judgement:
CIVIL Appeal NO.
650 of 1982.
From the Award dated 6.3 1981 of the Labour Court Delhi in IClD No. 41 Or 1979.
P.N. Tewari and S.R. Srivastava for the Appellants.
25F read with Sec. 2(00) of the Industrial Disputes Act , 1947 ( 'Act ' for short) and as the provisions of Sec.
25F have not been complied with , the termination of service would be bad and illegal.
The Labour Court then proceeded to examine whether the relief of reinstatement should be granted or compensation in lieu of reinstatement should be given.
The Labour Court held that 'even where Sec.
25F of the Industrial Disputes Act is not complied with and therefore the termination of service is illegal and invalid , there is certainly a discretion with the Labour Court whether to order reinstatement of the workman or not. ' We have our serious reservations about the statement of law but it is not necessary to deal with it in the present case because instead of granting reinstatement , we propose to award adequate compensation taking into account both the backwages as well as compensation in lieu of reinstatement.
The Labour Court while proceeding to quantify the compensation observed that 'the termination of services of the two workmen was bonafide and not a colorable exercise of power in accordance with the service rules and then proceeded to award one year 's wages as compensation ' for the failure of the employer to comply with the requirements of provisions contained in Sec.
25F of the Act.
The workmen have filed this appeal by special leave.
Ordinarily where the termination of service is found to be 626 bad and illegal , in the field of industrial relations a declaration follows that the workman continues to be in service and has to be reinstated in service with full backwages (See Hindustan Tin Works Pvt. Ltd. vs Employees of Hindustan Tin Works Pvt.
Ltd.(1).
The Labour Court has , however , the discretion to award compensation instead of reinstatement if the circumstances of a particular case are unusual or exceptional so as to make reinstatement in expedient or improper.(See M/s Hindustan Steels Ltd. , Rourkela vs A.K. Roy & Ors.(2).
In the present case , the Labour Court having held that the termination of services of the appellants would constitute retrenchment and as the pre requisite for a valid retrenchment having not been satisfied , the termination of service was bad , yet in the facts of the case in his discretion declined to grant the relief of reinstatement.
Whenever , it is said that something has to be done within the discretion of the authority then that something has to be done according to the rules of reason and justice and not according to private opinion , according to law and not humour.
It is to be not arbitrary , vague and fanciful but legal and regular and it must be exercised within the limit to which an honest men to the discharge of his office ought to find himself.
(See Sharp vs Wekfield(3).
Discretion means sound discretion guided by law.
It must be governed by , rule , not by humour , it must not be arbitrary , vague and fanciful.
(See S.D. Jaisinghani vs Union of India & Ors.(4).
The Labour Court while declining to grant the relief of reinstatement which should have ordinarily followed , consequent upon its finding that the termination of service was bad and illegal , in exercise of its discretion awarded one year 's wages as compensation in lieu of reinstatement on the ground that 'the termination of service of each of the appellant was bonafide and not a colorable exercise of power in accordance with service rules. ' There is thus an error apparent on the face of the record of the case in as much as if the termination of service was according to service (1) ; (2) ; (3) 11891] A.C. 173.
(4) 11967] 2 S.C.R. 703 , 627 rules and Was bonafide it could not be simultaneously held to be illegal and invalid.
Therefore the discretion was exercised on irrelevant and extraneous considerations or considerations not germane to the determination.
As a necessary corollary , we would have granted the normal relief of reinstatement.
Dr. Chitley , learned counsel who appeared for the respondents attempted to take us through the evidence with a view to persuading us that the employer even if it acted contrary to law , should not be burdened with reinstatement because it had lost confidence in the appellants.
The employer is a foreign air transport company.
The workmen were loaders posted at Delhi Airport.
In this far fetched hierarchical relationship , loss of confidence if it is to be considered a relevant factor would have hardly impressed us.
However , as the workmen are out of job from August 30 , 1973 i.e. roughly for a period of 12 years , it is in their own interest , that instead of reinstatement in service under an unwilling if not a hostile employer.
adequate compensation would meet the ends of justice.
Therefore , in the special facts and circumstances of this case , though disagreeing with tile reasons given by the Labour Court for declining to grant the normal relief of reinstatement , we uphold the same but the meagre compensation awarded by the Labour Court namely one year 's E. wages requires to be adequately and properly modified.
Dr. Chiley gave us information about the last wages drawn by each of the workmen.
That does not take care of over time allowance or bonus or other benefits that they enjoy.
Roughly , the monthly pay packet of each workman appears to be around Rs. 1,000.
Each one of them was a loader which means doing 1 ' manual job.
Each one of them is entitled to backwages in full for a period of 12 years.
Each one was therefore entitled to get Rs. 1,50,000 towards back wages.
Adding to it the compensation in lieu of reinstatement in the amount of Rs. 50,000, we are of the opinion that a total compensation in the amount of Rs. 2,00,000 to each appellant would meet the ends of justice.
Before we conclude this judgment , we would like to make it abundantly clear that the compensation of Rs. 2,00,000 [I awarded to each appellant includes backwages for a period of 628 12 years.
Now that the amount is being paid in one lump sum , it is likely that the employer may take recourse to Sec.
192 of the Income Tax Act , 1961 which provides that when any person responsible for paying any income chargeable under the head 'Salaries ' shall , at the time of payment , deduct income tax on the amount payable at the average rate of income tax computed on the basis of the rates in force for the financial year in which the payment is made , on the estimated income of the assessee under this head for that financial year.
If therefore the employer proceeds to deduct the income tax as provided by Sec. 192 , we would like to make it abundantly clear that each appellant would be entitled to the relief under Sec.
89 of the Income Tax Act which provides that where , by reason of any portion of assessee 's salary being paid in arrears or in advance or by reason of his having received in any one financial year salary for more than 12 months or a payment which under the provisions of clause (3) of Section 17 is a profit in lieu of salary , his income is assessed at a rate higher than that it would otherwise have been assessed , the Income tax Officer shall on an application made to him in this behalf grant such relief as may be prescribed.
The prescribed relief is set out in Rule 21(A) of the Income tax Rules.
Both the appellants are entitled to the relief under Sec. 89 because compensation herein awarded includes salary which was in arrears for 12 years and it is being paid in one lump sum under the orders of this Court.
Therefore , the salary has to be spread over for a period of 12 years as also the compensation in lieu of reinstatement and the relief should be given as provided by Sec. 89 of the Income tax Act read with Rule 21(A) of the Income tax Rules.
Both the appellants are entitled to the same.
If any application is necessary to be made , the same may be made to the competent authority and the respondent employer shall assist the appellants in each case for obtaining the relief.
When the hearing concluded and we indicated that we were inclined to award compensation for backwages and in lieu of reinstatement , we requested Shri S.R. Srivastava , learned counsel for the appellants to give us in a tabulated form the compensation to which each appellant would be entitled with a spread over from the date of the order of termination of service till the end of the present year.
The tabulations have been supplied in respect of each of the appellants.
We have gone through the tabulations and 629 we are satisfied that they represent the correct state of affairs and they are taken on record and are being treated as part of this judgment.
Accordingly , this appeal is partly allowed and the award giving one year 's wages as compensation is modified to the effect that each appellant should be paid Rs. 2,00,000 as and by way of backwages and in lieu of relief of reinstatement.
As we have awarded adequate compensation , it is not necessary to award costs.
We order accordingly.
A.P.J. Appeal partly allowed.

summary:
The services of the appellants workmen who were employed as loaders in a foreign air transport company was terminated by the respondent employer.
On a reference made by the Secretary (Labour) Delhi Administration the Labour Court held that the termination of services of the appellants constituted retrenchment within the meaning of section 25F read with Section 2(oo) of the Industries; Disputes Act , 1947 and as the provisions of section 25F have not been complied with the termination of service would be bad and illegal.
It was further held that even where section 25F of the Act is not complied with and the termination of service is illegal and invalid , there is certainly a discretion with the Labour Court whether to order reinstatement of the workmen or not.
While quantifying the compensation , the Labour Court observed that the termination of services of the two workmen was bonafide and not a colourable exercise of power in accordance with the service rules and awarded one year 's wages as compensation for the failure of the employer to comply with the requirements of section 25F.
The workmen appealed to this Court.
Partly allowing the Appeal.
^ HELD; 1.
Ordinarily , where the termination of service is found to be bad and illegal , in the field of industrial relations a declaration follows that the workman continues to be in service and has to be reinstated in service with full backwages.
The Labour Court has however , the discretion to award compensation in respect of reinstatement if the circumstances of a particular case , are unusual or exceptional so as to make reinstatement inexpedient or improper.
[625H , 626A B] 624 2.
Whenever it is said that something has to be done within the discretion of the authority then that something has to be done according to the rules of reason and Justice and not according to private opinion , according to law and not humor.
It must not be arbitrary vague and fanciful.
[626D] Hindustan Tin Works Pvt , Ltd. vs Employees of Hindustan Tin Works Pvt. Ltd. [1979] I SCR 563 , M/s. Hindustan Steel Ltd. , Rourkela vs A.K Roy & Ors. ; , Sharp vs Wekfield , & S.D. Jaisinghani vs Union of India & Ors. ; , relied on.
Having regard to the facts and circumstances of the instant case , the reasons given by the Labour Court for declining to grant the normal relief of reinstatement are not tenable.
The order of the Labour Court is , however , upheld.
The award giving one year wages as compensation is modified to the effect that each appellant should be paid Rs. 2,00,000 as and by way of back wages in lieu of relief of reinstatement.
[626B C] 4.
The Labour Court while declining to grant the relief of reinstatement which should have ordinarily followed , consequent upon its finding that the termination of service was bad and illegal , in exercise of its discretion awarded one year 's wages as compensation in lieu of reinstatement on the ground that 'the termination of service of each of the appellant was bonafide and not a colourable exercise of power in accordance with service rules '.
There is thus an error apparent on the face of the record.
inasmuch as if termination of service was according to service rules and was bonafide it could not be simultaneously held to be illegal and invalid.
Therefore.
this discretion was exercised on irrelevant and extraneous considerations or considerations not germane to the termination.
[626F H , 627Al 5.
The appellants are entitled to relief under section 89 of the Income Tax Act , 1961 read with Rule 21(A) of the income Tax Rules , 1962 because compensation herein awarded includes salary which was in arrears for 12 years and is being paid in one lump sum under orders of Court.
Respondent employer shall assist the appellants for obtaining the relief.
[628E F]


judgement:
he notification dated February 8 , 1984 issued by the State Government under section 52 ( 1) of the Act became effective the moment it was published in the Official Gazette as thereupon the notified land became vested in the State Government free from all encumbrances.
It was not necessary for the respondents to plead the service of notice on them by the Special Officer , Town Planning Department , Jaipur under section 52 (2) for the grant of an appropriate writ , direction or order under article 226 of the Constitution for quashing the notification issued under section 52 (1).
If the respondents felt aggrieved by the acquisition of their lands at Jaipur and wanted to challenge the validity of the impugned notification issued by the State Government of Rajasthan under section 52 (1) , by a petition under article 226 , the remedy of the respondents to file such a petition lay before the Rajasthan High Court Jaipur Bench , where the cause of action wholly or in part arose.
[605F H; 606A] & CIVIL APPELLATE JURISDICTION: Civil Appeal NO.
2085 Of 1985.
From the Judgment and Order dated 13.3.1984 of the Calcutta High Court in C. P. NO.
5972 (W) of 1984.
K Parasaran , Attn.
and Badridas Sharma for the Appellants.
G.L. Sanghi , Praveen Kumar and Ashok Mathur for the Respondents.
The Judgment of the Court was delivered by SEN. , J.
The issue involved in this appeal by special leave is: Whether the service of notice under sub section
(2) of section 52 of the Rajasthan Urban Improvement Act , 1959 ( 'Act ' for short) served on the respondents at their registered office at 18 B , Brabourne Road , Calcutta by the Special Officer , Town Planning Department , Jaipur was an integral part of the cause of action and was sufficient to invest the Calcutta High Court with jurisdiction to entertain a petition under article 226 of the Constitution challenging the validity of a notification dated February 8 , 1984 issued by the State Government of Rajasthan under S 5 (21) of the Act for the acquisi 601 tion of certain lands belonging to them required by the Urban Improvement Trust , Jaipur for a public purpose, namely, for implementation of a development scheme viz. Civil Lines Extension Scheme.
It is somewhat strange that a learned Single Judge of the Calcutta High Court (R.N.Pyne, J.) should have by his order dated March 13, 1984 entertained a petition under article 226 of the Constitution filed by the respondents , issued a rule nisi thereon requiring the reasons as to why a writ in the nature of mandamus should not be issued directing the appellants herein, the State of Rajasthan, the Jaipur Development Authority, Jaipur and the Land Acquisition Officer, Jaipur to forbear from giving effect to the impugned notification dated February 8, 1984 and passed an ad interim exparte prohibitory order restraining them from taking any steps requiring the respondents under sub section
(5) of 52 of the Act to surrender or deliver possession of the lands acquired forthwith or upon their failure to do so to take immediate steps under sub section
(6) thereof to secure such possession.
We are distressed to find that the learned Single Judge despite a long line of decisions of this Court starting from Siliguri Municipality vs Amalendu Das (1) deprecating the practice prevalent in the High Court of passing such interlocutory orders for the mere asking , should have passed the impugned orders in the manner that he did.
It seems that the pronouncements of this Court have had little exact on the learned Single Judge.
The learned Attorney General appearing for the State of Rajasthan takes serious exception to the authority and jurisdictionof the learned Single Judge to have entertained the writ petition filed by the respondents and issued the rule nisi and to have made the ad interim exparteprohibitory order which virtually has brought the entire acquisition proceedings pending at Jaipur in the State of Rajasthan to a standstill.
He contends that the petition filed by the respondents purporting to be under article 226 of the Constitution in the Calcutta High Court and the rule nisi thereon and the ad interim exparte prohibitory order secured by them on the basis of such petition from the learned Single Judge on March 13, 1984 when there was total lack of inherent jurisdiction on the part of (1) ; , 602 the Calcutta High Court to entertain such petition , constitutes a flagrant abuse of the process of the Court.
There is , in our opinion considerable force in this submission.
The facts of the case are as follows: Messrs Swaika Properties Pvt.
Limited, Calcutta owned Khasra No. 383 area 14 bighas 16 biswas situate in village Madrampura on the outskirts of Jaipur city.
On June 25, 1975 the Special Officer , Town Planning Department, Jaipur issued a notice under section 52 (2) of the Act at the instance of the Improvement Trust, Jaipur stating that it was proposed by the State Government to acquire the said land admeasuring more or less 44,770 square yards under section 52 (1) of the Act for a public purpose, namely, for the implementation of a development scheme at public expense viz. the Civil Lines Extension Scheme, The said notice was duly served on the respondents and they in compliance therewith appeared before the Special Officer, Town Planning Department, Jaipur and filed their reply dated September 8, 1975.
In the reply, the respondents while denying the existence of a public purpose for acquisition of the lands under section 52(1) of the Act asserted that they needed the said land to start new businesses in the State of Rajasthan and for that purpose to utilize the notified land for establishment of a branch office and for construction of residential houses for their Director and other Senior Executives.
The Special Officer adjourned the case from time to time and issued several notices to the respondents for personal hearing under section 52 (3) of the Act.
The respondents through their representative appeared at each of these hearings and sought adjournment on one pretext or another.
Significantly although the respondents participated in the proceedings before the Special Officer, they did not raise any objection as to the power and authority of the State Government of Rajasthan to acquire the notified land under section 52 (1) of the Act or the legality and propriety of the notice issued by the Special Officer under s , 52 (2) or his jurisdiction to proceed with the inquiry under section 52 (3).
Nor did the respondents place any material before the Special Officer to show that they really needed the notified land for the purpose of expansion of their business activities to the State of Rajasthan.
It is pertinent to observe that the respondents had been shifting their stand before the Special Officer.
As already stated , they had in their reply dated September 8, 1975 alleged that they genuinely required the land for starting new businesses in the State , to open a branch office at Jaipur and 603 to construct residential quarters for their Director and other Senior Executives , but at a later stage they alleged that they wanted to construct a Three Star Hotel on the said land.
Eventually , the Special Officer by his order April 9 , 1976 held that the alleged need of the respondents was just a pretence and he was satisfied on the material on record that the land was really not needed by them bona fide and their real object was just to get the land released from acquisition on one ground or the other.
with these observations he rejected the prayer of the respondents for release of the land and recommended that the entire land be acquired by the State Government under section 52(1) of the Act for the Urban Improvement Trust , Jaipur , and forwarded the papers to the Secretary to the State Government , Town Planning Department , Rajasthan for issue of the requisite notification under section 52 (l) of the Act.
It appears from the material on record that the respondents having failed in their effort to get the land released from acquisition then took up the matter with the State Government.
They made an application to the State Government on February 10 , 1977 seeking exemption of the notified land under section 20 of the Urban Land (Ceiling & Regulation) Act , 1976 stating that they required the land for construction of a Three Star Hotel.
The State Government in the Urban Development & Housing Department by letter dated April 4 , 1977 informed the respondents that there was no possibility of an exemption being granted under section 20 of the Act in their favour allowing them to retain vacant land in excess of 6,000 square yards for the construction of a Three Star Hotel.
The State Government stated that the remaining land was required by the Urban Improvement Trust , Jaipur for development of house sites and for construction of two 'Ministers ' bungalows in Civil lines and therefore the proceedings for acquisition of the notified land would not be withdrawn.
The State Government required the respondents to submit detailed proposals in respect of 6,000 square yards of land for their proposed Three Star Hotel showing commitments made, financial resources etc.
through the Director of Tourism, Rajasthan, Jaipur and were intimated that they would be entitled to retain the said land on payment of the prescribed fee for converting the land use from agriculture to hotel business.
Apparently, the respondents were not serious in undertaking the 604 new venture of starting a Three Star Hotel on an area of 6,000 square yards as their real object was to get the notified land released from acquisition.
The February 21, 1979, there was a meeting at the Secretariat in the Urban Development & Housing Department between officers of that Department and those of the Urban Improvement Trust, Jaipur.
It was clarified on behalf of the Improvement Trust that the notified land in its entirety was needed for implementation of the development scheme of the Trust.
The Improvement Trust accordingly by its letter dated March 5, 1979 requested the State Government that necessary orders be passed for acquisition of Khasra No. 383 in village Madrampura admeasuring 14 bighas 16 biswas and a notification to that effect issued under section 52(1) of the Act.
It was pointed out that a public notice under section 55(2) of the Act as regards the notified land had already been issued by the Special Officer , Town Planning Department , Jaipur dated June 25 , 1975 , and the necessary procedure as laid down in sub S.(3) thereof followed.
As a result of this , the State Government issued the impugned notification dated February 8 , 1984 under section 52(1) Or the Act and the notified land vested in the State Government free from all encumbrances.
The State Government in their special leave petition have explained that the notification under section 52(1) of the Act could not be issued till February 8 , 1984 because the Government were primarily thinking of making the land available for construction of residential houses before making provisions for construction of a Three Star or Five Star Hotel but nothing came out of the said proposal as there was no response from the respondents.
Upon these facts , we are satisfied that the cause of action neither wholly nor in part arose within the territorial limits of the Calcutta High Court and therefore the learned Single Judge had no jurisdiction to issue a rule nisi on the petition filed by the respondents under article 226 of the Constitution or to make the ad interim exparte prohibitory order restraining the appellants from taking any steps to take possession of the land acquired.
Under sub section
(5) of section 52 of the Act the appellants were entitled to require the respondent to surrender or deliver possession of the lands acquired forthwith and upon their failure to do so , take 605 immediate steps to secure such possession under sub section
(6) thereof.
The expression 'cause of action ' is tersely defined in Mulla 's Code of Civil Procedure: "The 'cause of action ' means every fact which , if traversed , it would be necessary for the plaintiff t y prove in order to support his right to a judgment of the Court.
" In other words , it is a bundle of facts which taken with the law applicable to them gives the plaintiff a right to relief against the defendant.
The mere service of notice under section 52(2) of the Act on the respondents at their registered of ice at 18 B , Brabourne Road , Calcutta i.e. within the territorial limits of the State of West Bengal , could not give rise to a cause of action within that territory unless the service of such notice was an integral part of the cause of action.
The entire cause of action culminating in the acquisition of the land under section 52(1) of the Act arose within the State of Rajasthan i.e. within the territorial jurisdiction of the Rajasthan High Court at the Jaipur Bench.
The answer to the question whether service of notice is an integral part of the cause of action within the meaning of article 226(2) of the Constitution must depend upon the nature of the impugned order giving rise to a cause of action.
The notification dated February 8 , 1984 issued by the State Government under section 52(1) of the Act became effective the moment it was published in the official Gazette as thereupon the notified land became vested in the State Government free from all encumbrances.
It was not necessary for the respondents to plead the service of notice on them by the Special Officer , Town Planning Department , Jaipur under section 52(2) for the grant of an appropriate writ , direction or order under article 226 of the Constitution for quashing the notification issued by the State Government under section 52(1) of the Act.
If the respondents felt aggrieved by the acquisition of their lands situate at Jaipur and wanted to challenge the validity of the notification issued by the State Government of Rajasthan under section 52(1) of the Act by a petition under article 226 of the Constitution , the remedy of the respondents of the grant of such relief had to 606 be sought by filing such a petition before the Rajasthan High Court , Jaipur Bench , where the cause of action wholly or in part arose.
It is to be deeply regretted that despite a series of decisions of this Court deprecating the practice prevalent in the High Court of passing such interlocutory orders for the mere asking , the learned Single Judge should have passed the impugned ad interim exparte prohibitory order the effect of which , as the learned Attoreny General rightly complains , was virtually to bring to a standstill a development scheme of the Urban Improvement Trust , Jaipur viz. Civil Lines Extension Scheme , irrespective of the fact whether or not the High Court had any territorial jurisdiction to entertain a petition under article 226 of the Constitution.
Such arbitrary exercise of power by the High Court at the public expense reacts against the development and prosperity of the country and is clearly detrimental to the national interest.
Quite recently , Chinnappa Reddy , J. speaking for the Court in Assistant Collector of Central Excise , West Bengal vs Dunlop India Limited and Ors.(1) administered strong admonition deprecating the practice of the High Court of granting ad interim exparte orders which practically have the effect of the grant of the main relief in the petition under article 226 of the Constitution irrespective of the fact whether the High Court had any territorial jurisdiction to entertain such a petition or whether the petition under article 226 was intended and meant to circumvent the alternative remedy provided by law or filed solely for the purpose of obtaining interim orders and thereafter delaying and protracting the proceedings by one device or the other particularly in matters relating to public revenue or implementation of various measures and schemes undertaken by the Government or the local authorities for general public benefit.
Although the powers of the High Courts under article 226 of the Constitution are far and wide and the Judges must ever be vigilant to protect the citizen against arbitrary executive action , nonetheless , the Judges have a constructive role and therefore there is always the need to use such extensive powers with due circumspection.
There has to be in the larger public interest an clement of self ordained restraint.
We hope (1) [19851 1 S.C.C. 260. 607 and trust that the High Court will determine the extent of its territorial jurisdiction before making such interlocutory orders.
In the result , the appeal succeeds and is allowed with costs.
The impugned orders passed by the learned Single Judge of the Calcutta High Court dated March 13 , 1984 issuing a rule nisi on the petition filed by the respondents under article 226 of the Constitution and the ad interim exparte prohibitory order made by him are set aside and the proceedings before the Calcutta High Court are quashed.
We quantify the costs at Rs. 5,000.
N.V.K. Appeal allowed.

dataset_name: IN-Abs

summary:
The Special Officer , Town Planning Department , Jaipur issued a notice under section 52 (2) of the Rajasthan Urban Improvement Act , 1959 at the instance Or the Improvement Trust to the respondent company which owned extensive land on the outskirts of Jaipur City stating that it was proposed by the State Government to acquire the said land under 9. 52 (1) for a public purpose , the implementation of a developing scheme at public expense viz. the Civil Lines Extension Scheme , and the said notice was duly served on the respondents at their registered office at 18B , Brabourne Road , Calcutta.
In compliance therewith , the respondents appeared before the Special Officer and while denying the existence of a public purpose for acquisition of the said land under section 52 (1) of the Act , asserted that they needed the land to start new business in the State of Rajasthan viz. for establishment of a branch office , construction of residential houses for their Director and Senior Executives etc.
The Special Officer on being satisfied from the material on record that the alleged need of the respondents was not bona fide and that the land was required by the Improvement Trust for a public purpose viz. the Civil Lines Extension Scheme , recom 599 mended that the entire land be acquired under section 52 (1) of the Act.
Having failed in their effort to get the land released from acquisition , the respondents made an application to the State Government under section 20 of the Urban Land (Ceiling purview of that Act alleging that the land was needed for constructing a three star hotel , but it appears that they were not serious in undertaking any such venture.
While the matter was under the consideration of the State Government , the Improvement Trust represented that the notified land in entirety was needed for the aforesaid development scheme and accordingly the State Government issued the impugned notification.
The respondent company approached the Calcutta High Court by a writ petition.
A Single Judge entertained the petition under article 226 , issued a rule nisi to the appellants to show cause why a writ of mandamus should not be issued , and also passed an ex parte ad interim prohibitory order restraining them from taking any step to require the respondents to surrender or deliver possession of the lands acquired.
Allowing the Appeal , ^ HELD: 1. 1.
Normally , the High Court should not , as a rule , in proceedings under article 226 of the Constitution grant any ad interim prohibitory order staying the implementation of any development scheme framed by the Government or by the local authorities , save under very exceptional circumstances and particularly without notice to the Government or such authority.
The Court deprecated the tendency on the part of the High Court in spite of a long line of decisions of this Court starting from Siliguri Municipality vs Amalendu Das , ; to grant interlocutory orders for the mere asking.
[60IB E] 1.
2 Although the powers of the High Courts under Art 226 are far and wide and the Judges must ever be vigilant to protect the citizen against arbitrary Executive action , nevertheless , the Judges have a constructive role to play and therefore there is always the need to use such extensive powers with due circumspection There has to be in the larger public interest an element of self ordained restraint.
The effect of the impugned ad interim prohibitory order made by the learned Single judge virtually brought to 3 standstill a development scheme framed by the Improvement Trust in another State.
Such arbitrary exercise of power by the High Court , at the public expense , reacts against the development and prosperity of the country and is clearly detrimental to the national interest.
[606G H]; C D] G 2. 1.
The question whether service of notice is or is not an integral part of the cause of action within Art 226 (2) of the Constitution must depend upon the nature of the impugned order giving rise to a 'cause of action '.
'Cause of action ' is a bundle of facts which taken with the law applicable to them gives the petitioner a right to relief against the respondent.
[60SE , B C] 600 2 .2
There was complete lack of jurisdiction on the part of the Calcutta High Court to have entertained the writ petition.
The service of notice under section 52 (2) of the Act was not an integral part of the cause of action within the meaning of article 226 (2) of the Constitution and therefore the High Court had no jurisdiction to entertain the writ petition or issue an ad interim prohibitory order.
[601H 602A , 605D]


judgement:
Civil APPEAL NOS.
2144 2145 of 1970 From the Judgment and Decree .
13/14/24.3.69 of the High Court of Gujarat in First Appeal Nos.
981/60 & 270/61.
M.N. Phadke , Girish Chandra , C. V. Subba Rao and R.N Poddar for the Appellant.
Mr. V. Gouri Shankar.
K.L. Harhi , M.K. Arora and Ms. II Wahi , for the Respondent.
The Judgment of the Court was delivered by , BALAKRISHNA ERADI , J.
These two appeals have been filed by the State of Gujarat on the strength of a certificate granted by the High Court of Gujarat under Article 133 (1) (c) of the Constitution of India as it stood prior to the Amendment of 1972.
Dhrangadhra was a princely State in Kathiawar region ruled by a Maharaja , until April , 1948 , when pursuant to the covenant entered into by the Maharaja with the Government of India it became merged in the newly formed State of Saurashtra On January 29 , 1937 , an agreement had been entered into between the Dhrangadhra Chemical Works Ltd. , (hereinafter called the 'defendant company ' ) and the Maharaja of Dhrangadhra where under the defendant company purchased from the Government of Maharaja , Shree Shakti Alkali Works in Dhrangadhra and the Salt Works at Kuda with exclusive rights to manufacture salt at the Kuda Works on certain conditions.
That agreement was subsequently modified as per the Minutes of the Board of Directors of the defendant company recorded on April 5 , 1953.
After the 633 merger of the Dhrangadhra State in the State of Saurashtra , the aforesaid agreement was further modified by an agreement dated January 4 , 1950 entered into between the defendant company and the Government of Saurashtra.
It is with that agreement alone that we are concerned with in these appeals.
Under that agreement , the defendant company agreed to pay to the Government of Saurashtra royalty at the rate of Rs. 0 2 3 (2 annas , 3 pies) per Bengal Maund on the total quantity of salt sold by them every year.
The payment of royalty was to be made as and when delivery was given by the defendant company to the purchaser.
Under clause (3) of the said agreement the defendant company agreed to manufacture a minimum quantity of at least 50 , 000 tons of salt every year in addition to the quantity required by the defendant company for consumption if there Alkali factory.
Clause (5) of the agreement provided for the payment of a minimum royalty , equivalent to an amount chargeable on the minimum quantity to be manufactured by the defendant company in accordance with clause (3).
There was a short fall in the production of salt by the company for the years 1950 53 aggregating to 27300 0 54 tons.
The royalty payable in respect of the said quantity of salt calculated at the agreed rate of 2 annas , 3 pies per Bengal Maund amounted to Rs. 1,07, 495 10 0.
Differences arose between the Government of Saurashtra and the defendant company with respect to the royalty payable under the agreement.
The said dispute mainly centered round two points.
According to the Government , irrespective of the quantity of salt actually sold by the company during any year , the company was bound to pay a minimum guarantee royalty in 1 respect of 50,000 tons of salt by virtue of the combined operations of clauses (3) and (5) of the agreement The stand taken by the defendant company that clause (3) of the agreement was void due to vagueness and uncertainty and since clause (5) was dependent for its operation on clause (3) , the said clause (5) was also vide due to vagueness.
According to the defendant company their liability to pay royalty was only under clause (2) , whereunder royalty was realizable by the Government only on the total amount of salt actually sold and delivered by the defendant company in each year.
In spite of repeated demands made by the Government of Saurashtra , the defendant company persisted in its aforesaid stand.
While matters stood thus , that as a result of the State reorganization of 634 1956 , the State of Bombay became the successor state to the State of Saurashtra.
The State of Bombay instituted the suit out of which these two appeals have arisen in the Court of Civil Judge , Senior Division , Surendranagar seeking to recover Rs. 506,959 5 0 with interest at 6 per cent per annum from the date of suit by way of royalty claimed to be payable by the defendant company on the terms of the aforesaid agreement of 1950.
In defence to the suit , the defendant company reiterated the position it had taken in response to the claims made on it by the Government of Saurashtra namely , that clauses (3) and (5) of the agreement were vague and void and that under clause (2) its liability was to pay royalty only on the actual amount of salt sold by the company during each year: The basis of the claim put forward by the plaintiff was that during the years when there was a short fall in the production , the company was bound to pay royalty on the minimum guaranteed quantity of 50,000 tons of salt and that a sum of Rs. 1,07,495 10 0 was due on this account.
It was further urged on behalf of the plaintiff that on a proper construction of clause (2) of the agreement , the liability of the company was to pay royalty not on the quantity of salt sold and delivered by them during the years when more than the minimum quantity stipulated in clause (3) had been manufactured but on the actual quantity manufactured by the company irrespective of whether any portion thereof remained unsold .
The Trial Court after a careful and detailed consideration of the terms of the agreement as well as all the relevant aspects of the case to the conclusion that the defendant company is liable to pay royalty on the minimum quantity of 50,000 tons in respect of each year in which the production of salt was less than 50,000 tons after excluding the quantity require(l for consumption in their own factory.
For the years during which the production exceeded the stipulated minimum of 50,000 tons, the Trial Court held that royalty was chargeable only on the quantity of salt sold and delivered by the company and not on the total quantity manufactured by it.
In this view it passed a decree in the plaintiff favour for a sum of Rs. 2,66,462 0 9 and dismissed the suit in respect of the remaining part of the plaintiff 's claim.
635 While the matter was pending in the Trial Court , the bifurcation of the State of Bombay had taken place and the area in question became the part of the territory of the State of Gujarat and the State of Gujarat bad been substituted as plaintiff the suit.
Both the defendant company as well as the State of Gujarat filed appeals in the High Court questioning the correctness of the aforesaid judgment and the decree of the learned Civil Judge.
First Appeal No. 981 of 1960 was appeal filed by the defendant company and First Appeal No.270 of 1961 was State 's appeal.
Both these appeals were heard together by the Division Bench of the High Court and they were disposed of under the judgment now impugned before us.
The High Court on a consideration of clauses (2) , (3) and (5) of the agreement was of opinion that even though clause (5) dealt with a particular contingency namely , the failure of the defendant company to manufacture minimum quantity of salt as specified in clause (3) , it was "introduced by way of abundant caution and not by way of limiting the ambit and scope of the operative part of the agreement namely , clause 2.
In the view of the High Court , clause (5) could not be regarded as controlling clause (2) and the liability of the defendant company to pay royalty to Government rested solely upon the terms of clause (2).
In this view the High Court held that merely on account of the fact that the defendant company had during certain years failed to manufacture the minimum quantity of salt stipulated in clause (3) , it could not be saddled with liability for payment of royalty during those years since under clause (2) royalty was to be paid only on the quantity of salt actually sold and delivered.
The Division Bench of the High Court concerned with the Trial Court in the view taken by it that under clause (2) the charge to royalty would get attracted not by mere manufacture alone but only at the point of sale and delivery of the salt to the purchasers.
On the basis of the foregoing conclusions reached by it , the High Court set aside the decree passed by the learned Civil Judge and dismissed a suit except regarding an amount of Rs. 16,631 which had been admitted by the defendant company to be payable by it to the plaintiff Aggrieved by the said decision of the High Court , the State of Gujarat has preferred these two appeals before this Court.
636 After hearing arguments on both sides and scrutinizing the terms of the agreement dated January 4, 1950 , we have unhesitatingly come to the conclusion that the High Court was not right interfering with the decree passed by the learned Civil Judge.
Since the points raised in the appeals turn on the interpretation to be placed on the clauses (2) to (5) , we shall reproduce those clauses in full.
They read "2.
The company shall pay a royalty to the Government at the rate of 0 2 3 per Bengal maund on the total quantity a of salt sold by them every year.
The amount of royalty under this clause shall be paid by the company as and when delivery is given by the company to the purchaser , and for the purposes of ascertaining the royalty chargeable under this clause the company shall produce the sale notes , delivery notes and such other documents or records as may be required by an Officer authorized by Government in this behalf.
The company shall manufacture at least 50,000 tons of salt in addition to the quantity required for consumption in their works.
However , if it become impossible to produce the minimum quantity of salt required to be produced by this clause on account of natural circumstances beyond the control of the company Government may relax this requirement to such extent as may be deemed fit by Government in view of such circumstances.
The company shall make all efforts to raise the production of salt above the minimum specified in clause 3 above.
In case company fails to manufacture the minimum quantity of salt as specified in clause (3) above and Government do not think it fit to relax the requirements of the said clause in accordance with the pro visions mentioned therein , then notwithstanding any thing contained in clause 2 above the company shall 637 pay the minimum royalty equivalent to an amount chargeable on the minimum quantity to be manufactured in accordance with clause (3) of this agreement.
" We do not find possible to agree with the High Court that clause (3) was only 'introduced by way of abundant caution ' and that clause(5) does not create any liability for payment of a minimum royalty.
On a combined reading of clauses (2) to (5) , it appears to us to be clear that while clause (2) was intended to operate and govern the rights and liabilities of the parties in respect of payment of royalty during years when the company maintained its normal scale of production , clauses (3) and (5) had been deliberately inserted with the object and purpose of ensuring that even in respect of lean years when the production of salt by the company fell short of the stipulated minimum of 50,000 tons after excluding the quantity required for the consumption in the company 's own factory , the Government was to be paid a minimum guaranteed royalty equivalent to the amount chargeable on 50,000 tons of salt which is stipulated as the minimum quantity to be manufactured under clause (3).
The interpretation put on clause (2) by the High Court has the result of completely rendering clauses (3) and (5) otiose and such interpretation does not commend itself to us.
We do not also find it possible to agree with the view expressed by the High Court that the liability for payment of royalty emanated only from clause (2).
No doubt clause (2) is the principal clause providing for the payment of royalty but it was to be operative in respect of years when the production of salt by the company fell within the normal limits , that is above the stipulated minimum.
Clause (S) is a special provision for payment of a minimum guaranteed royalty in respect of periods when the production of salt by the company fell short of the quantity stipulated in clause (3).
Hence there is no conflict between clauses (2) and (5); on the contrary , they supplement each other.
We are , therefore , constrained to hold that the High Court was in error in its conclusion that in respect of years when the company failed to produce the minimum quantity of salt stipulated in clause (3) , it was under no liability at all to pay any royalty to the Government under clause (5).
The Trial Court was , in our opinion , perfectly right in granting a decree to the plaintiff for the amount of royalty payable in respect of the short fall in production during the years 1950 53.
There remains only the further question , whether under the 638 terms of clause (2) , the royalty payable thereunder is to be computed on the total amount of salt manufactured by the company or on the quantity sold and delivered.
In our opinion , the terms of the clause are absolutely clear and provide for levy and collection of royalty only when the salt is sold and delivered by the company to the purchasers.
This obviously means that royalty can be charged only on the quantity actually sold and delivered by the company and not on the total quantity manufactured by it during the particular year.
The concurrent findings recorded on this point by the High Court and the learned Civil Judge do not , therefore , call for any interference.
In the result , we allow these appeals , set aside the judgment of the High Court and restore the judgment and decree of the learned Civil Judge subject to the modification that the rate of interest payable to the plaintiff on the decree amount shall be 12 per cent from the date of the trial Court.
The costs incurred by the appellant in this Court in these appeals will be paid by the respondent.
The appellant will also get its full costs from the respondent in the High Court in First Appeal No.981 of 1960.
The defendant company will bear its own costs in the Trial Court as well as in the High Court.
The plaintiff will get proportionate costs in the Trial Court while the defendant will bear its own costs.
S.R. Appeals allowed.

summary:
On January 29, 1937 an agreement had been entered into between the Dhangadhra Chemical Works Ltd. and the Maharaja of Dhrangadhra whereunder the company purchased from the Government of Maharaja Shakti Alkali Works in Dhrangadhra and the Salt Works at Kuda with exclusive rights to manufacture salt at the Kuda Works on certain conditions.
In April 1948 , the princely State of Dhrangadhra got merged in the newly formed State of Saurashtra.
By a further agreement dated January 4 , 1950 entered into between the company and the Government Saurashtra , the company agreed to ply to the Government of Saurashtra royalty at the rate of Rs. 0 2 3 (2 annas , 3 pies) per Bengal Maund on the total quantity of salt sold by them every year.
The payment of royalty was to be made as and then delivery was given by the respondent company to the purchaser Under clause 3 of the said agreement the respondent company agreed to manufacture a minimum quantity of at least 50,000 tons of salt every year in addition to the quantity required by the respondent company for consumption in their Alkali factory.
Clause 5 of the agreement provided for the payment of a minimum royalty equivalent to an amount chargeable on the minimum quantity to be manufactured by the respondent company in accordance with clause 3.
For the years 1950 53 , there was a short fall in the production of salt by the respondent company aggregating to 27300 0 54 tons , and the respondent company made payments of royalty in terms of clause 2 of the agreement and refused to pay the minimum guaranteed royalty on 50,000 tons taking the stand that clause 3 of the agreement was void due to vagueness and uncertainty and since clause 5 was dependent for its operation on clause 3 the said clause 5 was also void due to vagueness.
In spite of repeated demands the respondent company persisted in its stand , 631 The State of Bombay , which became the successor State to the State of Saurashtra in 1956 therefore , instituted the suit in the court of Civil Judge , Senior Division , Surendranagar seeking to recover a sum of Rs. 506, 959 5 O with interest at 6 per cent per annum from the date of suit by way of royalty payable by the respondent company.
The trial court , after a careful and detailed consideration of the terms of the agreement as well as all the relevant aspects of the case came to the conclusion that the respondent company was liable to pay royalty on the minimum quantity of 50 , 000 tons in respect of each year in which the production of salt was less than 50,000 tons after excluding the quantity required for consumption in their own factory and that for the years during which the production exceeded the stipulated minimum of 50,000 tons, royalty was chargeable only on the quantity of salt sold and delivered by the company and not on the total quantity manufactured by it.
In this view it passed a decree in favour of the appellant which during the tendency of the trial became the successor Government to State of Bombay on bifurcation of the State for a sum of Rs. 2,66,462 0 9 and dismissed the appellants ' claim.
While , concurring with the trial court the view taken by it that under clause 2 charge to royalty wound get attracted not by mere manufacture alone but only at the point of sale and delivery of the salt to the purchasers , the High Court of Gujarat took the view in the two first and cross Appeals , that clause 5 could not be regarded as controlling clause 2 and the liability of the respondent company to pay royalty to government rested solely upon the terms of clause 2 and had that merely on account of the fact that the respondent company had during certain years failed to manufacture the minimum quantity of salt stipulated in clause 3 , it could not be saddled with liability for payment of royalty during those years since under clause 2 royalty was to be paid only on the quantity of salt actually sold and delivered.
The High Court .
accordingly set aside the decree passed by the trial court and dismissed the appellant 's suit , except regarding an amount of Rs. 16 , 631 which had been admitted by the respondent company to be payable by it to the appellant.
Hence the two State appeals by certificate granted by the High Court under Article 133 (1) (c) of the Constitution , as it stood prior to the Amendment of 1972.
Allowing the appeals , the Court F ^ HELD: 1.
On a combined reading of clauses 2 to 5 of the Agreement dated 4.
50 it is clear , that while clause 2 was intended to operate and govern the right , and liabilities of the parties in respect of payment of royalty during years when the company maintained its normal scale of production , clauses 3 and 5 had been deliberately inserted with the object and purpose of ensuring that even in respect of lean year when the production of salt by the company fell short of the stipulated minimum of 50,000 tons after excluding the quantity required for the consumption in the company 's own factory, the government was to be paid a minimum guaranteed royalty equivalent to the amount chargeable on 50,000 tons of salt which is stipulated as the minimum quantity to be manufactured under clause 3.
The interpretation put on clause 2 by the High Court the result of completely rendering clause 3 and 5 otiose.
[637B D] 632 2.
No doubt clause 2 is the principal clause providing for the payment of royalty but it was to be operative in respect of years when the production of salt by the company fell within the normal limits , that is above the stipulated minimum Clause 5 is a special provision for payment of a minimum guaranteed royalty in respect of periods when the production of salt by the company fell short of the quantity stipulated in clause 3.
Hence there is no conflict between clauses 2 and 5; on the contrary , they supplement each other.
[637E F3 3.
The terms of clause 2 are absolutely clear and provide for levy and collection of royalty only when the salt is sold and delivered by the company to the purchasers.
This obviously means that royalty can be charged thereunder only on the quantity actually sold and delivered by the company and not on the total quantity manufactured by it during the particular years.
[638A B]


judgement:
ivil Appeal Nos.
2263 to 2268 of 1984.
From the Judgment and Order dated 2nd April , 1982, of the High Court of Karnatka in Writ Appeal Nos. 662 to 667 of 1982.
663 Writ Petition Nos.
394 405 of 1984.
(under Article 32 of the constitution).
K. Srinivasan , Raghvendra Rao , V. Kumar for the Appellants.
in the C.A. Nos.
2263 68 of 1984.
R.P. Bhatt , Swaraj Kaushal for the Respondents in C.A. Nos.
2263 68 of 1984.
B Krishnamani , Lalit Kumar Gupta , Subash Dutt , K.K Pargal and Pankaj Kalra , for the Petitioner in W.P. No. 391 405/84.
K.L. Sharma , S.L. Benadikar and M. Veerappa for the Respondents in W.P. No. 394 405/84.
C The Judgment of the Court was delivered by KHALID , J.
The above appeals , by special leave, are directed against the common Judgment rendered by a Division Bench of the Karnataka High Court in writ appeal Nos.
662 668 of 1982.
In the writ petitions , the prayer is to strike down Section 7 of Karnataka Act No. 13 of 1982, Sections 2 and 3 of Karnataka Act No. 10 of 1984 and for a writ of mandamus to restrain the State of Karnataka from enforcing the said provisions against the Petitioners in the writ petitions.
This Judgment will dispose of the appeals and the writ petitions.
The facts , in brief , necessary to understand the genesis of the cases are as follows: Consequent upon the abolition of octroi by the State of Karnataka , which was the main source of revenue for the local bodies , the said State enacted the Karnataka Tax on Entry of Goods into local areas for Consumption , use or salt therein Act , 1979 (for short the 1979 Act) in order to augment the resources of the local bodies.
This Act came into force with effect from 1.6.1979 on which date it was gazetted.
3.A batch of 1590 writ petitions were field in the Karnataka High Court by a large number of traders challenging the constitutional validity of this Act.
Writ Petition No , 7039 of 1979 was one of them which was by Messrs Hansa Corporation , Bangalore.
These writ petitions, on reference by a learned Single Judge , were heard by a Division Bench , which by a common 664 Judgment dated 24.8.1979(T) struck down the Act , allowed the writ petition and issued writs of mandamus against the State Government forbearing it from taking any proceeding under the Act.
The State took the matter in appeal to this Court.
However only one appeal was filed , numbered as 3049 of 1979 against writ petition No. 7039 of 1979 filed by Messrs Hansa Corporation , in , pleading this Corporation alone as respondent , This Court by its Judgment dated 25.9.1980 allowed the appeal , set aside the Judgment of the Karnataka High Court and upheld the validity of the Act.
This decision is reported in ; 4.
While Civil appeal No. 3049 of 1979 was pending before this Court , the Governor of Karnataka promulgated the Karnataka Tax on Entry of Goods into a Local Area for Consumption , use or Sale therein Ordinance of 1980 (Karnataka Ordinance No. 5 of 1980) on 8.6.1980 providing for levy of entry tax on registered dealers , removing the infirmities in the 1979 Act , that were pointed out by the High Court in its Judgment while striking down the Act.
This ordinance was replaced by Act No. 21 of 1980 giving it retrospective effect from 8 6.1980 , the date of the ordinance .
After this Court rendered its Judgment in the Hansa Corporation case , the Governor of Karnataka promulgated another ordinance , Ordinance No. 11 of 1980 on 25.10.l980 re pealing the Entry Tax Act , 1980 , from its inception with certain other directions regarding adjustment of tax if any paid.
This was followed by Karnataka Tax on Entry of Goods into Local Areas , Use or Sale therein (repeal) Act, of 1981 , and Karnataka Act No. 10 of 1981 , repealing the 1980 Act.
This Act , however , did not repeal ordinance No. 11 of 1980.
In the meantime , Karnataka Ordinance No. 3 of 1981 , came into force which was followed by Karnataka Act 12 of 1981 which repealed Ordinance No. 11 of 1980.
As a result of the combined operation of ordinance No. 3 of 1981 and Act No. 12 of 1981.
the 1979 Act was made to be operative but only from 1 10.1980 and not from 1.6.1979 a originally enacted.
6 After the Judgment of this Court in the Hansa Corporation ease , upholding the validity of the 1979 Act, the authorities appointed under the Act , issued notices under the Act (1) I.T.R. 1980 (1) Karnataka 165 665 to all the dealers including those who had filed writ petitions earlier , calling upon them to register themselves under the Act , to file returns and to pay the amounts of tax due by them under the original Act of 1979.
Aggrieved by the said notices , the original writ petitioners again filed writ petitions before the High Court of Karnataka contending that the notices issued to them were bad inasmuch as the writ of mandamus issued in their favour by the High Court in the earlier Judgment survived and Was effective since the State had not filed appeals against them , and that the Judgment of this Court could rescue the State from taking proceedings only against the Hansa Corporation and not against them.
The State met this contention with the plea that the Judgment of this Court was binding on all and no one could escape from it.
The writ petitions were heard by a learned Single Judge.
He dismissed them holding , among other things , that Section 3 of the Act No. 10 of 1981 revived the 1979 Act and that action taken against the petitioners in the writ petitions , was therefore , valid.
Appeals were filed against this Judgment.
A Division Bench of the Karnataka High Court dismissed the appeals holding that Section 3 of the repealing Act of 1981 re enacted the 1979 Act and that , therefore , the appellants were not well founded in their challenge against the action taken by the State.
The learned Single Judge and the Division Bench had to consider the effect of the two decisions of this Court for deciding the questions argued before them.
The decisions are the State of Punjab vs Joginder Sinnh(1) and Makhanlal Waza vs J & K ' State.(2) Strong reliance was placed by the petitioners on Joginder Singh , s case and equally strong reliance by the State on Makhanlal 's case.
The learned Single Judge and the Division Bench understood the principle enunciated in the two decisions differently.
They were under the impression that the action taken by the State would have been invalid , but for the saving provision contained in the repealing Act , notwithstanding the Judgment in Hansa Corporation ' case.
What falls for decision in these appeals is the resolution of the conflict between the approach made by the learned Single (l) ; (2) [l971] 3 S.C.R. 832.
666 Judge and the Division Bench to the two cases referred to above and to examine the ratio of the two decisions , since , in our opinion , these appeals can be disposed of on the short ground whether the Hansa Corporation Judgment validated the action taken by the State We will now briefly set out the facts of the two cases: In Juginder Singh 's case , four employees who were absorbed in Government service filed four separate writ petitions before the High Court of Punjab challenging certain executive powers and rules as being violative of Article 14 of the Constitution.
All the four petitions were allowed by the High Court by a common order by which the rules challenged were struck down.
The State of Punjab filed only one appeal before this Court against this common order and that against Joginder Singh.
At the hearing of the appeal , a preliminary objection was raised on his behalf that the appeal was incompetent since the State had not filed appeals against the three other petitioners and that, therefore , any variation by this Court of the Judgment in the appeal would result in inconsistent decisions in respect of the same matter.
In Makhanlal 's case , an order made by the Government of Jammu and Kashmir providing for reservation of posts for certain communities was challenged before this Court as violative of Article 16 of the Constitution.
This Court accepted the challenge and invalidated the promotions of respondents 3 to 83 in that case.
By its Judgment , this Court directed the State Government to devise a scheme consistent with the constitutional guarantee for reservation of appointment to posts and to pass appropriate orders.
The State Government instead of complying with the directions given by this Court , attempted to circumvent the same by continuing those whose promotions were invalidated , giving the posts a different name.
The same petitioners again moved this Court under Article 32 of the Constitution questioning the action of the State Government.
The State Government justified its action contending that there were many persons who were not parties to the earlier writ petitions and who had been promoted prior to and/or subsequent to this Court 's decision and that they were not bound by the earlier Judgment.
This contention was repelled by this Court.
It was held that the law declared by this Court was binding on the respondent State and its 667 Officers irrespective of the fact whether those who would be affected by its pronouncement were parties to the Judgment A or not.
Now we will see how the learned Single Judge and the Division Bench understood the two Judgments of this Court.
The learned Single Judge extracted the relevant portions from Joginder Singh 's case and observed that the said Judgment , according to him , settled two firm propositions which in his words are as follows: "(i) An appeal filed against only one person, though his writ petition was disposed of by common order along with other cases filed by others notwithstanding the fact that appeals arc not filed against some cases , would be competent: and (ii) an order made by the Supreme Court in such an a appeal would bind the parties to appeal and would not affect the validity of the order made in the other cases.
" He , then , distinguished that case from the case before him by R stating thus: "But that is not the position in these cases.
The precise question that arises for determination in these cases is whether an Act of Legislature struck down by the High Court on certain grounds is reversed by the Supreme Court and the Act declared to be constitutionally valid , thereafter a validation Act is also passed rendering the Judgment of the High Court in the other cases as ineffective , (sic).
On that , the enunciation made in Joginder Singh 's case does not bear on the point and assist the Petitioner. " , 11.
After considering the facts of the Makhan Lal 's case , the learned Single Judge observed thus "This later enunciation by a larger Bench however, without noticing the earlier decision in Joginder Singh 's 668 case , in unmistakable terms , has ruled that the declaration made by it or enunciation made by it , is binding on all authorities courts and persons whether they are parties or not.
Shri Srinivasan urged that the above enunciation in Makhanlal Waza 's case was made by the Supreme Court in the context of a binding order made against Government and not against those who were not parties to its earlier order and, therefore , the principles stated in that case has no principles stated in that case has no application to the question that arises for determination.
In my view the attempt made by Shri Srinivasan to distinguish the enunciation made in Makhanlal Waza 's case is without a d difference and has no merit at all.
The enunciation made is not based on any such distinction and difference.
On the application of the principles enunciated in Makhanlal Waza 'section case it follows that the declaration made by the Supreme Court in Messrs Hansa Carporation 's case upholding the validity of the Act is binding on all Courts, authorities and persons in the State of Karnataka notwithstanding the fact that the State had filed only one appeal and had not filed appeals in the other cases. " From the above discussion , it would appear that the learned Single Judge felt that Joginder Singh 's case indicated a different view.
Now we will see how the Division Bench understood the above propositions.
After considering the facts of the case and extracting the relevant portions of this Court`s Judgments , the Division Bench observed as follows: "In our opinion , there is no conflict between the aforesaid two decisions of the Supreme Court.
As rightly pointed out by Shri Srinivasan , in Makhanlal Waza 's case, the decision.
turned on the fact that the direction in the earlier Judgment of the 669 Supreme Court was made against the State Government and not against promotees who were not parties in the earlier writ petition.
The State Government which was a party in the earlier writ petition , was bound by the Judgment of the Supreme Court therein and could not disregard the direction of the Supreme Court on the ground that the promotees were not parties in the earlier writ petition.
Thus , the decision of the Supreme Court in Makhanlal Waza 's case is distinguishable on facts.
As the material facts of the present cases are similar to those in Joginder Singh 's case, the law laid down by the Supreme Court in that case , is squarely applicable to these cases.
" From the above conclusion , it appears that the Division Bench felt that the law laid down in Joginder Singh 's case applied to the appeals before it and that the decision of the Supreme Court in Makhanlal 's case was distinguishable on facts.
As indicated above , the appeals were dismissed relying upon 1 Section 3 of the repealing Act of 1981.
We will now consider the submissions made before us with reference to the above two decisions of this Court and examine the correctness of the findings entered by the learned Single Judge and the Division Bench.
The main thrust of the submission made by the learned counsel for appellants in these appeals is that the writ of mandamus issued by the High Court in their favour was effective since the Judgment in their favour was not challenged by filing appeals before this court.
It is submitted that the law laid down by this Court would apply only against the Hansa Corporation , against whom alone the State had filed an appeal In support of this contention the following passage at page 177 in Joginder Singh 's case was relied upon: "All the four petitions were delt with together and were disposed of by a common Judgment so that relief according to Joginder Singh , the respondent before us , in Writ application No. 1559 of 1960 was also granted to the other three petitioners.
The State , however , has preferred no appeal against the orders in the other three 670 petitions , and Mr. Agarwal , learned counsel for the respondent , raises the contention that as the orders in the other three petitions have become final , any order passed in this appeal at variance with the relief granted in the other three petitions would create inconsistent degree in respect of the same matter and so we should dismiss the present appeal as incompetent.
We , however , consider that this would not be the legal effect of any order passed by this Court in this appeal and that there is no merit in this objection as a bar to the hearing of the appeal.
In our opinion , the true position arising , if the present appeal by the State Government should succeed , would be that the finality of the orders passed in the other three writ petitions by the Punjab High Court would not be disturbed and that those three successful petitioners would be entitled to retain the advantages which they had secured by the decisions in their favour , not being challenged by an appeal being filed.
That however , would not help the present respondent , The respondent would be bound by our Judgment in this appeal and besides , so far as the general law is concerned as applicable to everyone other than the three writ petitioners (who would be entitled to the benefit of the decisions in their favour having attained finality), the law will be as laid down by this Court.
We , therefore, overrule the preliminary objection.
In our opinion , reliance on this passage by the appellants in support of their contention is not justified.
The only question that fell to be decided in Joginder Singh 's case was whether the appeal filed by the State was competent in the adsence of appeals against the other petitioners.
This was answered by the Court in the affirmative as follows: ".
We , however , consider that this would not be the legal effect of any order passed by the Court in this appeal and that there is no merit in this objection as a bar to the hearing of the appeal.
" It is this observation that disposes of the preliminary objec 671 tion and the finding of the Court on this objection is contained in the above passage.
The sentences that followed , relating to the effect of the orders passed by the High Court in the other three writ petitions can only be treated as obiter and therefore cannot be relied upon by the appellants to press a case that the law declared by this Court in Hansa Corporation 's case did not bind them.
The same principle is laid down in Makhanlal Waza 's case.
In that case , the State of Jammu and Kashmir attempted to circumvent the law declared by this Court in Trilok Nath and another vs State of Jammu Kashmir and others(1) by which the State policy of reservation to certain communities was declared bad by this Court with the plea that the vice of that Judgment operated only so far as the parties to the Judgment was concerned and not against those who were not parties thereto.
This Court repelled the contention and held as follows: ".
As regards the other respondent teachers who did not figure in the earlier petition , they were all promoted to the gazetted cadre prior and subsequent to the previous decision in complete defiance of the law laid down by this Court.
Such a course has been sought to be justified on the tenuous ground that they were not parties to the previous petition and therefore their cases would not be governed by the decision given in that petition.
It may be observed immediately that such a position is wholly untenable and misconceived.
The Judgment which was delivered did not merely declare the promotions granted to the respondents in the petition filed at the previous Stage as unconstitutional but also laid down in clear and unequivocal terms that the distribution of appointments , posts or promotions made in implementation of the communal policy was contrary to the constitutional guarantee of Articie 16.
The law so declared by this Court was binding on the respondent State and its officers and they were bound to follow it whether a majority of the present respondents were parties or not to the previous petition.
In our opinion , both these decisions lay down identical (1) [1969] I S.C.R. 103.
672 principles and there is nothing to distinguish between the two.
In the earlier case , this Court , on its facts , overruled the preliminary objection that absence of appeals against the three petitioners left out , would not render the appeal before this Court incompetent , holding thereby that the effect of the decision in that appeal would be binding on the appellant therein.
In the latter case , this Court in unmistakable terms laid down that the law laid down in the earlier case , namely , Triloknath 's case , applied even to those who were not parties to the case.
These two decision were given by two Constitution Benches of this Court.
We find that Joginder Singh 's case was not noted by the Bench that decided Makhanlal Waza 's case.
This does not create any difficulty.
As we have already held , the two decisions , on the principles laid down by them , speak the same voice , i.e. that the law laid down by the Supreme Court is binding on all , notwithstanding the fact that it is against the State or a private party and that it is binding on even those who were not parties before the Court.
Since it is necessary to make the position of law clear and free from ambiguity , we would set out our reasons for our conclusion clearly.
Though a large number of writ petitions were filed challenging the Act , all those writ petitions were grouped together , heard together and were disposed of by the High Court by a common Judgment.
No petitioner advanced any contention peculiar or individual to his petition , not common to others.
To be precise , the dispute in the cause or controversy between the State and each petitioner had no personal or individual element in it or anything personal on peculiar to each petitioner.
The challenge to the constitutional validity of 1979 Act proceeded on identical grounds common to all petitioners.
This challenge was accepted by the High Court by a common Judgment and it was this common Judgment that was the subject matter of appeal before this Court in Hansa Corporation 's case.
When the Supreme Court repelled the challenge and held the Act constitutionally valid , it in terms disposed of not the appeal in Hansa Corporation 's case alone , but all petitions in which the High Court issued mandamus on the none existent ground that the 1979 Act was constitutionally invalid.
It is , therefore , idle to contend that the law laid down by this Court in that Judgment would bind only the Hansa Corporation and not the other petitioners against whom the State of Karnataka had not filed any appeal.
To do so is to ignore the binding nature of a Judgment of this Court under Article 141 of the Constitution.
673 Article 141 reads as follows: A "The law declared by the Supreme Court shall be binding on all courts within the territory of India " A mere reading of this Article brings into sharp focus its expanse and its all pervasive nature.
In cases like this , where numerous petitions are disposed of by a common Judgment and only one appeal is filed , the parties to the common Judgment could very well have and should have intervened and could have requested the Court to hear them also.
They cannot be heard to say that the decision was taken by this Court behind their back or profess a ignorance of the fact that an appeal had been filed by the State against the common Judgment.
We would like to observe that , in the fitness of things , it would be desirable that the State Government also took out publication in such cases to alert parties bound by the Judgment , of the fact that an appeal had been preferred before this Court by them.
We do not find fault with the State for having filed only one appeal.
It is , of course , an economizing procedure.
The Judgment in the Hansa Corporation case rendered by one of us (Desai , J.) concludes as follows "As we are not able to uphold l the contentions which found favour with the High Court in striking down the impugned Act and the notification issued thereunder and as we find no merit in other contentions canvassed on behalf of the respondent for sustaining the Judgment of the High Court , this appeal must succeed.
Accordingly , this appeal is allowed and the Judgment of the High Court is quashed and set aside and the petition filed by the respondent in the High Court is dismissed with costs throughout.
" To contend that this conclusion applies only to the party before this Court is to destroy the efficacy and integrity of the Judgment and to make the mandate of Article 141 illusory.
By setting aside the common Judgment of the High Court , the mandamus issued by the High Court is rendered ineffective not only in one case but in all cases.
674 19.A writ or an order in the nature of mandamus has always been understood to mean a command issuing from the Court , competent to do the same , to a public servant amongst others , to perform a duty attaching to the office , failure to perform which leads to the initiation of action.
In this case , the petitioners appellants assert that the mandamus in their case was issued by the High Court commanding the authority to desist or forbear from enforcing the provisions of an Act which was not validly enacted.
In other words , a writ of mandamus was predicated upon the view that the High Court took that the 1979 Act was constitutionally invalid.
Consequently the court directed the authorities under the said Act to forbear from enforcing the provisions of the Act qua the petitioners.
The Act was subsequently declared constitutionally valid by this Court.
The Act , therefore , was under an eclipse , for a short duration; but with the declaration of the law by this Court , the temporary shadow cast on it by the mandamus disappeared and the Act revived with its full figure , the constitutional invalidity held by the High Court having been removed by the Judgment of this Court.
If the law so declared invalid is held constitutionally valid , effective and binding by the Supreme Court , the mandamus for bearing the authorities from enforcing its provisions would become ineffective and the authorities cannot be compelled to perform a negative duty.
The declaration of the law is binding on everyone and it is therefore , futile to contend that the mandamus would survive in favour of those parties against whom appeals were not filed.
The fallacy of the argument can be better illustrated by looking at the submissions made from a slightly different angle.
Assume for arguments sake that the mandamus in favour of the appellants survived notwithstanding the Judgment of this Court.
How do they enforce the mandamus ? The normal procedure is to move the Court in contempt when the parties against whom man damus is issued disrespect it.
Supposing contempt petitions are filed and notices are issued to the State.
The State 's answer to the Court will be: "Can I be punished for disrespecting the mandamus , when the law of the land has been laid down by the Supreme Court against the mandamus issued , which law is equally binding on me and on you ?".
Which Court can punish a party for contempt under these circumstances ? The answer can be only in the negative because the mandamus issued by the High Court becomes ineffective 675 and unenforceable when the basis on which it was issued falls , by the declaration by the Supreme Court , of the validity of 1979 Act.
In view of this conclusion of ours , we do not think it necessary to refer to the other arguments raised before the High Court and which the learned counsel for the appellants attempted to raise before us also.
The appeals can be disposed of on this short point stated above.
The Judgment of this Court in the Hansa Corporation 's case is binding on all concerned whether they were parties to the Judgment or not.
We would like to make it clear that there is no inconsistency in the finding of this Court in Joginder Singh 's case and Makhanlal Waza 's case.
The ratio is the same and the appellants cannot take advantage of certain observations made by this Court in Joginder Singh 's case for the reasons indicated above.
In the writ petitions the challenge is against Section 7 of Act No. 10 of 1981 and they contain certain other prayers also.
We do not think it necessary to deal with the contentions raised in them since it would be an unnecessary exercise , in view of the revival of the parent Act of 1979 by the Judgment of this Court.
In the result , the appeals and the writ petitions are dismissed with costs; cost quantified at Rs. 2,000 in each case.
S.R. Appeals & Petitions dismissed.

summary:
That Constitutional validity of the Karnataka Tax on Entry of Goods into Local Areas for consumption , use or sale therein Act , 1979 , which came into force with effect from 1 6.1979 was challenged in the Karnataka High Court by a large number of traders though a batch of 1590 writ petitions including writ petition No. 7039/79 by M/s. Hansa corporation Bangalore.
A Division Bench of the Court, by a common judgment dated 24.8.79 reported in ILR 1980 (1) Karnataka 165 allowed all the writ petitions and issued writs of mandamus against the State Government forbearing it from taking any proceedings under the Act.
The State took the matter in appeal in this Court.
However , only one appeal was filed , numbered as 3049 of 1979 against writ petition No. 170 39 of 1979 filed by M/s Hansa Corporation , impleading this Corporation alone as respondent.
This Court by its judgment dated 25.9.80 which is reported in ; , allowed the appeal , set aside the judgment of the Karnataka High Court and upheld the validity of the Act.
During the pendency of the civil appeal No 3049 of 1979 Governor of Karnataka enacted the Karnataka Tax on Entry of Goods into a Local Area 660 for Consumption , use or sale therein (Act with retrospective effect from 8.6.80 removing the infirmities in the 1979 Act.
After the judgment of the Supreme Court in the Hansa Corporation 's case the Governor of Karnataka promulgated another ordinance , Ordinance No. 11 of 1980 on 25.10.1980 repealing the Entry Tax Act , 1980 from its inception with certain other directions regarding adjustment of tax if any paid.
This was followed by Karnataka Tax on Entry of Goods into Local Areas , Use or Sale therein Act , of 1981 , and Karnataka Act No. 10 of 1981 , repealing the 1980 Act.
however , did not repeal ordinance No. 11 of 1980.
In the meantime , Karnataka Ordinance No. 3 of 1981 came into force which was followed by Karnataka Act 12 of 1981 I which repealed Ordnance No. II of 1980.
As a result of the combined operation of ordinance No. 3 of 1981 and Act No 12 of 1981 , the 1979 Act was made to be Operative but only from 1.10.80 and not from 1.6.79 as originally enacted After the judgment of the Hansa Corporation 's case upholding the validity of the 1979 Act , the authorities appointed under the Act , issued notices under the Act to all the dealers including those who had filed writ petition earlier , calling upon them to register themselves under the Act , to file returns and to pay the amounts of tax due by them under the original Act of 1979.
Aggrieved by the said notices , the original writ petitioners again filed writ petitions before the High Court of Karnataka contending that the notices issued to them were bad in as much as the writ of mandamus issued in their favour by the High Court in the earlier judgment survived and was effective since no state appeals were performed against them and that the judgment of the Supreme Court could rescue the State from taking proceedings only against the Hansa Corporation and not against them.
The Statement this contention with the plea that the judgment of the Supreme Court was binding on all and no one could escape from it.
The writ petitions were dismissed by a single judge holding among other things , that section 3 of the Act No 10 of 1981 revived the 1979 Act and that action taken against the petitioners in the writ petitions was , therefore , valid.
Appeals were filed against the judgment and a Division Bench of the Karnataka High Court dismissed the appellants holding that section 3 of the re pealing Act of 1981 re enacted the 1979 Act and that , therefore , the appeals were not well founded i 1 their challenge against the action taken by the State.
Hence the appeals by special leave and also writ petitions under Article 32 of the Constitution.
Dismissing the appeals and the writ petition , the Court ^ HELD: 1.1 The judgment of the Supreme Court in Hansa Corporations ' case reported in ; is binding on all concerned whether they were parties to the judgment or not To contend that the conclusion therein applies only to the partly before the Supreme Court is to destroy the efficacy and integrity of the judgment and to make the mandate of Article 141 illusory.
By setting aside the common judgment of the High Court , the mandamus issued by the High Court is rendered ineffective not only in one case but in all cases.[675; 673 H] 1.2 In the instant case , though a large number of writ petitions were filed challenging the Act , all those writ petitions were grouped together , heard 661 together and were disposed of by the High Court by a common judgment.
No petitioner advanced any contention peculiar or individual to his petition , not common to others.
To be precise , the dispute in the cause or controversy between the State and each petitioner had no personal or individual element in it or anything personal or peculiar to each petitioner.
The challenge to the Constitutional validity of 1979 Act proceeded on identical grounds common to all petitioners.
This challenge was accepted by the High Court by a common judgment that was the subject matter of appeal before Supreme Court in Hansa Corporations ' case.
When the Supreme Court repealed the challenge and held the Act constitutionally valid it in terms disposed of not the appeal in Hansa Corporation 's case alone , but all petitioners in which the High Court issued mandamus on the non existent ground that the 1979 Act was constitutionally invalid.
Therefore , to contend that the law laid down by Supreme Court in that judgment would bind only the Hansa Corporation and not the other petitioners against whom the State of Karnataka had not filed any appeal , is to ignore the binding nature of a judgment of Supreme Court under Article 141 of the Constitution.
[673B C) 1.3 A mere reading of Article 141 bring into sharp focus its expanse and its all pervasive nature.
In cases like this , where numerous petitions are disposed of by a common judgment and only one appeal is filed , the parties to the common judgment could very well have and should have intervened and could have requested the court to hear them also.
They cannot be heard to say that the decision was taken by the Supreme Court behind their back or profess ignorance of the fact that an appeal had been filed by the State against the common judgment.[673B C] 2.
There is no inconsistency in the finding of the Supreme Court in Joginder 's case and Makhanlal Waza 's case the ratio Is the same and the appellants cannot take advantage of certain decisions made by this Court in the earlier case.
Both the decisions in Joginder 's and Makhanlal Waza 's case lay down identical principles and there is nothing to distinguish between the two.
in the earlier case, the Supreme Court , on its facts , overruled the preliminary objection that absence of appeals against the three petitioners let out.
would not render the appeal before the Supreme Court incompetent , holding thereby that the effect of decision in that appeal would be binding on the appellant therein.
In the latter case , the Supreme Court in unmistakable terms laid down that the law laid down in the earlier case , namely , Triloknath 's case, applied even to those who were not parties to the case.
These two decisions were given by two Constitution Benches of the Supreme Court , the fact that Joginder Singh 's case was not noted by the Bench that decided Makhanlal Waza 's case does not create any difficulty.
The two decisions , on the principles laid down by them , speak the same voice, that is the law laid down by the Supreme Court is binding on all , notwithstanding the fact that it is against the State or a private party and that it is binding on even those who were not parties before the court , State of Punjab vs Joginder Singh. ; Makhanlal Waza vs J & K. State. ; discussed and followed.
662 OBSERVATION: In the fitness of things , it would be desirable that the State Government also took out publication in such cases to alert parties bound by the judgment , of the fact that an appeal had been preferred before Supreme Court by them.
Here the State Government cannot be find fault with for having filed only one appeal.
It is , of course , an economising procedure.
[673C D] 3.1 A writ or an order in the nature of mandamus has always been understood to mean a command issuing from the Court , competent to do the same , to a Public servant amongst others , to perform which leads to the initiation of action.
3.2 In this case , the petitioners appellants assert that the mandamus in their case was issued by the High Court commanding the authority to desist or forbear from enforcing the provisions of an Act which was not validity enacted.
In other words , a writ of mandamus was predicated upon the view that the High Court took that the 1979 Act was constitutionally invalid.
Consequently the Court directed the authorities under the said Act to forbear from enforcing the provisions of the Act qua the petitioners; The Act was subsequently declared constitutionally valid by the Supreme Court.
The Act , therefore , was under an eclipse , for a short duration; but with the declaration of the law by the Supreme Court , the temporary shadow cast on it by the mandamus disappeared and the Act revived with its full the constitutional invalidity held by the High Court having been removed by the judgment of the Supreme Court.
If the law so declared invalid is held constitutionally valid , effective and binding by the Supreme Court , the mandamus forbearing the authorities from enforcing its provisions would become ineffective and the authorities cannot be compelled to perform a negative duty.
The declaration of the law is binding on everyone.
And therefore , the mandamus would not survive in favour of those parties against whom appeals were not filed.
[774B E] 3.3 Further , assuming that the mandamus in favour of the appellants survived not withstanding the judgment of this Court , the normal procedure to enforce the mandamus is to move the court in contempt when the parties against whom mandamus is issued disrespect it and if contempt petitions are filed and notices are issued to the State, the States ' obvious answer will be a reference to Article 141 and taking protection thereunder.
No Court can punish a party for contempt under these circumstances , because the mandamus issued by the High Court becomes ineffective and unenforceable when the basis on which it has issued falls, by the declaration by the Supreme Court of the validity of 1979 Act.
[674E; G H]