judgement:
Civil Appeal No. 2522 of 1969.
From the Judgment and Order dated 12 5 1969 of the Punjab and Haryana High Court in L.P. No. 8/69.
Ravindra Bana and M. N. Shroff for the Appellant.
T. section Arora and M. L. Lahoty for the Respondent.
The Judgment of the Court was delivered by SHINGHAL, J.
One Nathi held 36 standard acres and 8 standard units of land in village Bhanguri, and as the "permissible area" within the meaning of clause (3) of section 2 of the Punjab Security of Land Tenures Act, 1953, (hereafter referred to as the Act) in his case was 30 standard acres, Collector (Surplus) Nuh, declared 6 standard acres and 8 standard units of land as "surplus area", by his order dated November 25, 1959.
Nathi died on July 14, 1965, leaving his widow Smt.
Kela Devi respondent No. 1, and his mother Smt.
Mando respondent No. 2, as heirs.
The two heirs made an application under sections 10 A(b) and 10B of the Act stating that as the land of Nathi had been inherited by them in equal shares, and the holding with each one of them was much below the "permissible area" of 30 standard acres, there was no "surplus area" within the meaning of clause (5 a) of section 2 of the Act and no part of it could therefore be utilized for allotment to other tenants.
That application was however dismissed by Collector (Surplus) on March 13, 1967, on the ground that the "surplus area" declared in Nathi 's life time had already been allotted to other tenants and could not be excluded from the holding in the hands of his widow and mother.
An appeal was taken to the Commissioner of Ambala, but it was dismissed on January 30, 1968, as he took the view that the order of allotment of the "surplus area" of Nathi 's holding amounted to "utilisation" of that land under section 10 A(a).
A revision was taken to the Financial Commissioner, but it was rejected on May 8, 1968, for the same reason.
Kela Devi and Smt.
Mando then approached the High Court of Punjab and Haryana by a writ petition under articles 226 and 227 of the Constitution.
It was opposed by the present appellants on the ground 1122 that as the "surplus area" had been declared and allotted to various tenants during the life time of Nathi (except for an area of 8 kanals in village Ghelab) the writ petitioners were not entitled to succeed, as the "surplus area" had already been utilized.
It was also pleaded that possession of eight pieces of land had already been delivered to the tenants before the death of Nathi.
The controversy before us does not relate to those pieces of land which had been allotted to various tenants and of which possession was given to them during the life time of Nathi.
The learned Single Judge of the High Court who initially heard the writ petition allowed it by his judgment dated October 29, 1968, in so far as it related to the portion of land of which possession had not been given to other tenants and, to that extent, he set aside the above mentioned orders of the Collector, the Commissioner, and the Financial Commissioner by which the application of Smt.
Kela Devi and Smt.
Mando was rejected.
An appeal was taken to a Division Bench of the High Court, but it was dismissed on May 12, 1969.
That is why the present appeal has been filed on the basis of the High Court 's certificate under Article 133 (1)(c) of the Constitution.
The only question which therefore arises for consideration is whether the High Court was right in taking the view that mere allotment of land to other tenants under section 10 A(a) of the Act did not amount to utilisation of the "surplus area" when the resettled tenants had not taken possession under the allotment orders.
It is not in controversy that it had been finally decided that the "surplus area" in the case of Nathi was 6 standard acres and 8 standard units, and a decision to that effect was taken in his life time on November 25, 1959.
It is also not in dispute that orders were made for the allotment of the "surplus area" to other tenants under section 10 A(a) of the Act which reads as follows "10 A(a) The State Government of any officer empowered by it in this behalf shall be competent to utilize any surplus area for the resettlement of tenants ejected, or to be ejected, under clause (i) of sub section (1) of section 9.
" While therefore the section empowers the State Government or its authorised officer to "utilise" any "surplus area" for the resettlement of tenants, the Act does not define what is meant by an order of utilisation under the section.
A clue to what is actually meant by that expression, is however to be found in clause (b) of section 10 A which provides as follows, 1123 "10 A(b) Notwithstanding anything contained in any other law for the time being in force and save in the case of land acquired by the State Government under any law for the time being in force or by an heir by inheritance no transfer or other disposition of land which is comprised in surplus area at the commencement of this Act, shall affect the utilization thereof in clause (a).
" The clause therefore has the effect of saving the land comprised in the "surplus area", if it has been acquired by an heir by inheritance.
So where an heir succeeds by inheritance, as in this case, that basic fact would affect the utilisation of the surplus area even if only an order has been made under clause (a) of section 10 A for its utilisation for the resettlement of other tenants but that order has not been implemented.
In order to understand the full meaning and effect to the provisions of section 10 A, it is necessary to make a cross reference to rules 18, 20 A, 20 B and 20 C of the Punjab Security of Land Tenures Rules, 1956 (hereafter referred to as the Rules).
Rule 18 deals with the procedure for allotment of "surplus area" to other resettled tenants.
Rule 20 A provides for the issue of certificates of allotment of lands to them, and rule 20 B provides for delivery of possession and makes it obligatory for the resettled tenant to take possession of the land allotted to him within a period of two months or such extended period as may be allowed by the officer concerned.
Rule 20 C provides, inter alia, for the execution of a "qabuliyat" or "patta" by a resettled tenant.
It would thus appear that while allotment of land is an initial stage in the process of utilisation of the "surplus area", it does not complete that process as it is necessary for the allottee to obtain a certificate of allotment, take possession of the land within the period specified for the purpose, and to execute a "qabuliyat" or "patta" in respect thereof.
The process of utilisation contemplated by section 10 A of the Act is therefore complete, in respect of any "surplus area", only when possession thereof has been taken by the allottee or the allottees and the other formalities have been completed, and there is no force in the argument that a mere order of allotment has the effect of completing that process.
Reference in this connection may also be made to rule 20 D of the Rules which provides that in case a tenant does not take possession of the "surplus area" allotted to him for resettlement within the period specified therefor, the allotment shall be liable to be cancelled and the area allotted to him may be utilized for the resettlement of 1124 another tenant.
It cannot therefore be dobted that a completed title does not pass to the allottee on a mere order of allotment, and that order is defeasible if the other conditions prescribed by law are not fulfilled.
So when the process of utilisation of Nathi 's "surplus area" had not been completed by the time his heirs by inheritance made the aforesaid application to the authorities concerned, it was permissible for those authorities to re examine the question whether there was any "surplus area" at all after Nathi 's holding had been inherited by his two heirs in equal shares so as to reduce the area of the holding of each one of them below the permissible area.
The High Court therefore rightly allowed the writ petition of the respondents.
As there is no force in this appeal, it is dismissed but, in the circumstances, we do not make any order as to the costs.
P.B.R. Appeal dismissed.

summary:
Out of 46 odd acres of land held by the original owner (husband of respondent No. 1 and son of respondent No. 2), the Collector declared six odd acres as surplus area under section 2(3) of the Punjab Security of Land Tenures Act, 1953 and allotted them to two other tenants.
On the death of the original owner the two heirs (respondents 1 and 2) made an application stating that since the land inherited by each of them in equal shares was below the permissible area of 30 standard acres, there was no surplus area with them and that, therefore, no part of the land could be utilized for allotment to other tenants.
The Collector rejected their application on the ground that the surplus area having been declared during the life time of the original owner, it could not be excluded from the holding in the hands of the two respondents.
The respondents failed in appeal and revision before the Commissioner and the Financial Commissioner.
A single Judge of the High Court allowed their petition under Articles 226 and 227 of the Constitution in so far as it related to the application of the land of which possession had not been given to the other tenants.
A Division Bench rejected the appellants appeal.
On the question whether mere allotment of land to other tenants amounted to utilization of the surplus area when the re settled tenant had not taken possession.
Dismissing the appeal, ^ HELD: 1.
While section 10A(a) of the Act empowers the State Government to utilize any surplus area for re settlement of tenants, the Act does not define what is meant by order of utilization under the section.
Clause (b) of the section, however, has the effect of saving the land comprised in the surplus area if it has been acquired by an heir by inheritance.
Therefore, when an heir succeeds by inheritance that basic fact would affect the utilization of the surplus area, even if an order had been made under section 10A(a) for its utilization for the resettlement of other tenants but that order had not been implemented.
[1122H, 1123A B] 2.
A conspectus of the rules made under the Act also shows that while allotment of land is an initial stage in the process of utilization of the surplus area, it does not complete that process as it is necessary for the allottee to obtain a certificate of allotment, take possession of the land within the specified period and execute necessary documents thereafter.
A mere order of allotment does not have effect of completing that process.
Rule 20D also points to the con 1121 clusion that a completed title does not pass to the allottee on a mere order of allotment and that order is defeasible if the other conditions prescribed by law are not fulfilled.
[1123 F G] In the instant case since the process of utilization of surplus area had not been completed by the time the heirs made the application it was permissible for the authorities to re examine the question whether there was any surplus area at all after the heirs had inherited the land in equal shares so as to reduce the area of the holding of each one of them below the permissible area.
[1124 B G]


judgement:
N: Criminal Appeal No. 286 of 1973.
Appeal by Special Leave from the Judgment and Order dated 16 5 1973 of the Orissa High Court in Crl.
Revision No. 645 of 1972.
AND CIVIL APPEAL No. 2036 of 1973 Appeal by Special Leave from the Judgment and Order dated 6 3 1973 of the orissa High Court in O.J.C. No. 491/72.
J. L. Jain and Mrs. section Gopalakrishnan for or the Appellants.
G. Dass, Mrs. section Bhandare and A. N. Karkhanis for the Respondent.
The Judgment of the Court was delivered by KOSHAL, J.
By this judgment we shall dispose of Civil Appeal No. 2036 of 1973 and Criminal Appeal No. 286 of 1973, both of which have arisen from a dispute over a single piece of land and the facts leading to which may be briefly stated.
Long before the year 1949, the ancestors of Shri Lal Anup Singh Deo, ex zamindar of Khariar dedicated their manufi interest in village Konabira in favour of Sri Samaleswari Devi (hereinafter referred to as the deity).
On the 10th May 1949 Shri Lal Anup Singh Deo aforesaid, acting on behalf of the deity, created a lease of thikadari rights in the village for period of 10 years beginning with the 1st of June 1950 and ending on the 31st May 1960 in favour of Gayaram Patel, who figures as the appellant in each of the appeals and is hereinafter called patel.
The deed of lease appears at pages 5 and 6 of the paper book in Civil Appeal No. 2036 of 1973 and describes Patel thus: "Gayaram Patel son of Bisram Patel, the legal guardian of gaontia thikadari patta" The terms on which the lease was granted to Patel are reproduced below : (i) That the yearly rent payable shall be Rs. 109/ to be paid before January of every year.
322 (ii) That in case of non payment the lease is liable to be cancelled.
(iii)That all the repairs, upkeep and development works should be executed and for such works no compensation can be claimed.
All the repairs, maintenance of tanks, garden, buildings, etc., shall be carried out at your responsibility.
(iv) That no injustice should be done to the community in maintaining the abovementioned works.
(v) That no transfer is permissible in respect of the property.
(vi) That the property is to be maintained for the exclusive welfare of the community with the help, directions, orders and co operation of the Estate Officer.
(vii)That the rules and regulations for forest lands are to be obeyed.
(viii)That the cultivable lands cannot be utilised for any other purpose, nor can they be transferred or sold or otherwise dealt with to the hardship of the villagers or the tenants.
If any land is abandoned and (?) takes a new land for cultivation he will be liable under the law and be subjected to the payment of the usual rent.
The lease was acted upon and while it was in force, the orissa Estates Abolition Act, 1951 (hereinafter called the Abolition Act) was promulgated.
The object of that Act was to abolish all intermediaries and rent receivers, to vest their interest in the State, and to establish a direct relationship between the State and the tillers of the soil.
Section 3A of the Abolition Act authorised the State Government to declare by notification that such interests have passed to and become vested in the State free from all encumbrances.
A notification of that type was issued by the State Government and became effective from the 1st of June 1959.
In the meantime a Board of Trustees had been appointed under the Orissa Hindu Religious Endowments Act, 1951 (for short Endowments Act) with Shri Kailash Chandra Panigrahi as the Managing Trustee to look after the affairs of the deity on whose behalf an application under section 7 read with section 8 A(1) of the Abolition Act was made by the Managing Trustee after the said 323 notification had come into force.
It was claimed in the application that the deity was in "Khas possession" of certain lands in village Konabira and prayed that the same, be settled on it as an occupancy tenant.
The application was resisted by Patel who claimed that it was he and not the deity who enjoyed the "Khas possession" of the said land.
The application was decided by the Tehsildar Khariar, Tehsil Nawapara, acting as Collector under the Abolition Act.
He held that Patel was in "Khas possession" of only one plot of land which was designated by No. 5 and had an area of 20.14 acres but that such possession was held by him on behalf of the deity and not on his own account.
In this view of the matter he passed the order dated 13th June 1962, the operative part of which runs thus: "Sir lands in village Konabira bearing plot No. 5 with an area of 20.14 acres are settled on occupancy rights with Gayaram Patel s/o Bisram Patel, ' of Konabira, P. section Komna Distt.
Kalahandi for and on behalf of Samaleswari Devi of Kemna, the Maufidar, u/s 7(1) (b) of the Orissa Estates Abolition Act, 1951.
A fair and equitable annual rent of Rs. 6.75 np.
is determined from the date of vesting release rent from 1959 60 onwards.
" On the 21st of October 1963, the Managing Trustee of the deity made an application to the Assistant Commissioner of Endowments under section 68 of the Endowments Act complaining that he had been resisted by Patel in obtaining possession of the land of the deity and praying for recovery of possession thereof from Patel.
In his order dated the 12th of January 1970, the Assistant Commissioner of Endowments allowed the application holding that it was the deity and not Patel who had been declared to be the occupancy tenant in the order dated 13th June 1962 abovementioned.
Patel went up in revision to the Commissioner of Endowments but without success and thereafter knocked at the door of the orissa High Court with a petition under Articles 226 and 227 of the Constitution of India seeking to have the orders of the Assistant Commissioner of Endowments and the Commissioner of Endowments set aside.
The High Court however took the same view of the matter as was expressed by authority appointed under the Endowments Act and negatived the contentions raised on behalf of Patel, in its order dated 6th March 1973.
It is that order which is challenged before us in Civil Appeal No. 2036 of 1973 instituted by special leave.
In the meantime litigation had started between the deity and Patel on the criminal side also.
Claiming that the deity had recovered 324 possession of plot No. 5 abovementioned (which had by then come to be designated by No. 15 and to have an area of 22.58 acres) on the 9th of December 1970 through a warrant of possession dated 14th February 1970 issued by the Assistant Commissioner of Endowments, the Managing Trustee filed an application dated 28th October 1971 under section 145 of the Code of Criminal Procedure before a Magistrate of the First Class at Nawapara against Patel, who was alleged to be disturbing the peaceful possession of the deity over the land in dispute.
A Preliminary order attaching the property was passed by the Magistrate on the same day, i.e., 28th October 1971.
That order was however cancelled and the proceedings were dropped on the 15th November 1971 in pursuance of a report dated 6th November 1971 made by the officer incharge of the Police Station, Komna (within the territorial limits of which lay the land in dispute) to the effect that there was no apprehension of a breach of peace by the parties.
Nevertheless, on the 20th November 1971, another report was received by the Magistrate from the same officer revealing "an emergency" whereupon the Magistrate made a direction that the preliminary order dated 28th October 1971 be given effect to and that the land be attached along with the crops standing thereon.
Ultimately, the proceedings were finalised through an order dated 21st September 1972 passed by the Magistrate who held that it was Patel who was in possession of the land in dispute on the 20th November 1971, and directing that the land be restored to him.
Aggrieved by the order of the Magistrate the Managing Trustee or the deity went up in revision to the High Court, a learned Single Judge of which set aside the same and directed delivery of possession of the land to the deity on the basis of the findings given below: (1) The proceedings had terminated on the 15th November 1971 and the Magistrate has no jurisdiction to revive them five days later and to give effect to the order of attachment which already stood vacated.
(2) There had been a civil suit and a writ application in respect of the land which has terminated in favour of the deity.
(3) The matter had been taken up by the Endowments Department which had delivered all properties to the deity before the 29th April 1970.
It is this order of the High Court which is impugned in Criminal Appeal No. 286 of 1973 by special leave of this Court.
325 2.
In order to appreciate the rival contentions of learned counsel for the parties it is necessary to make a reference to the relevant provisions of the Abolition Act and to determine the party in whom the occupancy tenancy vests under section 7 thereof.
As already pointed out the object of the Abolition Act was to do away with all intermediaries and rent receivers and to establish a direct relationship between the State and the actual tillers of the soil.
The preamble of the Act states: "Whereas in pursuance of the Directive Principles of State Policy laid down by the Constitution of India it is incumbent on the State to secure economic justice for all and to that end to secure the ownership and control of all material resources of the community so that they may best subserve the common good, and to prevent the concentration of wealth and means of production to the common detriment; "AND WHEREAS in order to enable the state to discharge the above obligation it is expedient to provide for the abolition of all the rights, title and interest in land of Intermediaries by whatever name known, including the mortgagees and lessees such interest, between the raiyat and the State of Orissa for vesting in the said State of the said rights, title and interest and to make provision for other matters connected with;. " Section 2 contains definitions.
Clauses (f), (g), (h), (hh) and (j) thereof are relevant to the dispute and are extracted below: (f) "date of vesting" means in relation to an estate vested in the State the date of publication in the Gazette of the notification under sub section (1) of section 3 or sub section (1) of section 3 A in respect of such estate and in the case of surrender by an intermediary under section 4 the date of the execution of the agreement; (g) `estate ' includes a part of an estate and means any land held by or vested in an Intermediary and included under one entry in any revenue roll or any of the general registers of revenue paying lands and avenue free lands, prepared and maintained under the law relating to land revenue for the time being in force or under any rule, order, custom or usage having the force of law, and includes revenue free 326 lands not entered in any register or revenue roll and all classes of tenures or under tenures and any Jagir, inam or maufi or other similar grant; (h) `Intermediary ' with reference to any estate means a proprietor, sub proprietor, landlord, landholder, malguzar, thikadar, gaontia, tenure holder, under tenure holder, and includes an inamdar, a jagirdar, Zamindar, IIaquadar, Khorposhdar, Parganadar, Sarbarakar and Maufidar including the Ruler of an Indian State merged with the State of Orissa and all other holders or owners of interest in land between the raiyat and the State; (hh) `Intermediary interest ' means an estate or any rights or interest therein held or owned by or vested in an Intermediary and any reference to `state ' in this Act shall be construed as including a reference to `intermediary interest ' also; (j) "Khas possession" used with reference to the possession of an Intermediary of any land used for agricultural or horticultural purposes, means the possession of such intermediary by cultivating such land or carrying on horticultural operations thereon himself with his own stock or by his own servants or by hired labour or with hired stock; The provisions of section 3A have already been noted.
Then comes section 7 which is all important for the purpose of resolving the present dispute.
It states: "7.
(1) on and from the date of vesting (a) all lands used for agricultural or horticultural purposes which were in Khas possession of an Intermediary on the date of such vesting, (b) lands used for agricultural or horticultural purposes and held by a temporary lessee or lessees of an Intermediary who owns either as Intermediary or in any other capacity less than thirty three acres of land in total extent situated within the State, (c) lands used for agricultural or horticultural purposes and in possession of a mortgagee, which immediately before the execution of the mortgage bond were in Khas possession of such intermediary, 327 . . . . . . . . . . . . . . . shall, notwithstanding anything contained in this Act, be deemed to be settled by the State Government with such Intermediary and with all the share holders owning the estate and such Intermediary with all the share holders shall be entitled to retain possession thereof and hold them as raiyats under the State Government having occupancy rights in respect of such lands subject to the payment of such fair and equitable rent as may be determined by the Collector in the prescribed manner: . . . . . . . . . . . . . " Sub section (1) of section 8A requires Intermediaries to file their claims in the prescribed manner for settlement of fair and equitable rent in respect of land and buildings, which are deemed to be settled with them under section 6 or section 7, before the Collector within the specified period.
It would be seen that clauses (a), (b) and (c) of sub section (1) of section 7 protect certain Intermediaries and thus form exceptions.
to the scheme of the Act which, generally speaking, conforms to the object detailed in the preamble.
In the present case we are not concerned with clause (c).
According to learned counsel for Patel his case falls within the ambit of clause (a).
It is claimed on his behalf that he was not merely a lessee or a temporary lessee under the deity but was a thikadar and, therefore, himself an Intermediary within the meaning of the definition of that word occurring in clause (h) of section 2 and that he being in "Khas possession" of the land in dispute on the date of vesting was an Intermediary described in clause (a).
On the other hand, for the deity it is argued that Patel was granted only a temporary lease in 1949, that he did not have any status better than that of a lessee, temporary or otherwise, and that therefore his case was covered by clause (b) and not clause (a) so that it was he deity who was entitled to be regarded as the occupancy tenant on and from the date of vesting.
The whole controversy thus turns round the position which Patel came to hold in respect of the land in dispute under the lease deed of 1949 and in order to assess that position it is necessary to refer to the lease deed dated 10th May 1949.
As noted earlier that deed itself describes Patel as "gaontia thikadari patta".
Learned counsel for the deity has contended that 328 this description is really not correct and that the conditions of the lease clearly make out a case of Patel being inducted into the land as an ordinary lessee who was to till the land against payment of rent.
The contention does not appear to us to have any force.
Apart from the description of Patel as "gaontia thikadari patta" the deed contains a sure indication of the nature of the tenure granted in condition (8) which states specifically: "That the cultivable lands cannot be utilised for any other purpose, nor can they be transferred or sold or otherwise dealt with to the hardship of the villagers or the tenants.
. . . . . . . . . . . . . . " The reference to tenants is of considerable significance and points to land being under the cultivation of persons other than Patel at the moment the lease was granted.
This state of affairs is incompatible with the grant of an ordinary lease to Patel.
The tenure granted in his favour was on the other hand one conferring on him a right to collect the rents from the tenants of the deity and in lieu thereof pay a fixed sum of Rs. 109/ per annum to it so that he was correctly described in the lease deed as a gaontia or thikadar, both of which expressions describe an Intermediary as distinguished from a raiyat or an actual tiller of the soil.
Once Patel is found to be an Intermediary his case must fall within clause (b) of sub section (1) of section 7 as it was he who had the "Khas possession" of the land now in controversy, according to the findings contained in the order dated 13th January 1962 passed by the Collector and mentioned above, which have not been shown to us to suffer from any infirmity.
And if that be so, the land must be held to have vested in him, and not in the deity, as an occupancy tenant under the provisions of that section.
In the result both the appeals succeed and are accepted, the order of the High Court impugned in each being set aside and it being directed that the possession of the land in dispute attached by the order of the Magistrate in the proceedings under section 145 of the Code of Criminal Procedure be delivered to Patel as an occupancy tenant under the State.
The parties are however left to bear their own costs throughout.
N.V.K. Appeal allowed.

dataset_name: IN-Abs

summary:
The ancestors of a former Zamindar dedicated their maufi interest in a village in favour of a deity.
Acting on behalf of the deity the ex zamindar created a lease of thikadari rights in the village in favour of the appellant for ten years.
The lease deed termed the appellant as "legal guardian of gaontia thikadari patta".
While the lease was in force the Orissa Estates Abolition Act, 1951 which sought to abolish all intermediaries in land and vest their interest in the State came into force.
The Act however protected certain intermediaries thereby carving out an exception to the scheme of the Act.
Meanwhile the Managing Trustee of the Board of Trustees appointed under the Orissa Hindu Religious Endowments Act, 1951 to look after the affairs of the deity filed a petition under section 7 of the Abolition Act claiming that the deity was in Khas possession of certain lands including the land lease to the appellant and prayed that the same be settled on the Board of Trustees as an occupancy tenant.
The question was eventually settled in favour of the Trustees and against the appellant.
In the Managing Trustee 's application under section 145 Cr.
P.C. asserting that the appellant was disturbing peaceful possession of the deity over the land, the Magistrate held that it was the appellant who was in possession of the land and directed that the land should be restored to him.
The High Court in revision set aside the order of the Magistrate.
In appeals to this Court the appellant contended that it was he and not the deity, who was the thikadar and therefore an intermediary within the meaning of the definition of that term in the Abolition Act and was in Khas possession of the land in dispute and so the land should be restored to him.
Allowing the appeals, ^ HELD: 1.
It was the appellant who had the Khas possession of the land, and therefore, the land must be deemed to have been vested in him, and not in the deity, as an occupancy tenant under the provisions of section 7 of the Abolition Act.
[328 F] 2.
Apart from the description of the appellant as gaontia thikadari patta, condition 8 contains a sure indication of the nature of the tenancy agreement.
It states "that the cultivable lands cannot be utilised for any other purpose nor can they be transferred or sold or otherwise dealt with to the hardship of the villagers or the tenants." [328 B C] 321 3.
The reference to tenants in this condition points to the land being under the cultivation of persons other than the appellant at the moment the lease was granted.
This position was incompatible with the grant of an ordinary lease to him.
The tenure granted in his favour was on the other hand one conferring on hint a right to collect the rents from the tenants of the deity and in lieu thereof pay a fixed sum to it.
He was, therefore, correctly described as gaontia or thinkdar, both of which expressions describe an intermediary as distinguished from a raiyat or an actual tiller of the soil.
[328 D E]


judgement:
Civil Appeal No. 2582 of 1969.
From the Judgment and Decree dated 12 12 1961 of the Patna High Court in Appeal from Original Decree No. 50/57.
B. P. Singh for the Appellant.
D. Gobardhan for Respondents 1 2.
U. P. Singh for Respondent No. 3.
The Judgment of the Court was delivered by CHINNAPPA REDDY, J.
The only question for consideration in this appeal is whether the plaint schedule properties are properties in respect of which there is a trust of a public or religious nature so as to attract the provisions of Bihar Hindu Religious Trusts Act (Act I of 1951).
The plaintiff appellant filed the suit out of which the appeal arises for a declaration that the properties were his personal properties and that there was no trust of a religious or public nature so as to attract the provisions of the Bihar Act I of 1951.
His case, as set out in the plaint, was that one Gurdyal Singh constructed a temple on his own land in the village of Dumri and installed the deities of Ramji, Lakshmanji and Sitaji in the temple.
He used to perform puja and raj bhog till his death.
The public had no concern with the idols.
After his death he was succeeded by his son Gulab Singh who became a bairagi assuming the name of Gulab Das.
Apart from the properties left by Gurdyal Singh, Gulab Das also acquired other properties.
On his death he was succeeded by his Chela Brahmdas who 1127 in turn was succeeded by his Chela Dwarika Das.
Each succeeding Mahant was succeeded by his Chela, the present Mahant being the plaintiff appellant.
Properties were acquired by the respective Mahants in their own individual names and were always treated as their personal properties.
Brahmdas constructed a temple in the village of Maudehin where also he installed the deities of Ramji, Lakshmanji and Sitaji and used to perform puja and raj bhog.
The temple and the properties were the private properties of the Mahant and the public did not have any interest or right in them.
The suit was contested by the Bihar State Board of Religious Trusts and others who pleaded that the temples and the properties were not the private properties of the Mahant and that they belonged to a Hindu Religious Trusts to which the provisions of the Bihar Religious Trusts Act were applicable.
The suit was dismissed by the Additional Sub Judge of Muzaffarpur and the decree of the Trial Court was confirmed by the High Court of Patna.
Shri B. P. Singh, learned counsel for the appellant plaintiff accepted the several findings arrived at by the High Court on various evidential matters and argued that even on those findings it could not be held that the properties belonged to a Trust of a religious or public nature.
He invited our attention to the decision of this Court in Bihar State Board Religious Trust, Patna vs Mahant Sri Biseshwar Das,(1) and submitted that on almost identical facts it had been held in that case that there was no trust for religious or public purposes.
In Bihar State Board Religious Trust, Patna vs Mahant Sri Biseshwar Das,(1) the facts found by the High Court as summarized by this Court were: "(1) that the temple was constructed by Gaibi Ramdasji and it was he who installed the deities therein; (2) that he was succeeded to the mahantship by his chela, and thereafter succession to the mahantship had been from guru to chela; (3) that the appointment of a successor has been all through out from guru to chela, the reigning mahant appointing or nominating his successor from amongst his chelas and the members of the public have had at no time any voice in the selection or nomination; (4) that the properties have always been recorded in the names of the mahants as proprietors and not in the name of the deities in the D registers, Khewats and Khatians; 1128 (5) that the mahants have been in possession and management of the asthal and the properties all throughout; (6) that the mahants acquired properties from time to time in their own names as proprietors and never in the names of the deities or the asthal, without any objection at any time from any one and dealt with some of them through deeds of sales, mortgages, leases etc." Before this Court reliance was placed on the following circumstances to prove that the properties were impressed with a trust for religious or public purposes: "(1) the fact that the mahants were vaishnav bairagis who were life long celibates; (2) that sadhus and others were given food and shelter when they visited the temple; (3) that festivals and other important Hindu dates used to be celebrated; (4) that the members of the public came to the temple for darshan without any hindrance and as of right; (5) that in the deeds and wills, whereby reigning mahants appointed or nominated their successors, the properties were described as appertaining to the asthal, and that the temple being the dominant part of the asthal and maintained for the worship and puja of the presiding deities installed therein, the properties belonged to the temple, and therefore, they were properties of a trust for religious and charitable character.
(6) The idols were installed partly on a pedestal and the temple was constructed on grounds separate from the residential quarters of the Mahant".
It was held by this Court that everyone of the circumstances was equally consistent with the character of the trust being public or private and that the onus which was on the Bihar State Religious Trust Board to establish the public nature of the trust had not been discharged.
In view of the submissions of the learned counsel for the appellant, it is necessary to refer to the findings of the High Court in the present case.
The High Court found that there was no evidence to show who the founder of the Mutt was and who built the temples.
1129 It was also found that there was no evidence to show that the temple in the village of Dumri was constructed on the land belonging to Gurdyal Singh or that the temple in the village of Maudah was constructed on land belonging to Brahmdas.
It was found that several properties were acquired by various Mahants in their names instead of in the names of the idols but the acquisition of properties was for the purposes of the Asthal or Mutt.
It was also found that from time to time gifts of land had been made by the villagers of Dumri.
It was found that the Mahants had executed Kebalas for effecting repairs of the temples and had similarly executed deeds of mortgage.
It was found that the people of the villages of Dumri and Maudah used to visit the temple without any let or hinderance and that the Mutt was so located as to suit the convenience of the villagers of both Dumri and Harpur.
It was situated on the boundary of the two villages and was on a platform at a certain height, open on all sides with plenty of space around it.
The temple in the Mutt had three doors with space for visitors.
It was noticed by the High Court that the lands were held rent free in consideration of religious services.
It is true as submitted by the learned counsel, many of the circumstances are neutral.
The fact that members of the public were permitted to go to the temple without any hindrance might not be a circumstance which by itself would conclusively establish that the temple was a public temple in the absence of an element of right in the user of the temple by the public.
Conversely the free use of the properties of the temple by the Mahant at a time when he was the sole manager of the temple and its properties would not necessarily lead to the inference that the temple was not a public temple.
Patently there can be no simple or conclusive factual tests to determine the character of a trust.
The totality of the circumstances and their effect must be considered.
Here not only do we find that members of the public were allowed free access to the temple, they were evincing much greater interest in the institution as evidenced by the circumstances that several villagers had made gifts of land to it, a circumstance which would ordinarily be consistent with the nature of the institution being public and not private.
Again, as pointed out by Venkatarama Ayyar, J., Deoki Nandan vs Murlidhar,(1) the situation of the temple would be an important circumstance in determining whether it was private or public.
The High Court has pointed out that the temple was constructed outside the village on open land between the villages of Dumri and Harpur so as to be convenient to the villagers of both the villages.
It was constructed on a high platform and was open on all sides with 1130 plenty or space around it to accommodate large number of people.
Obviously the temple was located and constructed so as to attract and accommodate large number of villagers from the two villages.
The donation of land by members of the public to the institution and the location of the temple at a place freely accessable and convenient to the public were circumstances which were absent in Bihar State Board Religious Trust, Patna vs Mahant Sri Biseshwar Das (supra).
We are satisfied that, in the circumstances the High Court was right in holding that there was a trust of a public nature.
The appeal is, therefore, dismissed with costs.
N.V.K. Appeal dismissed.

summary:
The appellant (plaintiff) the present Mahant, filed a suit for a declaration that the plaint schedule properties were his personal properties and that there was no trust of a religious or public nature so as to attract the provisions of the Bihar Hindu Religious Trust Act 1951.
It was contended in the suit that one G constructed a temple on his own land in the village, installed deities, performed puja and raj bhog till his death, that the public had no concern with the idols and that after his death he was succeeded by his son who became a bairagi.
Apart from the properties left by him, his son also acquired other properties.
On the son 's death he was succeeded by his Chela who became a Mahant.
Each succeeding Mahant was succeeded by his Chela.
Properties were acquired by the respective Mahants in their own name and treated as their personal properties.
One of the Mahants constructed a temple in a nearby village where he installed deities and performed puja and raj bhog.
It was claimed that the temple and the properties were the private properties of the Mahant and the public did not have any interest or right in them.
The suit was contested by respondent No. 1, contending that the temples and the properties were not the private properties of the Mahant and that they belonged to a Hindu Religious Trust to which the provisions of the Bihar Hindu Religious Trusts Act, 1951 were applicable.
The Trial Court dismissed the suit and its decree was confirmed by the High Court.
In the appeal to this Court, the question was whether the plaint schedule properties were properties in respect of which there was a trust of a public or religious nature so as to attract the provisions of the Bihar Hindu Religious Trusts Act, 1951.
^ HELD: 1.
The High Court was right in holding that there was a trust of a public nature.
[1130B] 2.
The fact that members of the public were permitted to go to the temple without any hinderance might not be a circumstance which by itself would conclusively establish that the temple was a public temple in the absence of an element of right in the user of the temple by the public.
Conversely the free use of the properties of the temple by the Mahant at a time when he was the sole manager of the temple and its properties would not necessarily lead to the inference that the temple was not a public temple.
[1129E] 3.
There can be no simple or conclusive factual test to determine the character of a trust.
The totality of the circumstances and their effect must be considered.
[1129F] In the instant case not only were the members of the public allowed free access to the temple, but they were evincing much greater interest in the insti 1126 tution as several villagers had made gifts of land to it, a circumstance which would ordinarily be consistent with the nature of the institution being public and not private.
[1129F] 4.
The situation of the temple would be an important circumstance in determining whether it was private or public.
[1129G] Deoki Nandan vs Murlidhar ; referred to.
In the instant case the High Court had pointed out that the temple was constructed outside the village on open land between two villages so as to be convenient to the villagers of both the villages.
It was constructed on a high platform and was open on all sides with plenty of space around it, so as to attract and accommodate large number of villagers from two villages.
This indicated that the trust was of a public nature.
[1129H 1130A] 5.
The donation of land by members of the public to the institution and location of the temple at a place freely accessible and convenient to the public were circumstances which indicated that the trust was of a public nature.
[1130B] Bihar State Board Religious Trust, Patna vs Mahant Sri Biseshwar Das,[1971] 3 S.C.R. 680, distinguished.


judgement:
Civil Appeal No. 2614 of 1969.
From the Judgment and Order dated 20 12 1967 of the Allahabad High Court in Second Appeal No. 3105 of 1963.
G. N. Dixit and O. P. Rana for the Appellant.
Ex parte for the Respondent.
The Judgment of the Court was delivered by CHINNAPPA REDDY, J.
A second appeal under section 100 of the Code of Civil Procedure 1908 was allowed by the Allahabad High Court and the matter was remanded to the Lower Appellate Court for fresh disposal in accordance with law point.
The order of remand was made under the provisions of Order XLI Rule 23 of the Civil Procedure Code 1908, as amended by the Allahabad High Court.
The 1132 successful appellant before the High Court filed an application under section 13 of the Court Fees Act, 1870 claiming a refund of the Court Fees Act, 1870 claiming a refund of the Court fee paid in the Second Appeal.
The application came before G. C. Mathur, J., who entertained a doubt whether section 13 of the Court Fees Act applied to a case of remand under the provisions of Order XLI Rule 23 Civil Procedure Code as amended by the High Court and referred the question for the consideration of a Full Bench.
Thereafter the application was heard by the Full Bench consisting of Jagdish Sahai, Pathak and Kirty, JJ.
Pathak and Kirty JJ., took the view that refund of Court Fee could be ordered under section 13 of the Court Fees Act, even where the remand was made under the amended provisions of Order XLI Rule 23.
Jagdish Sahai, J. dissented.
In accordance with the opinion of the majority, the court fees paid by the appellant before the High Court was directed to be refunded.
The State of U.P. obtained a certificate under Article 133(1)(c) of the Constitution and has preferred this appeal.
Section 13 of the Court Fees Act 1870, in so far as it is material is as follows: "If an appeal or a plaint, which has been rejected by the lower Court on any of the grounds mentioned in the Code of Civil Procedure as ordered to be received, or if a suit is remanded in appeal on any of the grounds mentioned in section 351 of the same code for a second decision of a lower court, the lower court shall grant to the appellant a certificate, authorising him to receive back from the Collector the full amount of fee paid on the memorandum of appeal".
Section 13, thus speaks of a suit remanded in appeal on any of the grounds mentioned in section 351 of the same Code i.e. the Code of Civil Procedure which was then in force.
Section 351 of the Code of Civil Procedure 1859 provided for the remand of a case by the appellate court to the lower court for a decision on the merits on the case.
where "the lower court shall have disposed of the case upon any preliminary point so as to exclude any evidence of fact whish shall appear to the appellate court essential to the rights of the parties".
If the decision on the preliminary point was reversed by the appellate court.
The Code of 1859 was repealed and replaced by the Code of 1877.
Section 562 of the 1877 Code was substantially in the same terms as section 351 of the 1859 Code.
The Code of 1882 was repealed and replaced by the Code of Civil Procedure 1908.
Order XLI Rule 23 of the 1908 Code also provided for the remand of a case 1133 to the lower court by the appellate court where the suit had been disposed of upon a preliminary point and the decision of such preliminary point was reversed in appeal by the appellate court.
In exercise of the powers vested in it under section 122 of the Code of Civil Procedure 1908, the Allahabad High Court amended the provisions of Order XLI Rule 23 so as to provide for the remand of a case by the appellate court to the trial court, not only when the suit had been decided upon a preliminary point and the decision was reversed in appeal, but also whenever the appellate court considered it necessary in the interest of justice.
The question for consideration in this appeal is whether the power to grant refund of court fees under section 13 of the Court Fees Act 1870 was attracted to a case where the appellate court remanded the case to the lower court in the interest of justice as provided by the provisions of Order XLI Rule 23 as amended by the High Court of Allahabad.
In order to answer the question a reference is necessary to section 158 of the Code of Civil Procedure 1908.
It was as follows: "158.
In every enactment or notification passed or issued before the commencement of this Code in which reference is made to or to any Chapter or section of Act VIII of 1859 or any Code of Civil Procedure or any Act amending the same or any other enactment hereby repealed, such reference shall, so far as may be practicable, be taken to be made to this Code or to its corresponding Part, Order, Section or rule".
It follows from Section 158 that reference in Section 13 of the Court Fees Act 1879 to Section 351 of the Code of Civil Procedure 1859 has to be read as reference to Order XLI Rule 23 of the Code of Civil Procedure 1908.
The submission of the learned counsel was that the reference to any provision of the Code of Civil Procedure 1908 pursuant to section 158 of the Code must be to provision occurring in the body of the main code consisting of the provisions from section 1 to section 158 and not to the provisions of the rules in the first schedule.
He further submitted that even if reference to the rules in the first schedule was permissible it should only be to the rules as enacted by the legislature itself and not as amended by the High Court.
The first part of the submission of the learned counsel has to be rejected straightaway having regard to the express reference to 'Order ' and 'Rule ' in section 158 of the Code of Civil Procedure 1908.
The second part of the submission requires a slightly closer examination.
Section 2(1) of the Code of Civil Procedure 1908 defined "Code" as including 1134 "Rules".
Section 2(18) defined "Rules" as meaning "Rules and forms contained in the first schedule or made under section 122 or section 125".
Section 121 of the 1908 Code declared that the rules in the first schedule shall have effect "as if enacted in the body of the code until annulled or altered in accordance with the provisions of part X of the Code" (section 121 to 131).
Section 122 enabled the High Court to make rules, from time to time "regulating their own procedure or the procedure of the Civil code subject to their superintendence, and made by such rules, annual, alter or add to all or any of the rules in the first schedule".
Section 126 made the rules made by the High Court subject to the previous approval of the Government of the State.
Section 127 provided that the rules so made and approved shall have the same force and effect as if they had been contained in the first schedule.
These provisions make it abundantly clear that the rules made by a High Court altering the rules contained in the first schedule as originally enacted by the legislature shall have the same force and effect as if they had been contained in the first schedule and therefore, necessarily became part of the Code for all purposes.
That is the clear effect of the definition of the expressions "Code" and "Rules" and sections 121, 122 and 127.
It does not appear to be necessary to embark upon a detailed examination of each one of these provisions, since the position appears to us to be very clear.
We, therefore, agree with the view expressed by Pathak and Kirty JJ., in Chandra Bhushan Misra vs Smt.
Javatri Devi(1), regarding the effect of section 158 of the Code of Civil Procedure and sections 2(1) to 2(18), 121, 122 and 127.
Jagdish Sahai J., was inclined to the view that the amendments made by the High Court were only fictionally embodied in the Code and that the reference to section 351 of the Code of 1859 in section 13 of the Court Fees Act was to be construed as a reference only to the provisions of Order XLI Rule 23, as originally passed by the Legislature and not as amended by the High Court.
In our opinion the view of Jagdish Sahai, J. does not give full effect to section 127 of the Civil Procedure Code 1908 which provided that the rules made by the High Court shall have the same force and effect as if they had been contained in the first schedule.
We are of the view that the question was rightly answered by the Full Bench of the Allahabad High Court and the appeal is, therefore, dismissed.
P.B.R. Appeal dismissed.

summary:
A second appeal under section 100 Code of Civil Procedure 1908 was allowed by the Allahabad High Court and the matter was remanded by the High Court under Order XLI, Rule 23 CPC as amended by the High Court to the Lower Appellant Court for fresh disposal in accordance with law.
A majority of the Division Bench allowed the respondents claim for refund of the court fees on the view that refund could be ordered under section 13 of the Court Fees Act even where the remand was made under the amended provisions of Order XLI, Rule 23.
In appeal it was contended that even if reference to the rules in the first schedule was permissible it should only be to the rules as enacted by the legislature and not as amended by the High Court.
^ HELD: A conspectus of the relevant provisions of the Code of Civil Procedure 1908 makes it clear that the rules made by the High Court altering the rules contained in the first schedule as originally enacted by the legislature shall have the same force and effect as if they had been contained in the first schedule and therefore necessarily become part of the code for all purposes.
That is the clear effect of the definition of the expression 'code ' and 'rules ' and sections 121, 122 and 127 of the Code of Civil Procedure, 1908.
[1134 C E] Chandra Bhushan Misra vs Smt.
Javatri Devi A.I.R. (56) 1969 Allahabad 142 approved.


judgement:
Civil Appeal No. 2531 of 1969.
From the Judgment and Order dated 20 1 1969 of the Kerala High Court in A.S. No. 39/65.
P. Govindan Nair and K.J. John for the Appellant.
M.R.K. Pillai for the Respondent.
The Judgment of the Court was delivered by KOSHAL, J.
For a proper appreciation of the dispute giving rise to this appeal by Special Leave against the judgment dated 20th of 1159 January, 1969, of a Division Bench of the High Court of Kerala, a reference to various provisions of the Travancore Chitties Act (herein after called the 'Chitties Act ') being Act XXVI of 1120 (which year corresponds to years 1944 and 1945 of the Christian era) is necessary.
Clause (2) of section 3 of the Chitties Act defines a 'chitty ' thus: "A 'chitty ' means a transaction by which one or more persons hereinafter called the foreman or foremen enter into an agreement with a number of persons, that every one of the contracting parties shall subscribe a certain amount of money or quantity of grain by periodical instalments for a certain definite period and that each in his turn, as determined by lot or by auction or in such other manner as may be provided for in the variola, shall be entitled to the prize amount." "Chitty amount" is defined in clause (3) of section 3 to mean the sum total of the contributions payable by all the subscribers for any instalment without any deduction for discount.
In clause (4) the term 'discount ' is stated to mean the amount of money or quantity of grain which a prize winner has, under the terms of the variola, to forego for payment of veethapalisa, foreman 's commission or other expenses.
A 'foreman ' as per clause (6) is the person who, under the variola, is responsible for the conduct of the chitty. 'Variola ' is defined in clause (14) to be a document containing the articles of agreement between the foreman and the subscribers in relation to the chitty while, under clause (15) 'veethapalisa ' is the share of a subscriber in the discount available under the variola for rateable distribution among the subscribers at each instalment of the chitty. 'Prize amount ' says clause (9), means the chitty amount reduced by the discount.
Section 9 enumerates 13 particulars which a variola must contain and they are: (1) the full name and residence of every subscriber; (2) the number of tickets or the fraction thereof held by each subscriber; (3) the number of instalments and the amount payable for each ticket at every instalment; (4) the date on which the chitty is to begin and the date on which it is to terminate; (5) the mode of ascertaining the prize winner at the successive instalments; (6) the amount of discount which a prize winner at any instalment has to forego; 1160 (7) the mode and proportion in which the discount is distributable by way of veethapalisa, foreman 's commission and other allowance, if any; (8) the time and place at which the chitty is to be conducted; (9) the instalment at which the foreman is to get the prize; (10) the approved banks in which chitty moneys shall be invested by the foreman under the provisions of the Act; (11) the consequence which a non prized or prized subscriber, or the foreman, will be liable to in case of any violation of the variola; (12) the nature and particulars of the security offered by the foreman under section 17; and (13) any other particulars that may from time to time be prescribed by the Government.
Section 14 deals with the time and place where the drawing of prizes in a chitty shall be conducted.
Section 17 to 24 relate to the rights and liabilities of a foreman while the next three sections following provide for non prized subscribers.
Sections 29 to 32 embrace provisions regarding prized subscribers.
Sections 38, 39 and 41 relate to termination of chitties and may be reproduced here with advantage: "38.
(1) When a foreman dies or becomes of unsound mind his legal representative or his guardian as the case may be, shall, in the absence of any provision in the variola to the contrary, take the place of the foreman and have the right to continue the chitty or to make suitable arrangements for the further conduct of the chitty.
(2) When a foreman is adjudicated an insolvent under the law relating to insolvent debtors for the time being in force or withdraws from the chitty under section 24 or fails to conduct the chitty at any instalment or any other date before the next succeeding instalment as may have been agreed upon by a special resolution in that behalf, any one or more of the nonprized subscribers authorized by a special resolution may, in the absence of any provision in the variolas for the future conduct of the chitty, take the place of the foreman and have the right to continue the chitty or to make suitable arrangements for the further conduct of the chitty.
" 1161 "39.
A chitty shall be deemed to have terminated only (1) When the period fixed in the variola or the period as altered by a subsequent special resolution for the duration of the chitty has expired, or (2) when the legal representative of a deceased foreman or the guardian of a foreman of unsound mind or the subscriber or subscribers selected therefor fail to conduct the chitty or make suitable arrangements for the further conduct of the chitty as provided for in section 38; Provided however that if there are more foremen than one and one or more such foremen are living and are not disqualified to act under section 38, the chitty shall not be deemed to have terminated under this clause if there is provision in the variola enabling the remaining foreman or foremen to conduct the chitty or if the non prized subscribers agree by a special resolution to the conduct of the chitty by the remaining foreman or foremen." "41.
Except in the case of clause (1) of section 39, every non prized subscriber shall, unless otherwise provided for in the variola and subject to the provisions of section 27, be entitled to get back his contributions at the termination of the chitty without any deduction for veethapalisa, if any, received by him.
The facts are undisputed and may be briefly stated.
The plaintiff, viz., the Goodland Plantations (P) Ltd., (hereinafter referred to as the 'Company ') became a subscriber to a monthly chitty run by the Kottayam Orient Bank Limited ( 'the Orient Bank ' for short) as foreman.
The Company was to pay, like all other subscribers, a sum of Rs. 20,000/ in 50 monthly instalments of Rs. 400/ each.
The conduct of the chitty was governed by variola exhibit P 1, apart from the various provisions of the Chitties Act.
The chitty started on the 10th of September, 1960, when the Company paid the first instalment due from it.
Three other instalments were paid by the Company on 10 10 1960, 10 11 1960 and 10 12 1960 to the foreman.
On the date last mentioned, an auction was held for the prize amount for which the Company was declared to be the successful bidder, it having elected to accept a sum of Rs. 11,075/ in lieu of the full amount of Rs. 20,000/ .
The prize amount was to be paid to the Company a month later, i.e., on the 10th of January, 1961, (when the fifth instalment was to become payable) subject to the Company furnishing security for the continued 1162 performance of its part of the variola in future.
However, before that stage was reached, the Central Government, on the 17th of December, 1960, imposed a moratorium on the Orient Bank under section 45 (2) of the Banking Regulation Act, 1949, (hereinafter referred to as 'the Banking Act ') with the consequence that the Orient Bank had to suspend all business/activity.
The moratorium was enforced originally for the period ending with the 18th of March, 1961, which was later on extended upto the 16th of June, 1961, (exhibits D 1, D 2 and D 4).
The suspension of business resulted in the conduct of the chitty being discontinued so that under sub section (2) of section 39 of the Chitties Act read with section 41 thereof as also clause (14) of the variola, the chitty stood terminated and the Orient Bank in its capacity as the foreman of the chitty incurred the obligation to pay back all the contributions made by non prized subscribers.
On the 16th of May, 1961, the Central Government sanctioned under sub section (7) of section 45 of the Banking Act a Scheme prepared by the Reserve Bank of India under sub sections (4) to (6) of that section for the amalgamation of the Orient Bank with the State Bank of Travancore (hereinafter called the 'Travancore Bank ').
The Scheme provided inter alia that all the assets and liabilities of the Orient Bank would stand transferred to the Travancore Bank with effect from the 17th of June, 1961.
In relation to chitties the Scheme laid down: "If the transferor bank was acting immediately before the prescribed date as a foreman in respect of any kuri or chitty as defined in the Travancore Chitties Act (XXVI of 1120) or the Cochin Kuries Regulation (VII of 1107) the rights, duties and obligations in relation to the kuri or chitty shall be regulated in accordance with the following provisions, namely, (i) the transferee bank shall become the foreman of the kuri or chitty and shall continue to exercise all powers and to do all such acts and things as would have been exercised or done by the transferor bank, in so far as they are not in consistent with this scheme; (ii) the funds, if any, of the kuri or chitty lent to or deposited with the transferor bank, or otherwise due from that bank to the kuri or chitty shall be transferred to the transferee bank, and the liabilities corresponding to such funds shall also be payable by the transferee bank in accordance with the other provisions of this scheme; 1163 (iii) if on the prescribed date the transferor bank in its capacity as the foreman of any kuri or chitty has deposited any security for the due performance of its duties and obligations in relation to the said kuri or chitty, the said security shall continue to be available for the purposes for which it was intended, but shall if and to the extent that it is subsequently released be transferred to and vest in the transferee bank provided that the said security or as the case may be, the surplus, if any, after providing for the discharge of the duties or obligations in respect of the kuri or chitty shall be valued and utilised for the purposes of this scheme.
" Later on it was realised that the Travancore Bank would not be able to continue the chitties for which the Orient Bank had acted as foreman earlier because those chitties had terminated owing to the failure of the Orient Bank to continue to conduct them by reason of the moratorium and in order to cross this hurdle the Central Government passed another order dated the 4th of December, 1961, which was described as the Kottayam Orient Bank Limited (Amalgamation with the State Bank of Travancore) (Removal of Difficulties) Order, 1961.
That order (hereinafter called the 'impugned order ') was passed under sub section (10) of section 45 of the Banking Act and its relevant portion is extracted below: "2.
Notwithstanding anything contained in the Travancore Chitties Act or the Cochin Kuries Regulation, the suspension of any kuri or chitty for the period from the 18th December, 1960, to the 31st December, 1961, or for any part of that period and any consequent prolongation of the kuri or chitty shall have effect as though the articles in the variola(s) were altered or added to for that purpose by special resolution(s) of the subscribers of the kuri or chitties and as though the relevant provisions, if any, of the Travancore Chitties Act or the Cochin Kuries Regulation were complied with, and notwithstanding anything contained in the Travancore Chitties Act or the Cochin Kuries regulation, the failure of the foreman to conduct the kuri or chitty during the said period shall not be deemed to have terminated the kuri or chitty." "3.
Notwithstanding anything contained in the variola (s) the period fixed for the duration of the kuri or chitty shall be deemed to have been extended by the period referred to in 2 above." 1164 "4.
Notwithstanding anything contained in the Travan core Chitties Act or the Cochin Kuries Regulation, the State Bank shall continue the kuri or chitty as if the provisions, if any of the said Act or the said Regulation relating to continuance of the kuri or chitty have been complied with." "5.
All the words and expressions used herein but not defined shall have the meanings respectively assigned to them in the Travancore Chitties Act, or as the case may be, the Cochin Kuries Regulation.
" By another order dated the 15th of January, 1962, (exhibit P 4) the impugned order was amended so that the words "the 31st March, 1962" were substituted for the words "31st of December, 1961" occurring in paragraph 2 thereof.
The effect of the impugned order as amended by order exhibit P 4 was to obliterate the termination of the chitties as resulting from the suspension thereof by reason of the moratorium during the period from the 18th of December, 1960, to the 31st of March, 1962, and to enable the Travancore Bank to continue those chitties as if there had been no suspension thereof at any point of time so that they could be continued as if the relevant provisions of the Chitties Act and the relevant variolas had throughout been complied with.
The litigation started with a suit instituted by the Company on the 6th of December, 1961, claiming refund of the four instalments paid by it along with interest.
No reference was made in the plaint to the impugned order presumably because the Company had no knowledge of the existence thereof as it had been passed only a couple of days before the suit was filed.
The claim of the Company was based on the averment that the Orient Bank had failed to conduct the chitty to which the Company had subscribed, that the chitty had come to a termination by reason of the default made by the Orient Bank, that the Orient Bank had in consequence become liable for payment back to the Company of the instalments deposited by it and that the Travancore Bank (the sole defendant) had inherited the liability of the Orient Bank.
The suit was resisted on the strength of the impugned order (as amended by order exhibit P 4) but the vires of that order were challenged by the Company on whose behalf it was urged that the impugned order did not fall within the ambit of sub section (10) of section 45 of the Banking Act and that in any case that sub section itself was constitutionally invalid inasmuch as its enactment amounted to an abdication of the legislative power which, under Article 245 of 1165 the Constitution of India, vested in Parliament and in Parliament alone.
The suit was originally filed in the Court of the Munsif at Kottayam but was transferred by the High Court to its own file in 1963 because the constitutional validity of sub section (10) of section 45 of the Banking Act was questioned.
The suit was dismissed by Raman Nayar, J., who held that the impugned order fell squarely within the scope of sub section (10) of section 45 of the Banking Act, which sub section also did not suffer, according to the learned judge, from the infirmity of excessive delegation.
Sub section (10) states: "If any difficulty arises in giving effect to the provisions of the scheme, the Central Government may by order do anything not inconsistent with such provisions which appears to it necessary or expedient for the purpose of removing the difficulty." Raman Nayar, J., noted that the three requirements of the sub section were: "(1) that a difficulty should arise in giving effect to the provisions of the scheme; (2) that the order to be made must be such as appears to the Central Government to be necessary or expedient for the purpose of removing the difficulty; and (3) that the order must not be inconsistent with any of the provisions of the scheme": and found that all three of them were amply satisfied in the present case.
In his view the object of the Scheme promulgated by the Central Government on the 16th of May, 1961, under sub section (7) of section 35 of the Banking Act was that the Travancore Bank should take over the business of the chitties earlier run by the Orient Bank and conduct the same to a "successful conclusion".
However, that object, according to the learned Judge, could not be achieved as the Scheme did not provide for an obliteration of the termination of the said chitties which had already taken place under sub section (2) of section 38 of the Chitties Act read with sub section (2) of section 39 thereof and the provisions contained in the variolas.
The learned Judge was clearly of the opinion therefore that a difficulty had arisen in giving effect to the provisions of the Scheme which was sought to be remedied by the impugned order.
The argument that the Scheme 1166 did not envisage the continuation of the chitties by the Travancore Bank, that all that the Scheme provided for was that the rights and obligations of the orient Bank in relation to the chitties stood transferred to the Travancore Bank and that in consequence, the latter became liable for the return of the amounts deposited by the subscribers with the Orient Bank, was turned down by the learned Judge with the following observations: "It is no use saying that the defendant Bank could have had no difficulty in accepting that the chitty had terminated and paying off the unprized subscribers.
For, that would not be to work the scheme which clearly contemplates that the defendant bank should run the chitties to a successful conclusion.
The difficulty that stood in the way of this being done was certainly a difficulty in giving effect to the provisions of the Scheme".
For repelling the contention put forward on behalf of the Company about the constitutional invalidity of sub section (10) of section 45 of the Banking Act, the learned Judge relied on In re article 143 Constitution of India, etc.(1) and Rajnarain Singh vs Chairman, P.A. Committee (2).
Against the dismissal of its suit, the Company instituted the appeal which was accepted by the Division Bench through the judgment challenged before us.
Isaac, J., speaking for himself and Pillai, J., disagreed with the learned trial Judge as to the object of the Scheme of amalgamation and observed that in so far as the chitties were concerned, there was nothing in the Scheme to show that such object was to run them to a successful conclusion.
He was further of the opinion that there was no difficulty at all in the way of the Scheme, as originally promulgated, being given effect to In this connection he remarked: "There is no difficulty in paying the amount.
The difficulty is only for not paying it; and what was achieved by exhibits P 3 and P 4 was the creation of that difficulty.
What exhibit P 3 provides is that the period during which the chitty was not conducted would be treated as a period of suspension of the chitty by a special resolution of the subscribers.
The result of that provision was that the right of the plaintiff to get from the defendant the amount subscribed to the chitty was taken away and substituted with a liability to 1167 draw the prize amount on furnishing security for payment of future instalments.
This is a provision which is clearly inconsistent with the provisions of the Scheme.
Exhibits P 3 and P 4 are, therefore in my view beyond the scope of the power conferred on the Central Government under sub section (10) of section 45 of the Banking Companies Act." In regard to the question of constitutional validity of sub section (10), however, the Division Bench concurred with the learned trial Judge and held that sub section (10) did not suffer from excessive delegation of legislative power.
Allowing the appeal, the Division Bench decreed the suit with costs of the proceedings in both the courts.
The question of the constitutional validity of sub section (10) of section 45 of the Banking Act has not been raised before us and all that we have to determine therefore is whether the impugned order falls within or outside the scope of that sub section.
Shri Govindan Nair, learned counsel for the Company, has vehemently contended that one of the objects of the Scheme was to continue the chitties (which had earlier been conducted by the Orient Bank but had come to a termination by reason of the moratorium) to a "successful conclusion" as held by the learned trial Judge and that the finding to the contrary recorded in the impugned judgment is erroneous and after hearing him and learned counsel for the Travancore Bank at length we have no hesitation in agreeing with Shri Nair 's contention.
It is to be noted that the provision regarding chitties appears in the latter part of paragraph 2 of the Scheme, the earlier part of which may be quoted here with advantage: "(2) As from the date which the Central Government may specify for this purpose under sub section (7) of section 45 of the said Act (hereinafter referred to as the prescribed date) all rights, powers, claims, demands, interests authorities, privileges, benefits, assets and properties of the transferor bank, movable and immovable, including premises subject to all incidents of tenure and to the rents and other sums of money and covenants reserved by or contained in the leases or agreements under which they are held, all office furniture, loose equipment, plant apparatus and appliances, books, papers, stocks of stationery, other stocks and stores, all investment in stocks shares and securities all bills receivable in hand and in transit, all cash 1168 in hand and on current or deposit account (including money at call or short notice) with banks, bullion, all books debts, mortgage debts and other debts with the benefit of the securities, or any guarantee therefor, all other, if any, property rights and assets of every description including all rights of action and benefit of all guarantees in connection with the business of the transferor bank shall, subject to the other provisions of this Scheme, stand transferred to, and become the properties and assets of, the transferee bank; and as from the prescribed date all the liabilities, duties and obligations of the transferor bank shall be and shall become the liabilities, duties and obligations of the transferee bank to the extent and in the manner provided hereinafter.
Without prejudice to the generality of the foregoing provisions all contracts, deeds, bonds, agreements, power of attorney, grants of legal representation and other instruments of whatever nature subsisting or having effect immediately before the prescribed date shall be effective to the extent and in the manner hereinafter provided against or in favour of the transferee bank and may be acted upon as if instead of the transferor bank the transferee bank had been a party thereto or as if they had been issued in favour of the transferee bank.
" These pervasive provisions embraced within their ambit a complete transfer of all rights and liabilities of whatever nature, of the Orient Bank to the Travancore Bank and no special provision was therefore needed to be included in the Scheme in regard to chitties if they were not to be continued to a "successful conclusion".
As it is, the portion of paragraph 2 extracted by us earlier did provide for chitties on a special footing which could not have been the case if the rights and liabilities of the Orient Bank in regard to chitties were sought to be transferred to the Travancore Bank on the basis of the termination of the chitties which had already become operative because of the moratorium and as a consequence of suspension of the chitty business by the Orient Bank.
Nor was it necessary to provide in clause (1) occurring in paragraph 2 of the Scheme that "the transferee bank shall become the foreman. and shall continue to exercise all powers and to do all such acts and things as would have been exercise or done by the transferor bank. " if the chitties were to be dealt with as having come to a termination.
The special provision for the chitty business in the Scheme cannot be regarded as redundant and it was obviously made with a purpose 1169 which, in the circumstances of the case, could be nothing more or less than to provide for the continuation of the chitties in supersession of their termination.
No other reasonable explanation of that special provision appears to us possible.
And if that be so, the entire reasoning adopted in the impugned judgment for arriving at the conclusion that the impugned order was beyond the scope of sub section (10) of section 45 of the Banking Act would become unacceptable; for, in that case, the difficulty which the impugned order sought to overcome would become very real so that the Central Government would be fully competent under the provisions of that sub section to pass an order removing that difficulty and the order actually passed could not be considered to be inconsistent with the provisions of the Scheme to any extent or in any manner.
In the result we hold that the impugned order did not fall outside the scope of the power conferred on the Central Government under sub section (10) of section 45 of the Banking Act and reverse the finding to the contrary recorded in the impugned judgment.
Allowing the appeal, therefore, we set aside the impugned judgment and dismiss the suit but, in the circumstances of the case, leave the parties to bear their own costs throughout.
N.K.A. Appeal allowed.

summary:
The respondent Company, a subscriber, had to pay money in monthly instalments to a Chitty run by the Orient Bank.
The last instalment was paid on December 10, 1960.
The respondent was the successful bidder.
The prize amount was to be paid to the respondent on January 10, 1961.
But before that date the Central Government imposed a Moratorium, originally for the period ending with the March 18, 1961 which later on was extended upto June 16, 1961 on the Orient Bank with the result that the Orient Bank had to suspend all its business activity.
This resulted in the conduct of the Chitty being discontinued, so that the Chitty stood terminated and the Orient Bank in its capacity as the Foreman of the Chitty incurred the obligation to pay back all the contributions made by non prized subscribers.
The Central Government sanctioned a scheme under the Banking Regulation Act for the amalgamation of the Orient Bank with the appellant (Travancore Bank).
Realising that the Travancore Bank would not be able to continue the Chitties for which the Orient Bank had acted as Foreman because those Chitties had terminated owing to the failure of the Orient Bank to continue to conduct them by reason of the Moratorium, the Central Government passed an order on December 4, 1961 under section 45(10) of the Banking Act.
This order was further amended substituting the words "the 31st March 1962" for the words "31st December 1961", the effect of which was to obliterate the termination of the Chitties as resulting from the suspension thereof by reason of the moratorium during the period from December 18, 1960 to 31st March, 1962, and to enable the appellant Bank to continue those Chitties as if there had been no suspension at any point of time, so that they could be continued as if the relevant provisions of the Chitties Act and the relevant variolas had throughout been complied with.
The respondent filed a suit claiming refund of the four instalments paid by it along with interest.
There was no reference to the impugned order presumably because the respondent had no knowledge thereof.
The suit was resisted on the strength of the impugned order dated 15 1 1962, but the vires of that order was challenged by the respondent and it was urged that the impugned order did not fall within the ambit of sub section (10) of section 45 of the Banking Act and that in any case that sub section itself was constitutionally invalid.
The suit was transferred by the High Court to its own file, from the Court of Munsif as the constitutional validity of section 45(10) of the Banking Act was questioned.
The suit was dismissed.
The respondent instituted an appeal which was accepted by the Division Bench.
Disagreeing with the trial judge as to the object of the scheme of 1158 amalgamation the Division Bench held that sub section (10) did not suffer from excessive delegation of legislative power.
It was urged on behalf of the respondent in this Court that one of the objects of the scheme was to continue the Chitties to a successful conclusion as held by the trial Judge and that the finding to the contrary recorded in the impugned judgment was erroneous.
Allowing the appeal, ^ HELD: The pervasive provisions embraced in the later part of paragraph 2 of the scheme embraced within their ambit a complete transfer of all rights and liabilities, of whatsoever nature, of the Orient Bank to the appellant Bank and no special provision was therefore needed to be included in the scheme in regard to Chitties, if they were not to be continued to a successful conclusion.
As it is, the portion of paragraph 2 provides for Chitties on a special footing which could not have been the case if the right and liabilities of the Orient Bank in regard to Chitties were sought to be transferred to the appellant Bank on the basis of the termination of the Chitties which had already become operative because of the Moratorium and as a consequence of suspension of the Chitty business by the Orient Bank.
Nor was it necessary to provide in clause (1) of paragraph 2 of the scheme that "the transferee Bank shall become the forman. and shall continue to exercise all powers and to do all such acts and things as would have been exercised or done by the transferor Bank. " if the Chitties were to be dealt with as having come to termination.
The special provision for the Chitty business cannot be regarded as redundant and it was obviously made with a purpose which, in the circumstances of the case, could be nothing more or less than to provide for the continuation of the Chitties in supersession of their termination.
No other reasonable explanation of that special provision appears possible.
And if that be so, the entire reasoning adopted in the judgment of the Division Bench for arriving at the conclusion that the impugned order was beyond the scope of sub section (10) of section 45 of the Banking Act would become unacceptable; for, in that case, the difficulty which the impugned order sought to overcome would become very real so that the Central Government would be fully competent under the provisions of that sub section to pass an order removing that difficulty and the order actually passed could not be considered to be inconsistent with the provisions of the scheme to any extent or in any manner.
The impugned order therefore did not fall outside the scope of the power conferred on the Central Government under sub section (10) of section 45 of the Banking Act.
[1168 E H, 1169 A C]