think that it is now futile for the Government to contend that the appellant cannot be appointed to the Provincial Civil Serv ice (Executive Branch).
Having announced their determina tion, very rightly too in our opinion, to rehabilitate physically handicapped persons, by reserving posts for them in all the services of the Government, the Government cannot now create needless hurdles.
The State Civil Service (Execu tive Branch) is a large enough service which can easily accommodate physically handicapped 578 persons in suitable posts.
A direction will, therefore, be issued to the Government of Uttar Pradesh to appoint the appellant to the Uttar Pradesh Civil Service (Executive Branch) with effect from the date on which he should have been appointed in the ordinary course.
He will be entitled to all the other service benefits.
He is also entitled to costs.
The appeal is allowed accordingly.
S.R. Appeal allowed.

summary:
As far back as 1972, the Uttar Pradesh Government by G.O. No. 43/90/66 Apptt. 4 dated July 18, 1972 announced "for the physically handicapped persons, the reservation in all the services under the Government shall be 2%".
AH the Government Departments were directed to follow the policy for reservation in services accordingly.
Later, by G.O. No. 7/4/1971 Personnel 2 dated May 20, 1978 the Government of Uttar Pradesh while affirming the "reservation of 2% posts for the ' appointment of disabled persons in all the services under the Government", defined who a physically handicapped person was.
Pursuant to a letter from the Public Service Commission there was a proposal not to reserve any post for disabled persons in the Provincial Civil Service.
This proposal, however, did not result in the issuance of any G.O. by the Government.
But the Public Service Commission was informed by the Government by their letter dated 1.3.1979 that none of the categories of disabled persure was suitable for appointment to the U.P. Civil Service (Execu tive Branch) and no reservation for disabled persons might be made in the Provincial Civil (Executive Branch) Service.
In 1981 the Chief Secretary, Government of Uttar Pradesh addressed all the Secretaries to the Government, Head of Department and Commissioners in Uttar Pradesh pointing out that though a provision for reservation of 2% posts was made for physically handicapped persons by G.O. No. 43/90/66 dated July 18, 1972 in the services under the State Govern ment, appointments had not been made of handicapped persons in accordance with the reservation.
The necessity of making appointments of physically handicapped persons to the re served posts was impressed upon all the Secretaries, Heads of Departments and Commissioners and it was particularly brought to their attention that 1981 had been declared as "the International Year for 575 the physically Handicapped Persons '.
It was also directed that vacancies should be carried forward and efforts should be made to ensure that the maximum number of physically handicapped persons were appointed.
The appellant, a disabled person who was successful at the combined State Services Examination held in 1982 by the Uttar Pradesh Public Service Commission was offered the post of Manager Marketing and Economic Survey instead of a post in the Provincial Civil Service (Executive) Branch on the ground that the reservation of 2% to the disabled persons had been revoked by the Government letter dated 1.3.1979.
The Writ Petition filed by the appellant was dismissed by the Allahabad High Court.
Hence the appeal by special leave.
Allowing the appeal, the Court.
Held: A perusal of the letter dated 1.3.1979 indicates that it was confined to "recruitment on the basis of Com bined State Services Examination, 1978".
It was not intended to be an amendment of G.O. No. 43/90/66 dated July 18, 1972 or G.O. No. 7/4/1971 dated May 20, 1978.
It was not intended to depart from general rule of reservation of 2% posts in favour of disabled persons in the case of the Provincial Civil Service (Executive Branch).
Further in the face of the communication in 1981 by the Chief Secretary drawing atten tion of all departments to the G.O. 1972, it is now futile for the Government to contend that the appellant cannot be appointed to the Provincial Civil Service (Executive Branch).
Having announced very rightly their determination to rehabilitate physically handicapped persons, by reserving posts for them in all the services of the Government, the Government cannot now create needless hurdles.
[577C H]


judgement:
Civil Appeal No. 3165 of 1981.
From the Judgment and Order dated 20.11.1980 of the Delhi High Court in Writ Petition No. 1632 of 1980.
949 M.K. Ramamurthy, M.A. Krishnamurthy and Miss Kuttu Bansilal for the Appellant.
N.C. Talukdar and M.C. Thinner for the Respondents.
The Judgment of the Court was delivered by SEN, J.
The short point involved in this appeal by special leave from a judgment and order of the Delhi High Court dated November 20, 1980 dismissing in limine the writ petition filed by the appellant, is whether the appellate Order passed by the Director General, Border Roads Organisation dated October 14, 1980, is in conformity with the requirements of r. 27(2) of the Central Civil Services (Classification, Control & Appeal) Rules, 1965 ( 'Rules ' for short) which have been made applicable to the personnel of the Border Roads Organisation.
The facts are that the appellant was appointed as Supervisor (Barracks & Stores) Grade I attached to 60 Road Construction Company, General Reserve Engineering Force on probation for a period of two years by an order dated July 7, 1976.
Before the expiry of the probationary period, the Chief Engineer (project) Dante by an order dated June, 24, 1978 terminated the services of appellant.
The order of termination however could not be served on the appellant as he absented himself without leave.
Thereupon, the Officer commanding by a movement order dated June 27, 1978 transferred the appellant to 19 Border Roads Task Force.
On July 1, 1978 the Officer Commanding forwarded the order of termination issued by the Chief Engineer, but on representation by the appellant, the Director General, Border Roads Organisation by order dated November 17, 1978 cancelled the order of termination presumably on a misapprehension that the period of probation having expired, no order of termination could be made.
He however directed the taking of disciplinary action against the appellant as a deserter since he had absconded from service to evade the service of the order of termination.
After a regular departmental inquiry, the appellant was served with a show cause notice under Article 311 (2) of the Constitution and after considering the representation made by him, the Chief Engineer (Project), Dante imposed on the appellant the punishment of removal from service in exercise of the powers conferred by r. 12 read with r. 11(VIII) of the Rules with effect from 950 June 10, 1980.
Against the order of removal, the appellant preferred an appeal under r. 23 of the Rules before the Director General, Border Roads Organisation.
The Director General by the impugned order dismissed the appeal observing: "After thorough examination of the facts brought out in the appeal, the DGBR is of the opinion that the punishment imposed by the CE (P) DANTAK vide his Order No. 10527/762/EIB dated 24 June 78 was just and in accordance to the Rules applicable.
He has accordingly rejected the appeal.
" Having heard the parties, we are satisfied that in disposing of the appeal the Director General has not applied his mind to the requirements of r. 27(2) of the Rules, the relevant provisions of which read as follows: "27(2).
In the case of an appeal against an order imposing any of the penalties specified in Rule 11 or enhancing any penalty imposed under the said Rules, the appellate authority shall consider.
(a) whether the procedure laid down in these rules has been complied with and if not, whether such noncompliance has resulted in the violation of any provisions of the Constitution of India or in the failure of justice; (b) whether the findings of the disciplinary authority are warranted by the evidence on the record; and (c) whether the penalty or the enhanced penalty imposed is adequate, inadequate or severe; and pass orders (i) confirming, enhancing, reducing or setting aside the penalty; or (ii) remitting the case to the authority which imposed or enhanced the penalty or to any other authority with such direction as it may deem fit in the circumstances of the case.
" 951 The word 'consider ' in rule 27 (2) implies due application of mind '.
It is clear upon the terms of r. 27(2) that the appellate authority is required to consider (1) whether the procedure laid down in the Rules has been complied with; and if not, whether such non compliance has resulted in violation of any provisions of the Constitution or in failure of justice; (2) whether the findings of the disciplinary authority are warranted by the evidence on record; and (3) whether the penalty imposed is adequate; and thereafter pass orders confirming, enhancing etc.
the penalty, or may remit back the case to the authority which imposed the same.
Rule 27(2) casts a duty on the appellate authority to consider the relevant factors set forth in cls.
(a), (b) and (c) thereof.
There is no indication in the impugned order that the Director General was satisfied as to whether the procedure laid down in the Rules had been complied with; and if not, whether such noncompliance had resulted in violation of any of the provisions of the Constitution or in failure of justice.
We regret to find that the Director General has also not given any finding on the crucial question as to whether the findings of the disciplinary authority were warranted by the evidence on record.
It seems that he only applied his mind to the requirement of cl.
(c) of r. 27(2), viz. whether the penalty imposed was adequate or justified in the facts and circumstances of the present case.
There being non compliance with the requirements of r. 27(2) of the Rules, the impugned order passed by the Director General is liable to be set aside.
It is not the requirement of article 311(2) of the Constitution of India or of the Rules of natural justice that in every case the appellate authority should in its order state its own reasons except where the appellate authority disagrees with the findings of the disciplinary authority.
In State of Madras vs A.R. Srinivasan, a Constitution Bench repelled the contention that the State Government 's order compulsorily retiring the delinquent from service was bad as it did not give reasons for accepting the findings of the inquiring tribunal and observed as follows: "Mr. Setalvad for the respondent attempted to argue that the impugned order gives no reasons why the appellant accepted the findings of the Tribunal.
Disciplinary 952 proceedings taken against the respondent, says Mr. Setalvad, are in the nature of quasi judicial proceedings and when the appellant passed the impugned order against the respondent, it was acting in a quasi judicial character.
That being so, the appellant should have indicated some reasons as to why it accepted the findings of the Tribunal; and since no reasons are given, the order should be struck down on that ground alone.
We are not prepared to accept this argument.
In dealing with the question as to whether it is obligatory on the State Government to give reasons in support of the order imposing a penalty on the delinquent officer, we cannot overlook the fact that the disciplinary proceedings against such a delinquent officer begin with an enquiry conducted by an officer appointed in that behalf.
That enquiry is followed by a report and the Public Service Commission is consulted where necessary.
Having regard to the material which is thus made available to the State Government and which is made available to the delinquent officer also, it seems to us somewhat unreasonable to suggest that the State Government must record its reasons why it accepts the findings of the Tribunal.
It is conceivable that if the State Government does not accept the findings of the Tribunal which may be in favour of the delinquent officer, and propose to imposes a penalty on the delinquent officer, it should give reasons why it differs from the conclusions of the Tribunal, though even in such a case, it is not necessary that the reasons should be detailed or elaborate.
But where the State Government agrees with the findings of the Tribunal which are against the delinquent officer, we do not think as a matter of law, it could be said that the State Government cannot impose the penalty against the delinquent officer in accordance with the findings of the Tribunal unless it gives reasons to show why the said findings were accepted by it.
The proceedings are, no doubt, quasi judicial; but having regard to the manner in which these enquiries are conducted, we do not think an obligation can be imposed on the State Government to record reasons in every case.
In Som Datta Datta vs Union of India & Ors, a Constitution Bench of this court rejected the contention that the order of the Chief 953 of the Army Staff confirming the proceedings of the Court Martial under section 164 of the Army Act and the order of the Central Government dismissing the appeal of the delinquent under sec.
165 of the Army Act were illegal and ultra vires as the did not give reasons in support of the orders, and summed up the legal position as follows: "Apart from any requirement imposed by the statute or statutory rule either expressly or by necessary implication, there is no legal obligation that the statutory tribunal should give reasons for its decision.
There is also no general principle or any rule of natural justice that a statutory tribunal should always and in every case give reasons in support of its decision.
" To the same effect is the decision in Tara Chand Khatri vs Municipal Corporation of Delhi & Ors.
Accordingly, the appeal must succeed and is allowed.
The impugned order passed by the Director General, Border Roads Organization is set aside and he is directed to dispose of the appeal afresh after applying his mind to the requirements of r. 27(2) of the Central Civil Services (Classification, Control & Appeal) Rules, 1965, with advertence to the points raised by the appellant in his petition of leave.
There shall be no order as to costs.
N.V.K. Appeal allowed.

summary:
The Central Civil Services (Classification, Control and Appeal) Rules 1965 by Rule 27 casts a duty on the Appellate Authority in the case of an appeal against an order imposing any of the penalties specified in Rule 11 to consider: (a) whether the procedure laid down in the rules has been complied with: and if not, whether such non compliance has resulted in violation of any of the provisions of the Constitution or in the failure of justice (b) whether the findings of the disciplinary authority are warranted by the evidence on record; and (c) whether the penalty imposed is adequate and thereafter pass orders confirming, enhancing etc.
the penalty, or remit back the case to the authority which imposed the same.
The appellant was appointed as Supervisor in the Border Roads Organisation on probation for a period of two years.
Before the expiry of the probation period, the Chief Engineer terminated this services.
The order of termination however could not be served as the appellant absented himself without leave.
He was later transferred and the Officer Commanding forwarded the order of termination to him.
On his representation the Director General cancelled the order of termination on a misapprehension that the period of probation having expired no order of termination could be made.
He, however, directed that the taking of disciplinary action against him as a deserter since he had absconded from service to evade service of the termination order.
After a regular departmental enquiry, he was served with a show cause notice under article 311(2) of the Constitution and after consideration of his representation, the Chief Engineer imposed the punishment of removal from service under Rule 12 read with Rule 11 of the Central Civil Services (Classification, Control and Appeal) Rules 1965.
948 The appeal under Rule 23 of the Rules preferred by the appellant was dismissed by the Director General observing, that 'after thorough examination of the facts brought out in the appeal, the punishment imposed upon the appellant was just and in accordance with the rules '.
The writ petition having been dismissed in limine the appellant appealed by special leave to this court.
Allowing the appeal ^ HELD: The word 'consider ' in Rule 27(2) implies 'due application of mind '.
[951A] In the instant case, there is no indication in the order that the Director General was satisfied as to whether the procedure laid down in the Rules had been complied with.
No finding has been given on the crucial question as to whether the findings of the disciplinary authority were warranted by the evidence on record.
[951C] 2.
The Director General only applied his mind to the requirement of clause (c) of Rules 27(2) viz. whether the penalty imposed was adequate or justified in the facts and circumstances of the case.
Rule 27(2) casts a duty on the appellate authority to consider the relevant factors set forth in clauses (a), (b) and (c) thereof.
[951E] 3.
There being non compliance with the requirements of Rule 27(2) of the Rules, the order passed by the Director General is set aside.
He is directed to dispose of the appeal afresh after applying his mind to the requirements of Rule 27(2) of the Rules.
[951E; 953E] 4.
It is not the requirement of article 311(2) of the Constitution of India or of the Rules of natural justice that in every case the appellate authority should in its order state its own reasons except where the appellate authority disagrees with the findings of the disciplinary authority.
[951F] State of Madras vs A.P. Srinivasan, AIR 1966 SC 1827; Som Datt Datta vs V.O.I. and Ors.
and Tara Chand Khatri v, Municipal Corporation of Delhi and Ors., AIR 1977 SC 567, referred to.