judgement:
Appeal No. 214 of 1962.
Appeal from the judgment dated July 8, 1960 of the Kerala High Court, Emakulam, in Income tax Referred Case No. 10 of 1957.
section T. Desai and Sardar Bahadur, for the appellant.
K. N. Rajagopal Sastry, R. N. Sahthey and P. D. Menon, for the respondent.
October 25.
The judgment of the Court was delivered by HIDAYATULLAH, J.
The assessee, A.V. Thomas & Co., Ltd., Alleppey, claimed a deduction of Rs. 4,05,072 8 6 in the assessment year 1952 53 as a bad debt which was written off in its books of account on December 31, 1951.
This claim was disallowed.
After sundry procedure, the following question was considered by the High Court of Kerala and answered against the assessee company : "Whether on the facts and the circumstances of the case, the Tribunal was correct in holding 778 that the amount of Rs. 4,05,071 8 6 claimed by the assessee Co. as a deduction was not admis sible either under section 10(2) (xi) or 10(2) (xv) ?" The High Court certified the case as fit for appeal to this Court and this appeal has been filed by the assessee company.
The Commissioner of Income tax (Bangalore) Kerala, is the respondent.
The assessee company was incorporated in 1935 and, as is usual with companies, its Memorandum of Association, authorised it to do multifarious businesses.
According to clauses 1, 5, 18 and 23, it was authorised "to be interested in, to promote, and to undertake the formation and establishment of other companies", to make investments and to assist any company financially or otherwise.
At the material time the assessee company had three directors, whose names are given below 1.
A. V. Thomas 2. section Sankaranarayana lyer and 3.
J. Thomas.
There was another private limited company known as the Southern Agencies Limited, Pondicherry, and its directors were : 1.
A. V. Thomas 2.
section section Natarajan, and 3.
C, section Ramakrishna Karayalar.
There was a mill in Pondicherry known as Rodier Textile Mill belonging to the Anglo French Textiles Limited, Pondicherry.
The assessee company averred that the Southern Agencies Ltd., took up in 1948 the promotion of a limited company to be known as Rodier Textile Mills Ltd., Pondicherry, with 779 a view to buying and developing the Rodier Textile Mill.
The assessee company, so it was stated, financed the Southern Agencies Ltd., Pondicherry, by making over funds aggregating to the sum of Rs. 6,05,071 8 6.
This amount was not given directly by the assessee company but at its instance by India Coffee and Tea Distributors Ltd., Madras.
The assessee company further stated that though an entry in its own books dated December 31, 1948, showed this amount as an advance for purchase of 6,000 shares of Rs. 100 each in the Rodier Textile Mills Ltd., the main intention of the assessee company was to assist and finance the Southern Agencies Ltd. within the terms of the assessee company 's Memorandum.
The subscription list for the Rodier Textile Mills Ltd. remained open from January 5 to January 20, 1949.
No application for shares was made on behalf of the assessee company and the shares were not acquired.
The public took no interest in the new company which was being promoted and the whole project tailed.
On September 1, 1950, the assessee company approved of the action of Mr. A. V. Thomas in making the said advance and on September 18, 1950, a resolution was passed by the Board of Directors of The assessee company that the amount of Rs. 6,00,000 should be shown as an advance for purchase of shares in the Rodier Textile Mills Ltd. (in formation) and the balance of Rs. 5,072 8 5 be shown under sundry advances due from the promoters of the new company.
The Southern Agencies Ltd. however, did not return the ' entire amount.
On December 7, 1951, it paid back Rs. 2,00,000 which appears to have been received in full satisfaction.
Though as late as June 12, 1951, the advance was considered to be good and recoverable, the balance was written off on December 31, 1951, which was the close of the year of account of the assessee company.
It was this amount which was claimed in the assessment year 1952 53 as a bad 780 debt actually written off, or alternatively as an expenditure, not of a capital nature, laid out or expended wholly and exclusively for the purpose of the assessee company 's business.
The Income tax Officer, Alleppey, held that the debt was written off at a time when it was neither bad nor doubtful and the claim to write it off was premature.
He, therefore, disallowed it.
An appeal was taken to the Appellate Assistant Commissioner and he upheld the order of the Income tax Officer though on a different ground.
He held that the advance was made for the purpose of purchasing shares of the new company then in formation and it was thus made for the acquisition of a capital asset, which was either the control of the new company or ""to gain its good will likely to result in the grant of agency rights" to the assessee company.
According to the Commissioner, the loss, if any, was of a capital nature and the question whether the claim of bad debt was premature or otherwise did not arise for consideration.
The Appellate Assistant Commissioner also held that the deduction could not be claimed as an allowance under section 10(2)(xv) of the Income tax Act.
The assessee company appealed to the Tribunal.
The Tribunal upheld the order of the Appellate Assistant Commissioner but on a third ground.
The Tribunal accepted that one of the objects of the assessee company was the promotion and financing of other companies for gain but this advance of Rs. 6,00,000 was not made by the assessee company in the normal course of its business.
It was rather a transaction "actuated only by personal motives".
In reaching this conclusion the Tribunal observed that the advance was made to Southern Agencies Ltd. which was not a company promoted by the assessee company, that between these two companies there was no previous business connection and at the assessee company had no expectancy of a financial benefit.
The Tribunal held that the 781 Rodier Textile Mills Ltd.,, Pondicherry, was not being financed or promoted by the assessee company and that the statement by the assessee company that it would have received some agency right was not supported by evidence.
The Tribunal was of the opinion that this advance was probably due to the " substantially common ownership of the assessee company and the Southern Agencies Ltd., of two individuals, namely, A. V. Thomas and section section Natarajan." The Tribunal thus held that this deduction could not be claimed as it was given out of " 'personal motives" and not as a part of the business of the assessee company.
The assessee company demanded a case but it was refused by the Tribunal.
The assessee company in its application for the case had propounded three questions as under : "(i) Whether on the facts and in the circums tances of the case, the sum of Rs. 4,05,072 8 5 can be claimed by the assessee as a bad debt written off under the provisions of Section 10(2) (xi) of the Act, (ii) Whether on the facts and in the circums tances of the case, the assessee can claim the sum of Rs. 4 '.05,072 8 5 as permissible deduction under Section 10(2) (xv) of the Act, and (iii) Whether co the facts and in the circums tances of the case, the assessee is permitted to claim the deduction of the said sum of Rs. 4,05,072 8 5 as a proper debit and charge it to the Profit and Loss account of the assessee company.
" These questions show that the deduction was claimed (i) as a loss in the doing of the business under 782 section 10(1); (ii) as a bad debt actually written off under section 10(2)(xi); and (iii) as an expenditure laid out wholly and exclusively for the purpose of the business under section 10(2)(xv) of the Income tax Act.
The assessee company applied to the High Court and the High Court directed a reference on the single question which has been quoted.
That question shows that the High Court did not direct the case under section 10(1) of the Act.
The Tribunal had considered the case from the point of view of the business and had held that this was not an advance in the normal course of business but one out of ""personal motives".
The High Court apparently had not accepted that the matter could be considered under section 10(1) and framed the question under cls.
(xi) and (xv) of section 10(2).
The question as propounded and considered by the High Court related to the two clauses only.
An attempt was made before us to raise the issue under section 10(1) and to claim the deduction as an ordinary business loss.
We disallowed the argument because in our opinion the question as considered in the High Court does not embrace it.
The assessee company should have requested the High Court at some stage to frame a question that there was no material for the Tribunal to reach the conclusion that this was not a business transaction but a case of an advance out of personal motives.
It was contended before us that the High Court in calling for a reference on the single question had stated that that question would cover three matters.
The first two 'here mentioned in the question and the third which was said to be implicit was whether the Tribunal was competent to decide a case which had not been made out by the Department at an earlier stage.
But this was not the same thing as saying that the Tribunal had no material before it on which it could reach the conclusion that this was not an advance in the ordinary course of business by the assessee company.
No doubt, the High Court in its order calling for a statement of the case has observed that there was no dispute at any 783 earlier stage that this was not in the ordinary course of business, but that conclusion of the High Court in the order it made under section 66(2) can have no relevance or binding force.
Indeed, the High Court was in error in giving a finding of its own and it is not surprising that the Tribunal protested against this finding.
It was open to the High Court to frame a question whether there was any material to support the finding of the Tribunal and to ask the Tribunal to state a case thereon.
Not having done so, the question as framed drives the assessee company to prove its case either under section 10(2)(xi) or under section 10(2)(xv) and it is from these two angles that the case will be considered by us.
Clauses (xi) and (xv) of section 10(2) read as follows : "(2) Such profits or gains shall be computed after making the following allowances, namely x x x a (xi) when the assessee 's accounts in respect of any part of his business, profession or vocation are not kept on the cash basis, such sum, in respect of bad and doubtful debts, due to the assessee in respect of that part of his business, profession or vocation, and in the case of an assessee carrying on a banking or money lending business, such sum in respect of loans made in the ordinary course of such business as the Income tax Officer may estimate to be irrecoverable but not exceeding the amount actually written off as irrecoverable in the books of the assessee : (Proviso omitted) (xv) any expenditure (not being an allowance of the nature described in any of the clauses (i) to (xiv) inclusive, and not being in the nature of capital expenditure or 784 personal expenses) laid out or expended wholly and exclusively for the purpose of such business, profession or vocations".
In support of its case, the assessee company stated that as there was no dispute about the facts that this was an advance in the ordinary course of business it should be treated as a trading loss or alternatively as a bad debt or an expenditure claimable under section 10(2)(xv).
The assesses company relied strongly upon certain Ledger entries of the Rodier Textile Mills Ltd. in the books of the assessee company.
These have been marked as Annexures A. 1 to A. 3.
The High Court also referred to these accounts and they have been construed as showing, that there was an attempt by the assessee company to acquire a capital asset.
These accounts began in 1948 and ended on December 31, 1951.
The accounts are headed "Personal Ledger.
" In December, 1948, sundry amounts totalling Rs. 6,05,071 8 5 are shown as amounts "paid to you by Indian Coffee and Tea Distributors Ltd., Madras, towards purchase of shares.
" On January 1, 1949, the account opened with a debit balance of Rs. 6,05,071 8 5.
Nothing appears from the accounts who this " 'you" was.
A number of reversing entries were made in respect of certain amounts and then on December 31, 1949, the amount was shown as follows : By advance for sundry expenses due from the promoters of new company debited to this trans ferred 5,071 8 5 By balance 6,00,000 0 0 1950 opened with entry on January I To Balance 6,00,000 0 0 and closed with an entry By Amount paid to Southern Agencies Ltd, 6,00,000 0 0 785 This was shown as an opening balance on January 1, 1951.
On December 7, a payment of Rs. 2,00,000 was shown and Rs. 4,00,000 were transferred for writing off.
On December 31., 1951, Rs. 4,00,000 were written off and so also the amount of Rs. 5,072 8 5.
The last amount included a sum of Rupee 1, hire for carriage which was also written off after the entry had been reversed.
From these accounts it is quite clear that to begin with the amount was shown as an advance for purchase of shares of the Rodier Textile Mills Ltd. If this was the purpose, it was not an expenditure on the revenue side.
The High Court correctly pointed out that it was not the business of the assessee company to buy agencies and sell them.
The shares were being acquired by the assessee company so that it might have the lucrative business of selling agency and similar other agencies from the Rodier Textile Mills Limited.
As late as December 15, 1952, the Chairman of the assessee company stated in his speech as follows : "You are aware that an advance was made to the Southern Agencies (Pondicherry) Ltd. to acquire for us shares in Rodier Textile Mills Ltd. It was felt that when the promotion and working of Rodier Textile Mills Ltd., became a fait ac compli, our company stood considerably to gain by securing their agency for handling their goods.
" This clearly shows that the assessee company intended to acquire a capital asset for itself This purpose takes the case of the assessee company out of section 10(2)(xv) of the Income tax Act, because no expenditure can be claimed under that clause which 'is of a capital nature.
By the declaration of the Chairman of the assessee company the case under section 10(2)(xv) becomes completely untenable.
In any event, the 786 amount was not expended in the year of account ending with December 31, 1951 : it was expended in 1948.
It remains to consider the case under section 10(2)(xi).
In this connection, we were referred to the Memorandum of Association to show that it was one of the objects of the assessee company to promote other companies and this amount was paid to Southern Agencies Ltd. to promote the Rodier Textile Mills Ltd. There is no doubt that the objects mentioned in the Memorandum of Association of the assessee company include the promotion and financing of other companies.
A Memorandum, however, is not conclusive as to the real nature of a transaction.
That nature has to be deduced not from the Memorandum but from the circumstances in which the transaction took place.
Here, the different versions given in the books of account of the assessee company belie the assertion that this was an amount paid to promote the Rodier Textile Mills Ltd.
Even though this money was available on December 31, 194 8, and the subscription list for the shares remained open from January 5 to 20, 1949, no application for a single share was made on behalf of the assessee company.
The entry till the end of 1949 was that the amount was laid out for purchase of shares.
It was only subsequently that it was shown to be an advance to the Southern Agencies Ltd. In fact, the entry comes only at the end of 1950 when it is set down "By Amount paid to Southern Agencies Ltd." The assessee company raised three contentions in support of the case that this became a bad and doubtful debt which was actually written off : (a.) that the High Court was wrong in saying that before the assessee could claim the deduction under section 10(2)(xi) it must prove that it had in the past purchased and sold agencies, (b) that the object of the assessee company was to apply for shares but as it did not 787 apply for shares the transaction between it and the Southern Agencies remained an advance in the ordinary course of business, and (c) Southern Agencies having failed to give back the money the assessee company was within its rights to write off this bad and doubtful debt.
Now, a question under section 10(2)(xi) can only arise if there is a bad or doubtful debt.
Before a debt can become bad or doubtful it must first be a debt.
What is meant by debt in this connection was laid down by Rowlatt, J., in Curtis v.1.
& G. Oldfield Ltd.,(1) at p. 330 as follows : "When the Rule speaks of a bad debt it means a debt which is a debt that would have come into the balance sheet as a trading debt 'in the trade that is in question and that it is bad.
It does not really mean any debt which, when it was a good debt, would not have come in to swell the profits.
" A debt in such cases is an outstanding which if recovered would have swelled the profits.
It is not money handed over to someone for purchasing a thing which that person has failed to return even though no purchase was made.
In the section a debt means something more than a mere advance.
It means something which is related to business or results from it.
To be claimable as a bad or doubtful debt it must first be shown as a proper debt.
The observations of Rowlatt, J., were applied by the Privy Council in Arunachalam Chettiar vs Commissioner of income tax(2), at p. 245, where their Lordships observed as follows: "Their Lordships moreover can give no countenance to a suggestion that upon a dissolution of partnership a partner 's share of the losses for several preceding years can be accumulated and thrown into the scale against (1) , 330.
(2) (1936) L. R. 63 I. A. 233, 245 788 the income of another partner for a particular year.
No principle of writing off a bad debt could justify such a course, whether in the year following the dissolution or., as logic would permit, in some subsequent year in which the partner 's insolvency has crystallised.
The ; 'bad debt" would not, if good, have come in to swell the taxable profits of the other partner.
" This Court also approved the dictum of Rowlatt, J., in COMMissioner of Income tax vs Abdullabhai Abdulkadar (1) at p. 550 and referred to the observations of Venkatarama Ayyar, J., in Badridas Daga, vs Commissioner of Income, tax, (2) where the learned judge speaking for this Court said that a business debt "springs directly from the carrying on of the business and is incidental to it and not any loss sustained by the assessee, even if it has some connection with his business." Section 10(2)(xi) is in two parts.
One part deals with an assessee who carries on the business of a banker or money lender.
Another part deals with business other than the aforesaid.
Since this was not a loan by a banker or money lender, the debt to be a debt proper had to be one which if good would have swelled the taxable profits.
Applying these tests, it is quite obvious that an advance paid by the assessee company to another to purchase the shares cannot be said to be incidental to the trading activities of the assessee company.
It was more in the nature of a price paid in advance for the shares which the Southern Agencies had a right to allot in the Rodier Textile Mills Ltd. This cannot, therefore, be described as a debt and indeed the changes in the books of account of the assessee company clearly show that the assessee company itself was altering the entries to convert the advance into a debt so as to be able to write it off and claim (1) ; , 954.
(2) ; 789 the benefit of section 10 (2) (xi).
In our opinion, section 10(2)(xi) was inapplicable to the facts of this case.
In the result the appeal must fail and it is dismissed.
The assessee company shall pay the costs of the respondent.
Appeal dismissed.

summary/full:
The assessee company was incorporated in 1935 and its Memorandum of association authorised it, inter alia, to promote and to undertake the formation and establishment of other companies and to assist any company financially or otherwise.
There was another company known as the Southern Agencies Ltd. and Mr. A. V. Thomas was director of both these companies.
In 1948 the Southern Agencies Ltd. began the promotion of a company to be known as the Rodier Textile Mills Ltd., with a view to buying up a Mill known as the Rodier Textile Mills.
The assessee company made an advance of Rs. 6 lakhs odd to the promoter for the purchase of 6000 shares of the new company.
The public took no interest in the new company and the whole project failed.
No application for shares was made on behalf of the assesee company and no share was acquired.
The Southern Agencies Ltd., however, did not return the entire amount.
On December 7, 1951, it paid back only Rs. 2 lakhs which was received in full satisfaction.
The balance of Rs. 4,05,071 8 6 was written off on December 31, 195 1, which was the close of the year of account of the assessee company.
For the assessment year 1952 33 the assessee company claimed a deduction of that amount as a bad debt actually written off, or alternatively as an Expenditure, not of a capital nature laid out or expended wholly and exclusively for the purpose of its business.
777 Held, (1) that the amount advanced for the purchase of shares was of a capital nature and, therefore, the balance was not allowable as an expenditure under s 10 (2) (xv) of the Indian Income tax Act, 1922, as it was not the business of the assessee company to buy agencies and sell them; and in any event the amount was expended in 1948 and not in the year of account ending December 31, 1951.
(2) that it was not a bad debt under section 10 (2) (xi).
A debt in such cases is an outstanding which is recovered would have swelled the profits.
It is not money handed over to some one for purchasing a thing which that person has failed to return even though no purchase was made.
Curtis vs J. & G. Old field Ltd., , Arunachalam Chettiar vs Commissioner 'of Income tax, (1936) L. R. 63 I. A. 233, Badridas Daga vs Commissioner of Income tax; , and Commissioner of Income tax vs Abdullabhi Abdulakadar; , , relied on.


judgement:
ions Nos. 130 & 133 of 1962.
Under Article 32 of the Constitution of India for the enforcement of Fundamental Rights.
section K. Venkatarangaiengar and R. Gopalakrishnan, for the Petitioners (In both the Petitions).
P. D. Menon, for the Respondents (In both the Petitions).
November 5.
The judgment of the Court, was delivered by GAJENDRAGADKAR,J. These two writ petitions Nos.130 of 1962 and 133 of 1962 have been filed by Heggade.
Janardhan Subbarye and Ravindra Prabhu respectively (hereinafter called the petitioners) under article 32 of the Constitution, challenging the validity of the orders issued by respondent No. 1, the State of ' Mysore, under article 15(4) of the Constitution on July 10, 1961 and July 31, 1962, respectively.
Both the petitioners had applied for admission to the pre Professional Class in Medicine in the Karnatak Medical College, Hubli, and the applications had been submitted to respondent No. 2, the Selection Committee appointed in that behalf by respondent No. 1.
According to the petitioners, they would have secured admission to the said Medical College but for the reservation directed to be made by the two impugned orders.
They alleged that the orders were ultra vires, and so, they prayed for an appropriate writ or order restraining the respondents from giving effect to the said orders and requiring, them to deal.
with the petitioners ' 'applications on the merits.
477 The points raised by the present petitions are covered by the decision of this Court in the case of M.R. Balaji vs State of Mysore(1) and so, it is common ground that the petitioners are entitled to an appropriate writ or order as claimed by them.
Learned counsel for the respondents however, drew our attention to the fact that as a result of the decision of this Court in the case of M. R. Balaji (1) respondent No. 1 was feeling some doubt as to whether the reservation made by the impugned orders in respect of the Scheduled Castes and the Scheduled Tribes was also struck down by this Court.
As the judgment shows, respondent No. 1 has consistently fixed the percentage of reservation in respect of the Scheduled Castes and the Scheduled Tribes at 15% and 3% respectively.
Five orders have been passed by respondent No. 1 one after the other under article 15(4), but the reservation fixed for the Scheduled Castes and the Scheduled Tribes has always remained the same.
It is true that the judgment of this Court does not expressly say that the validity of the said reservation was not assailed before this Court and cannot, therefore, be deemed to have been affected by the decision.
However, as the judgment shows, the only attack against the validity of the impugned orders was directed against the additional reservation made in favour of the socially and educationally Backward Classes of citizens in the State.
The petitions filed in the said cases were confined to the said reservation and during the course of the arguments before this Court, it was not suggested by the petitioners ' learned counsel that the reservation made in favour of the Scheduled Castes and Tribes was in any manner irregular or not justified by article 15(4).
This position is not disputed by the petitioners ' learned counsel before us.
Therefore, we think that in order to avoid any doubt in the matter it is necessary to make it clear that our judgment in that case does not affect the (1) (1963) supp.
1 section C. R. 439.
478 validity of the said reservation which is distinct and separate from, and independent of, the other reservation which was challenged.
The said reservation continues to be operative and the fact that the impugned orders have been quashed does not alter that position.
The said orders have been quashed solely by reference to the additional reservation made by the impugned orders in regard to the socially and educationally Backward Classes, and so, respondent No. 1 would be justified in giving effect to the reservation made in respect of the Scheduled Castes and Scheduled Tribes.
In the result, we allowed the petitions and direct that an appropriate writ or order should be issued ' restraining the respondents from giving effect to the two impugned orders.
In the circumstances of these cases, we direct that the petitioners should get from the respondents costs incurred by them, except the hearing fee.
Petitions allowed.

dataset_name: IN-Abs

summary/full:
The petitioners challenged the validity of the orders issued by the State of Mysore under article 13(4) of the Constitution on July 10, 1961, and July 31, 1962.
The petitioners contended that they had applied for admission to the Pre Professional Class in Medicine in the Karnatak Medical College, Hubli and they would have secured admission to the said medical college but for the reservation directed to be made by the orders mentioned above.
They contended that the above mentioned orders were ultra vires.
They prayed for an appropriate writ or order restraining the respondents from giving effect to those orders and requiring them to deal with their applications for admission on merits.
Held, that the petitioners were entitled to an appropriate writ or order as claimed by them and the respondents were restrained from giving effect to the above mentioned orders.
M. R. Balaji vs State of Mysore [1963] Supp. 1 S.C.R. 439, followed.
The impugned orders we quashed only with reference to the additional reservation made in favour of the socially and 476 educationally backward classes and so the respondents were at liberty to give effect to the reservation made in favour of the ' Scheduled Castes and Scheduled Tribes, which was not challenged at all.
The said reservation continues to be operative.


judgement:
Appeal No. 8 of 1953.
Appeal by special leave from the decision dated 16th August, 1951, of the Labour Appellate Tribunal of India, Calcutta, in Appeal No. 43 of 1951 (Cal.).
C. K. Daphtaru, Solicitor General for India, (Sri Narain Andley, with him) for the appellant.
C. P. Varma for the respondent.
March 16.
The Judgment of the Court was delivered by BHAGWATI J.
This is an appeal by special leave from a decision of the Labour Appellate Tribunal 'of India, Calcutta, confirming an award made by the Regional Conciliation Board (Textiles & Hosiery), Kanpur, in an industrial dispute between the appellants and the respondents.
781 The respondents 2, 3 and 4 were employees of the appellants, respondent 2 was employed in the clerical cadre while respondents 3 and 4 were employed as wrapping boy and piecer respectively and their service conditions were governed by the standing orders of the Employers ' Association of Northern India, Kanpur, of which association the ' appellants were members.
There was a theft in the canteen within the mill premises between the night of January 6 and 7, 1950, and some money belonging to the appellants invested in the canteen account was stolen from the safe.
A report of the theft was made to the police authorities and an investigation was made by the police, as well as the appellants in the matter with no result.
The management of the appellants thereafter took action against one J. P. Gurjar, who was in charge of the canteen in connection with the losses of money from the account of the canteen and after the completion of the enquiries terminated his services.
An industrial dispute in respect of the non employment of the said J. P. Gurjar arose between the parties which dispute was at the material time taken in appeal before the Industrial Court (Textiles & Hosiery), Kanpur.
During the pendency of those proceedings, some time in August, 1950, the respondent 4 made a confession in regard to the said theft implicating the respondents 2 and 3 also therein.
On the 29th August, 1950, the management of the appellants presented to the respondents 2,3 and 4 charge sheets in respect of the said theft and suspended them on the 30th August, 1950, from their service.
They also made an application on the 2nd September, 1950, to the Additional Regional Conciliation Officer, Kanpur, asking for permission to dismiss the respondents 2, 3 and 4.
The Additional Regional Conciliation Officer, Kanpur, instituted an enquiry, heard the respondents 2,3 and 4, considered the evidence which was led before him by the appellants as well as the respondents 2,3 and 4 and made an order on the 12th October, 1950, according to the appellants permission for the dismissal of the 782 respondents 2, 3 and 4.
The respondents 2, 3 and 4 were accordingly dismissed from their employ by the appellants with effect from the 13th October, 1950.
An industrial dispute thereupon arose between the appellants and respondents 2, 3 and 4 in respect of the non employment of respondents 2,3 and 4 and respondent 1, a registered trade union, of Which the respondents 2, 3 and 4 were members, ultimately moved the Regional Conciliation Board (Textiles and Hosiery), Kanpur, on the 1st November, 1950, challenging the propriety and bona fides of the appellants in terminating the services of respondents 2, 3 and 4.
The appellants filed their written statement on the 25th November, 1950, contending inter alia that the dismissal was fully justified, regular and proper, having ' been made in accordance with the permission accorded by the Additional Regional Conciliation Officer.
The only issue which was canvassed before the Regional Conciliation Board was whether any or all of the three workmen named in the application dated the 1st November, 1950, has/have been wrongfully dismissed and if so, to what relief is he/they entitled.
The Board consisted of three members, Shri R. P. Maheshwari, Chairman, and Shri B. B. Singh and Shri J. K. Bhagat, Members.
Shri J. K. Bhagat was not present on the last date of the hearing and the award was therefore signed on the 20th April, 1951, by Shri R. P. Maheshwari and Shri B. B. Singh.
Under the terms of the award the Board held that the dismissal was wrongful and that the respondents 2, 3 and 4 were entitled to reinstatement as also to the full wages, including dearness allowance from the date of their suspension to the date they were taken back on duty.
The appellants preferred an appeal to the Labour Appellate Tribunal of India, Calcutta.
The appeal was heard on the 16th August, 1951, and the Labour Appellate Tribunal dismissed the appeal of the appellants.
The appellants obtained special leave from this Court and filed the present appeal.
783 Two contentions were urged by Shri C. K. Daphtary who appeared for the appellants before us (1) that the award was void and inoperative as it was made by only two members of the Board, the third, member, Shri J. K. Bhagat not having been present at the last hearing and not having signed the same and (2) that the Additional Regional Conciliation Officer having given the written permission for dismissal of respondents 2, 3 and 4 no industrial dispute could arise by reason of the non employment of respondents 2, 3 and 4 and the Regional Conciliation Board had therefore no jurisdiction to entertain the application made before it by respondent 1 on behalf of the respondents 2, 3 and 4 and the award of the Regional Conciliation Board ordering the reinstatement of respondents 2, 3 and 4 was therefore without jurisdiction, void and inoperative and the Labour Appellate Tribunal was in error in confirming the same.
In support of his first contention Shri C. K. Daphtary relied upon clause 4 and clause 7, sub clause (3) of the G. N. No. 781 (L)/XVIII, dated 10th March, 1948, issued by the United Provinces Government regarding the constitution of Regional Conciliation Boards and Industrial Courts for the settlement of industrial disputes within the State.
Clause 4 " No business may be transacted at any meeting of any Board unless all the three members are present Clause 7 (3) " Where no amicable settlement can be reached on one or more issues the Board, if all the members thereof agree or if they do not so agree, the majority of,the members agreeing or if no two members agree, the Chairman alone, shall record an award and the reasons for such award, on the issues on which the parties were unable to reach an amicable settlement." Shri C. K. Daphtary therefore urged that Shri J. K. Bhagat not having been present at the last meeting of the Board and not having signed the 784 award the award could not be lawfully made by the Chairman and the other member who were present and who signed the award and the award was therefore void and inoperative.
Shri C. P. Varma who represented the respondent before us however drew tour attention to the Government Order No. 388(11)/ XVIII/37 (LL) /50 dated 2nd March, 1951, which amended the above clauses 4 and 7(3).
Clause 4 as amended provides: " (1) Notice of every meeting of the Board shall be given to the members by the Chairman in advance.
( 2) If apart from the Chairman either or both the other members fail to attend any meeting of the Board of which notice has been given to them, the Chairman may transact the business ' of the Board without the presence of the absent member or members ; and no such business or proceedings, of the Board shall be held invalid merely by reason of the fact that either one or both of the members were not present at the meeting.
" Clause 7 (3) as amended provides: "Where no amicable settlement can be reached on one or more issues, if all the members present agree the Board or if they do not so agree the majority of the members agreeing 'or if no two members present agree or if only the Chairman is present, he alone, shall record an award and the reasons for such award on the issues on which the parties were unable to reach an amicable settlement." These amendments in the clauses 4 and 7 (3) are enough in our opinion to repel the contention of Shri C. K. Daphtary that the absence of Shri J. K. Bhagat from the last meeting and also his non participation in the making and signing of the award rendered.the award void and inoperative.
The Board was empowered under the amended clauses 4 and 7(3) to act in the absence of Shri J. K. Bhagat and the award as it was made and signed by the two remaining members, viz., Shri R. P. Maheshwari and Shri B. B. Singh, was lawful and binding on the parties.
785 In support of his second contention Shri C. K. Daphtary relied upon clauses 23 and 24 of the Government Notification dated the 10th March, 1948, above referred to.
Clause 23 : " Save with the written Permission of the Regional Conciliation Officer or the Assistant Regional Conciliation Officer concerned irrespective of the fact whether an enquiry is pending before a Regional Conciliation Board or the Provincial Conciliation Board or an appeal has been filed before the Industrial Court, no employer, his agent or manager, shall discharge or dismiss any workmen during the continuance of an enquiry or appeal and pending the issue of the orders of the State Government upon the findings of the said Court. . .
Clause 24: "(1) Except as hereinbefore provided every order made or direction issued under the provisions of this Order shall be final and conclusive and shall not be questioned by any party thereto in any proceeding. . .
Shri C. K. Daphtary contended that the order made by the Additional Regional Conciliation Officer on the 12th October ' 1950, giving the appellants permission to dismiss respondents 2, 3 and 4 was final and conclusive in regard to the appellants ' right to dismiss them from their employ and their dismissal accordingly by the appellants could not be the foundation of any industrial dispute which could be referred to the Regional Conciliation Board at the instance of respondent 1.
He further contended that if no industrial dispute could thus arise the Regional Conciliation, Board had no jurisdiction to entertain the same and the award made by the Board was therefore without jurisdiction, void and inoperative and could not also be confirmed by the Labour Appellate Tribunal.
We are unable to accept this contention.
The Government Notification dated 10th March, 1948, was issued by the Governor of the United Provinces in exercise of the powers conferred by clauses (b), (c), 786 (d) and (g) of section 3 and section 8 of the ,United Provinces .
It provided for the constitution by the Provincial Government of such number of Conciliation Boards as might be deemed necessary for the settlement of industrial disputes consisting of three members of which one was to be the Conciliation Officer for the area, one was to be representative of the employers and one was to be the representative of workmen, the Conciliation Officer for the area being the Chairman of the Board.
The order provided for the mode in which industrial disputes may be referred to the Board for enquiry and the manner in which the enquiry was to be conducted.
It also provided for the constitution by the Provincial Government of such number of Industrial Courts as it might be necessary consisting of a President assisted by such equal number of assessors as the President might determine representing employers and employees.
Provision was made for appeals to such Industrial Courts from the awards of the Board and also for the hearing of the said appeals.
After making further provision for the procedure to be adopted before the Boards as well as the Industrial Courts, the Order by clause 23 above mentioned imposed a ' ban on the discharge or dismissal of any workman by the employer, his agent or manager during the pendency of an enquiry before the Regional Conciliation Board or the Provincial Conciliation Board or of an appeal before the Industrial Court except with the written permission of the Regional Conciliation Officer or the Assistant Regional Conciliation Officer concerned and by clause 24 made every order or direction issued under the provisions of the said Government Order final and conclusive except as thereinbefore provided.
It is clear that clause 23 imposed a ban on the discharge or dismissal of any workman pending the enquiry of an industrial dispute before the Board or an appeal before the Industrial Court and the employer, his agent or manager could only discharge or dismiss 787 the workman with the written permission of the Regional Conciliation Officer or the Assistant Regional Conciliation Officer concerned.
Even if such) written permission was forthcoming the employer, his I agent or manager might or might not discharge or, dismiss the workman and the only effect of such written permission would be to remove the ban against the discharge or dismissal of the workman during the pendency of those proceedings.
The Regional Conciliation Officer or the Assistant Regional Conciliation Officer concerned would institute an enquiry and come to the conclusion whether there was a prima facie case made out for the discharge or dismissal of the workman and the employer, his agent or manager was not actuated by any improper motives or did not resort to any unfair practice or victimisation in the matter of the proposed discharge or dismissal of the workman.
But he was not entrusted, as the Board or the Industrial Court would be, with the duty of coming to the conclusion whether the discharge or dismissal of the workman during the pendency of the proceedings was within the rights of the employer, his agent or manager.
The enquiry to be conducted by the Regional Conciliation Officer or the Assistant Regional Conciliation Officer concerned was not an enquiry into an industrial dispute as to the non employment of the workman who was sought to be discharged or dismissed, which industrial dispute would only arise after an employer, his agent or manager discharged or dismissed the workman in accordance with the written permission obtained from the officer concerned.
This was the only scope of the enquiry before the Regional Conciliation Officer or the Assistant Regional Conciliation Officer concerned and the effect of the written permission was not to validate the discharge or dismissal but merely to remove the ban on the powers of the 'employer, his agent or manager to discharge or dismiss the workman during the pendency of the proceedings.
Once such written permission was granted by him that 102 788 ,order made or direction issued by him was to be final land conclusive and was not to be questioned by any party thereto in any proceedings.
The only effect of )clause 24(1) was to prevent any party to the pending proceedings from challenging the written permission thus granted by the officer concerned Such written permission could not be made the subject matter of any appeal at the instance of either party and both the parties would be bound by the order made or direction issued by the officer concerned so far as it gave or refused the permission to the employer, his agent or manager in the matter of the proposed discharge or dismissal of the workman.
This was the only scope of the provisions of clauses 23 and 24 (1) above.
mentioned. ' Once the written permission was granted by the officer concerned, the ban against the discharge or dismissal of the workman would be removed and the employer, his agent or manager could in the exercise of his discretion discharge or dismiss the workman but in that event an industrial dispute within the meaning of its definition contained in section 2(k) of the , would arise and the workmen who had been discharged or dismissed would be entitled to have that industrial dispute referred to the Regional Conciliation Board for enquiry into the Same.
That right of the workman to raise an industrial dispute could not be taken away in the manner suggested by Shri C. K. Daphtary by having resort to the provisions of clauses 23 and 24(1) aforesaid.
That right was given to the workman by the terms of the , and the U.P. , XXVIII of 1947, and would remain unaffected by any of the provisions hereinbefore referred to.
We are therefore, of the opinion that this contention of Shri C. K. Daphtary also fails.
We may before concluding advert to one circumstance and that is that even though the Labour Appellate Tribunal rightly confined its jurisdiction to 789 determining substantial questions of law involved in the appeal, it nevertheless observed that even on the) facts the conclusions of the Board were perfectly justified and there was no substance in the appeal on merits as well.
The appellants were not heard at all on merits; and it was hardly legitimate for the Labour, Appellate Tribunal suo motu to consider the merits of the appeal and arrive at a finding in regard to the same. ' If at all the Labour Appellate Tribunal bad any jurisdiction in regard to the merits it was incumbent upon it to have heard the appellants in regard to the merits before arriving at a conclusion in regard to the same.
The result is that this appeal fails and must be dismissed with costs.
Appeal dismissed.
Agent for the appellant : section section Shukla.

summary/full:
Under the provisions of clauses 4 and 7 (3) of Notification No. 781 (L)/XVIII issued by the United Provinces Government on March 10, 1948, the absence of one of the members of the Regional Conciliation Board on the last date of hearing and his nonparticipation in the making and signing of the award would not render the award void or inoperative.
The dismissal of workmen and their non employment would not cease to be An industrial dispute merely because the Regional Conciliation Officer had given written permission to the employer to dismiss them under clause 23 of the U.P. Government Notification of March 10, 1948.
Such permission does not validate the dismissal but only removes the ban on the right of the employer, his agent or manager to dismiss the workmen concerned during the pendency of proceedings relating to an industrial dispute.


judgement:
Appeals Nos. 378 and 379 of 1962.
Appeals by special leave from the judgment and order dated January 18, 1961 of the Bombay High Court in Miscellaneous petition No. 255 of 1960.
C. K. Daphtary, Solicitor General of India, B. R. L. lyengar and R. H. Dhebar, for the appellants in C. A. No. 378/62 and respondents in C. A. No. 379/62.
A.S. R. Chari, M. K. Ranmmurthi, D. P. Singh, and section C: Agarwala, for the respondent in C. A. No. 378/62 and Appellant in C. A. No. 379162.
791 1962.
October 30.
The judgment of the Court was delivered by GAJENDRAGADKAR, J.
The respondent E.X. Joseph is in the service of the Government of India in the Audit and accounts Department at Bombay.
He was she Secretary of the Civil Accounts Association which consists of non gazetted staff of the Accountant General 's Office.
The said Association was affiliated to the All India Non Gazetted Audit and Accounts Association.
The latter Association had been recognized by the Government of India in December, 1956.
In May, 1959, the Government withdrew recognition of the said Association.
In spite of the withdrawal of the recognition of the said Association, the respondent continued to be its Secretary General and refused to dissociate himself from the activities of the said Association, though called upon to do so.
As a result of his activities, on or about June 3, 1960, he was served with a charge she sheet for having deliberately committed breach of Rule 4(b) of the Central Civil Services (Conduct) Rules, 1955 (hereinafter called the Rules).
Appellant No. 1 0.
K. Ghosh, Accountant General, Maharashtra, who held the enquiry, found the respondent guilty of the charges levelled against him.
Accordingly, a notice to show cause why he should not be removed from service was served on the respondent.
On July 25, 1960, appellant No. 1 served a memo on the respondent intimating to him that it was proposed to hold an enquiry against him for having deliberately contravened the provisions of Rule 4(A) of the Rules in so far as he participated actively in various demonstrations organised in connection with the strike of Central Government employees and had taken active part in the preparations made for the said strike.
On August 8, 1960, the respondent filed a I writ petition on the original side of the Bombay 792 High Court under article 226 of the Constitution and prayed that a writ of certiorari should be issued to quash the charge sheets issued against him by appellant No. 1 in respect of the alleged contravention of Rules 4 (B) and 4 (A) and a writ of prohibition should be issued prohibiting a appellant No. 1 from proceeding further with the departmental proceedings against the respondent.
In his petition, the respondent asked for other incidental reliefs.
The main ground on which the respondent challenged the validity of the departmental proceedings initiated against him was that Rules 4(A) and 4(B) were void in so far as they contravened the fundamental rights guaranteed to the respondent under article 19(1) (a), (b), (c) and (g).
This contention was resisted by appellant No. 1 and appellant No. 2, the Union of India, who had been impleaded as respondents to the said petition.
It was urged on their behalf that the impugned Rules were valid and so, the claim for a writ of certiorari or writ of prohibition was not justified.
The writ petition was heard by a Division Bench of the Bombay High Court.
On January 18, 1961, the High Court rejected the petition in so far as the respondent had claimed writs in regard to the enquiry for breach of Rule 4(A); the Court held that the said Rule was valid and so, the departmental proceedings initiated against the respon dent in respect of the breach of the said Rule could not be successfully impeached.
In respect of the proceedings under Rule 4(B), however, the High Court held that the said Rule was invalid and so, the departmental proceedings in respect of the breach of the said Rule have been quashed.
It is against this decision that the appellants, the A.G. and the Union of India, have come to this Court by Appeal No. 378/1962; whereas E. X.Joseph the respondent, has preferred Appeal No. 379/1962: Both the appeals have been brought to this Court by special leave.
793 The appellants contend that the High Court was in error in holding that Rule 4(B) was invalid, whereas the respondent urges that Rule 4(A) was invalid and the decision of the High Court to the contrary is erroneous in law.
Before dealing with the contentions of the parties, it is necessary to set out the two impugned Rules.
These Rules form part of a body of Rules framed in 1955 under article 309, of the Constitution.
Rule 4 A provides that no Government servant shall participate in any demonstration or resort to any form of strike in connection with any matter pertaining to his condition of service,.
whereas Rule 4 B lays down that no Government servant shall join or continue to be a member of any Service Association of Government servants : (a) which has not, within a period of six months from its formation, obtained the recognition of the Government under the Rules prescribed in that behalf, or (b) recognition in respect of which has been refused or withdrawn by the Government under the said Rules.
The case against the respondent is that he has contravened both these Rules.
The question about the validity of Rule 4 A has been the subject matter of a recent decision of this Court in Kameshwar Prasad vs The State of Bihar (1).
At the hearing of the said appeal, the appellants and the respondent had intervened and were heard by the Court.
In that case, this Court has held that Rule 4 A in the form in which it now stands prohibiting any form.
of demonstration is violative of the Government servants ' rights under article 19(1)(a) & (b) and should, therefore, be struck down.
In striking down the Rule in this limited way, this Court made it clear that in so far as the said Rule prohibits a strike, it cannot be struck down for the reason that there is no fundamental right to resort to a strike.
In other words, if the Rule was (1) [1962] Supp. 3 S.C.R. 369. 794 invoked against a Government servant on the ground that be had resorted to any form of strike specified by Rule 4 A, the Government servant would not be able to contend that the Rule was invalid in that behalf.
In view of this decision, we must hold that the High Court was in error in coming to the conclusion that Rule 4 A was valid as a whole.
That takes us to the question about the validity of Rule 4 B.
The High Court has held that the impugned Rule contravenes the fundamental right guaranteed to the respondent by article 19 (1) (c).
The respondent along with other Central Government servants is entitled to form Associations or Unions and in so far as this right is prejudicially Rule, the said Rule is invalid.
The learned Solicitor General contends that in deciding the question about the validity of the Rule, we will have to take into account the provision of clause (4) in article 19.
This clause provides that article 19(1) (c) will not affect the operation of any existing law in so far as it imposes, in the interests of public order or morality, reasonable restrictions on the exercise of the right conferred by the said sub clause.
The argument is that the impugned Rule does nothing more than imposing a reasonable restriction on the exercise of the right which is alleged to have been contravened and, therefore, the provision of the rule is saved by clause (4).
This argument raises the problem of construction of clause (4).
Can it be said that the Rule imposes a reasonable restriction in the interests of public order ? There can be no doubt that Government servants can be subjected to rules which are intended to maintain discipline amongst their ranks and to lead to an efficient discharge of their duties Discipline amount Government employees and their efficiency may,in a sense, be said to be related to public order.
But in considering the scope of clause (4), it has to be borne in mind that the rule must be 795 in the interests of public order and must amount to a reasonable restriction.
The words "public order" occur even in clause (2), which refers, inter alia, to security of the State and public order.
There can be no doubt that the said words must have the same meaning in both clauses (2) and (4).
So far as clause (2) is concerned, security of the State having been expressly and specifically provided for, public ' order cannot include the security of State, though in its widest sense it may be capable of including the said concept.
Therefore, in clause (2), public order is virtually synonymous with public peace, safety and tranquility.
The denotation of the said words cannot be any wider in clause (4).
That is one consideration which it is necessary to bear in mind.
When clause (4) refers to the restriction imposed in the interests of public order, it is necessary to enquire as to what is the effect of the words "in the interests of".
This clause again cannot be interpreted to mean that even if the connection between the restriction and the public order is remote and indirect, the restriction can be said to be in the interests of public order.
A restriction can be said to be in the interests of public order only if the connection between the restriction and the public order is proximate and direct.
Indirect or far fetched or unreal connection between the restriction and public order would not fall within the purview of the expression "in the interests of public order.
" This interpretation is strengthened by the other requirement of clause (4) that.
, by itself, the restriction ought to be reasonable.
It Would be difficult to hold that a restriction which does not directly relate to public order can be said to be reasonable on the ground that its connection with public order is remote or far fetched.
That is another consideration which is relevant.
Therefore, reading the two requirements of clause (4), it follows that the impugned restriction can, be said to satisfy as the test of clause (4) only if its. connection with public order is shown to be rationally proximate and direct, 796 That is the view taken by this Court in The Superintendent Central Prison, Fatehgarh vs Dr. Ram Manohar Lohia, (1).
In the words of Patan jali Sastri .T., in Rex vs Basudev,(2) "the connection contemplated between the restriction and public order must be real and proximate, not far fetched or problematical.
" It is in the light of this legal position that the validity of the impugned rule must be determined.
It is not dispute that the fundamental rights guaranteed by article 19 can be claimed by Government servants.
article 33 which confers power on the parliament to modify the rights in their application to the Armed Forces, clearly brings out the fact that all citizens, including Government servants, are entitled to claim the rights guaranteed by article 19.
Thus, the validity of the impugned rule has to be judged on the basis that the respondent and his co employees are entitled to form Associations or Unions.
It is clear that Rule 4 B imposes a restriction on this right.
It virtually compels a Government servant to withdraw his membership of the Service Association of Government Servants as soon as recognition accorded to the said Association is withdrawn or if, after the Association is formed, no recognition is accorded to it within six months.
In other words, the right to form an Association is conditioned by the existence of the recognition of the said Association by the Government.
If the Association obtains the recognition and continues to enjoy it, Government servants can become members of the said Association ; if the Association does not secure recognition from the Government or recognition granted to it is withdrawn, Government servants must cease to be the members of the said Association.
That is the plain effect of the impugned rule.
Can this restriction be.
said to be in the interests of public order and can it be said, to be a reasonable restriction ? In our opinion, the only answer to these questions would be in the negative.
It is difficult to see any direct or proximate (1) ; [1949] S.C.R. 657,661.
797 or reasonable connection between the recognition by the Government of the Association and the discipline amongst, and the efficiency of, the members of the said Association.
Similarly, it is difficult to see any connection between recognition and public order.
A reference to Rule 5 of the Recognition of Service Association Rules recently made in 1959 would clearly show that there is no necessary Connection between recognition or its withdrawal and public order.
Rule 5 enumerates different conditions by clauses (a) to (1) which every Service Association must comply with; and Rule 7 provides that if a Service Association recognised under the said Rules has failed to comply with the conditions set out in Rule 4, 5, or 6, its recognition may be withdrawn.
One of the conditiOn imposed by Rule 5(1) is that communications addressed by the Service Association or by any office bearer on its behalf to the Government or a Government authority shall not contain any disrespectful or improper language.
Similarly, Rule 5(g) provides that the previous permission of the Government shall be taken before the Service Association seeks affiliation with any other Union, Service Association or Federation; and Rule 5 (h) prohibits the Service Association from starting or publishing any periodical, magazine or bulletin without the previous approval of the Government.
It is not easy to see any rational, direct or proximate connection between the observance of these conditions and public order.
Therefore, even without examining the validity of all the conditions laid down by rule 4, 5 or 6, it is not difficult to hold that the granting or withdrawing of recognition may be based on considerations some of which have no connection whatever either with the efficiency or discipline amongst the Services or with public order.
It might perhaps have been a different matter if the recognition or its withdrawal had been based on grounds which have a direct, proximate and rational connection with public order.
That however 798 cannot be said about each one of the conditions prescribed by rule 4, 5 or 6.
Therefore, it is quite possible that recognition may be refused or withdrawn on grounds which are wholly unconnected with public J. order and it is in such a set up that the right to form Associations guaranteed by article 19(1)(c) is made subject to the rigorous restriction that the Association in question must secure and continue to enjoy recognition from the Government.
We are therefore, satisfied that the restriction thus imposed would make the guaranteed right under article 19(1)(c) ineffective and even illusory.
That is why we see no reason to differ from the conclusion of the High Court that the impugned Rule 4 B is, ' invalid.
In the result, appeal No. 378/1962 fails and is dismissed.
In regard to appeal No. 379/1962, though we have partly reversed the conclusion of the High Court in respect of the validity of the whole of Rule 4 A. it appears that the departmental proceedings initiated against the respondent in respect of,the alleged breach of rule 4 A have to be quashed, because the alleged contravention of the said Rule on which the said proceedings are based is contravention of that part of Rule 4 A which has been held to be invalid by this Court.
The material charge against the respondent in that behalf is that he had deliberately contravene the provisions of Rule 4 A in so far as he has participated actively in the various demonstrations organised in connection with the strike of Central Government employees and took part in the preparations made for the said strike.
It will be noticed that the result of the decision of this Court in Kameshwar Prasad 's(1) case is that in so far 'as the rule prohibits any form of demonstration, it is invalid.
It is not invalid in so far as it may prohibit participation in strikes.
The charge against the respondent is not that he participated in any strike ; the charge is that he participated in the various demonstrations ; and that is a charge based upon that part of (1) [1962] Supp.
3 S.C.R. 369. 799 the rule which prohibits demonstrations altogether.
It is true that the demonstrations in which he is alleged to have participated actively were organised in connection with the strike ; but that does not mean either in fact or in law that he participated in the strike itself.
Similarly, the charge that he took active part in the preparations made for the said strike, also does not mean in fact or in law that he participated in the strike.
If he joined demonstrations organised in connection with the strikes, or if he took part in the preparations for the strike, it cannot be said that he took part in the strike as such, and so, the charge cannot be reasonably construed to mean that his conduct amounted to a contravention of the rule which prohibits strikes.
Therefore, though Rule 4 A is partly, and not wholly, invalid as held by this Court in the case of Kameshwar Prasad(1), the particular charge against the respondent being on the basis of that part of the rule which is invalid, it must follow that the departmental proceedings based on that charge are also invalid.
That is why appeal No. 379/1962 must be allowed and the departmental proceedings instituted against the respondent for the alleged contravention by him of rules 4 A and 4 B must be quashed.
There would be no order as to costs.
Appeal 378/62 dismissed.
Appeal 379/62 allowed.
(1) [1962] Supp. 3 S.C.R. 369.

summary/full:
The respondent, A Central Government servant, who was the Secretary of the Civil Accounts Association of non Gazetted Staff, was departmentally proceeded against under rr.
4(A) and 4(B) of the Central Civil Services (Conduct) Rules, 1955, for participating in demonstrations in preparation of a general strike of Central Government employees and for refusing to dissociate from the Association after the Government had withdrawn its recognition of it.
He impugned, the validity of the said rules on the ground that they infringed his fundamental rights under article 19 of the Constitution.
The High Court held that r. 4(A) was wholly valid but quashed the proceeding under r. 4(B) which it held to be invalid.
Rule 4(A) provided that no Government servant shall participate in any demonstration or resort to any form of strike in connection with any matter pertaining to his conditions of service and r. 4(B) provided that no Government servant shall join or continue to be a member of any services Association which the 790 Government did not recognise or in respect of which recognition had been refused or withdrawn by it.
Held, that in view of the decision of this Court that r. 4(A) of the Central Civil Services (Conduct) Rules, 1955, in so far as it prohibited any form of demonstration was violative of the Government servants ' fundamental rights under article 19(1) (a) and (b), the High Court was in error in holding that the rule was wholly valid.
Kameshwar Parsad vs The State of Bihar, [1962] supp.
3 S.C.R. 369, referred to.
Participation in demonstration organised for a strike and taking active part in preparation for it cannot, either in law or fact, mean participation in the strike.
The respondent could not, therefore, be said to have taken part in a strike as such and the proceeding against him under section 4(A) being based on that part of it which was invalid must also be invalid.
It was clear that r. 4(B) of the said Rules imposed res triction on the undoubted ' right of the Government Servants under article 19 which were neither reasonable nor in the interest of public order tinder article 19(4).
The rules clearly showed that in the granting or withdrawing, of recognition, the Government right be actuated by considerations other than those of efficiency or discipline amongst the services or public order.
The restriction imposed by r.4 (B), therefore, infringed article 19(1) (c) and must be held to be invalid.
The Super tenant, Central Prison, Fatehgarh vs Dr. Ram Manohar Lohia, ; and Rex vs Basudev, , referred to.


judgement:
ppeal No. 286 of 1960.
Appeal by special leave from the judgment and decree dated March 26, 1958, of the Patna High Court in Second Appeal No. 1330 of 1954.
N.C. Chatterjee and R. C. Prasad, for the appellant.
section N. Andley and section P. Varma, for the respondent No. 1. 1962.
November 9.
The judgment of the Court was delivered by DAS GUPTA, J.
The subject matter of this litigation is a plot of land measuring 1267 sq.
in the Sakchi New Planning area in the town of Jamshedpur.
On June 23,1937, Abdul Gani, through whom the present appellant claims to be interested in the land, applied for settlement of this plot of land to the Land Officer of the owner of the land, the Tata Iron and Steel Company Ltd. The application was allowed and the land was let out to Abdul Gani as a tenant from month to month at a rent of Re. 1/per month.
The suit out of which this appeal has arisen was brought in 1949 for ejectment of the tenant after determination of the tenancy by a notice to quit the premises.
There was also, a prayer for arrears of rent at Re 1/ per month.
The defence of Abdul Gani was that he was an agriculturist tenant as contemplated under the 3 Ghotanagpur Tenancy Act and not a monthly tenant and that no monthly rent was paid for the land It 'was, also pleaded that the lease being for agricultural and horticultural purposes at an annual rent, the defendant acquired a valid occupancy right and was not liable to ejectment.
The present appellant was added as a defendant by an order dated May 25, 1953.
He also filed a written statement contending that by operation of the provisions of Chotanagpur Tenancy Act, Abdul Gani had acquired occupancy right, that the purpose for which settlement was made with Abdul Gani could not create a monthly tenancy and the plaintiff was not entitled to Khas possession.
The Trial Court (The Additional Munsif, Jamshedpur), accepted the defence plea that the tenancy created in favour of Abdul Gani was agricultural, that Abdul Gani had acquired an occupancy raiyat 's right therein and as the tenancy Act was governed by the Chotanagpur Tenancy Act the suit was not triable by a civil court.
Accordingly, he dismissed the suit.
On appeal the Subordinate Judge, Singhbhum, with the findings of the Trial Court that the holding was agricultural and therefore governed by the Chotanagpur Tenancy Act and accordingly affirmed the judgment and decree of the Trial Court.
The High Court of judicature at Patna however came to the conclusion in Second Appeal that the lease was not for agricultural and horticultural purposes and there was no question.
of the defendant having acquired the right of occupancy in the land.
The High Court allowed the appeal, set aside the judgment and decree of the courts below and decreed the plaintiffs suit.
Against this decision of the High Court this appeal has been filed by special leave granted by this Court.
4 In support of the appeal it is urged before us by Mr. N. Chatterjee, that the High Court erred in holding that the lease was not for agricultural or horticultural purposes.
He points out that the application for lease of the land mentions ""garden purpose" as the purpose of the tenancy, and argues that that is sufficient to make Abdul Gani a raiyat within the meaning of section 6 of the Chotanagpur Tenancy Act.
Section 4 of the Act states that for the purpose of this Act there shall be four classes of tenants, namely, (1) tenure holders,(2) raiyats, (3) under raiyats and(4)Munderi Khunt kattidars.
Admittedly ' and obviously, Abdul Gani was not a tenant under classes 1, 3 and 4 and the only way he could come within the ambit of Chotanagpur Tenancy Act was by being a "raiyat" as mentioned in class (2).
"Raiyat" is defined in section 6 of this Act to mean "primarily a person who has acquired a right to hold land for the purpose of cultivating it by himself or by 'members of his family or by hired servants. or with the aid of partners ; and includes the successors in interest of persons who have acquired such a right It has been settled by a number of decisions of the Calcutta and the Patna High Courts that the purpose of planting an orchard comes within " 'the purpose of cultivation.
" If it appears that Abdul Gani took lease of the land in dispute for the purpose of growing an orchard he clearly became a raiyat ' under the Chotanagpur Tenancy Act.
While there is no document creating the lease we have, in the present case, Abdul Gani 's application for lease and the landlord 's order granting the lease.
The application is in these words: "I beg to apply for a plot of land measuring 1267 sq It.
in Sakchi New Planning for Garden Purpose and for permission to retain one step in the east side.
I agree to hold the land on monthly tenancy and to abide by the terms and conditions of the 5 Company and the house building rules.
I also agree to abide by the rules and bye laws of the Jamshedpur Notified Area Committee in force from time to time.
I agree to pay the security deposit to be fixed by you in respect of my tenancy as soon as the plot IS allotted to me and shall submit the plan of MY proposed house for approval of the Chief Town Engineer before I start construction.
I therefore request that you will kindly allot me a plot of land in the above mentioned Basti on your usual terms." Mr. Chatterjee fastens on the words "for garden purpose" and argues that that shows clearly that the purpose was to grow an orchard.
It will not be proper however to look only at this one phrase "for garden purpose" and to ignore the rest of the document.
It has to be noticed that after stating in the first sentence that he wanted the land "for garden purpose" Abdul Gani stated in the next paragraph that he agreed to hold the land "on monthly tenancy" and again that he agreed "to abide by the terms and conditions of the Company and the house building.
rules.
" It is difficult to conceive of a lease for cultivation being taken on a monthly tenancy.
It is even more difficult to understand why Abdul Gani would agree "to abide by the house building rules" if I the purpose was only to grow an orchard.
These two facts, namely, that the land would be held on monthly tenancy and the tenant would abide by the house building rules, have to be considered along with the earlier statement that the land was being applied " 'for garden purpose.
" The terms of the application for lease are, in our opinion, sufficient to show that the lease was not for an agricultural or horticultural purpose.
In view of this, it is unnecessary to investigate how the land was actually used.
It may be mentioned however that if one did examine the evidence to 6 find out such user, it becomes clear that while a part of the land was used for growing some guava, trees and some flowers, a pacca room was also erected: on a portion of the land.
On a consideration of all these things we find ourselves in agreement with the High Court that the purpose of the lease was not agricultural or horticultural.
We have, therefore, come to the conclusion that the High Court was right in decreeing the plaintiff 's suit.
The appeal is accordingly dismissed with costs.
Appeal dismissed.

summary/full:
The predecessor in interest of the present appellant applied to the land officer of the respondents for the settlement of the subject,matter of dispute, situated in,Jamshedpur.
The land was let out to him as tenant from month to month at a rent of Re. 1 / per month.
There was no document creating the lease.
The application for settlement contained averments to the effect that the applicant wanted it 1 for garden purposes" that he agreed to hold the land "on monthly tenancy" and that would abide by the "house building rules".
Following a notice to quit the respondents who are the owners of the plot filed a suit for eviction of the appellant and for arrears of rent.
The defence raised was that there was no monthly tenancy and the lease was for agricultural and horticultural purposes and the appellant was an agricultural tenant within the meaning of sections 4 and 6 of the Chotanagpur Tenancy Act who has fixity of tenure.
_The trial court upheld the contention and on appeal it was confirmed by the Subordinate Judge.
On second appeal the High Court of Patna held that the lease was not for agri cultural purposes and ordered eviction.
The present appeal is by way of special leave granted by this Court.
The main contention before this Court was that since the application for Jew made it clear that the land was for "garden 2 purpose" the appellant was raiyat within the meaning of section 6 of the Act.
Held, that the statement of the purpose had to considered alongwith the other facts mentioned in the document, viz. that the application was for a monthly tenancy, and that the applicant agreed to abide by the house building rules.
On such consideration, it was clear that the lease was not for horticultural or agricultural purposes.


judgement:
Appeal No. 201/60.
Appeal by special leave from the judgment and order dated June 18, 1958, of the Bombay High Court, Nagpur, in Misc.
No. 391 of 1956.
M.C. Setalvad, Attorney General for India, section N. Andley, and Rameshwar Nath, for the appellant.
S.N. Kerdekar, N. K. Kherdakar and A. G. Ratnaparkhi, for the respondent No. 1. 1962.
November 8.
The judgment of the Court was delivered by 970 GAJENDRAGADKAR J.
This appeal raises a ' short question about the construction of clauses 23, 24 and 24 A in The Central Provinces and Berar Letting of Houses and Rent Control Order, 1949 (hereinafter called the Order).
jogeshwar s/o Parmanand Bhishikar (hereinafter called the respondent) owns a house known as the Bhishikar Bhawan in Nagpur.
Block No. 2A had been let out by him to a firm known as the Dayalbagh Stores for carrying on business.
Since the tenant was in arrears as to rent,, the respondent obtained from the Rent Control Authorities permission to terminate the said tenancy.
Meanwhile, the tenant intimated to the respondent by telegram on July 24, 1955, that it had vacated the said premises on that day.
Prior to the receipt of this telegram, however, the appellant Chimandas Bagomal Sindhi had made an application to the Addl.
Commissioner, Nagpur, on July 15, 1955, that the premises occupied by the said tenant were likely to fall vacant, and prayed that the same should be allotted to him as he was a displaced person within the meaning of the Order.
The Addl.
D. C. passed an order of provisional allotment in favour of the appellant on the same day and since then, the appellant has been in possession of the said premises.
The respondent then came to know about the said provisional allotment and gave intimation to the Addl.
D. C. that he needed the, premises for his own purposes, and so, he moved for the cancellation of the said provisional allotment order.
On July 23, 1956, the Addl. D. C. purporting to exercise his powers under clause 23 (1) of the Order confirmed the provisional allotment in favour of the appellant.
The respondent then moved the Nagpur High Court by a writ petition No. 307 of 1955 for cancellation of the said order.
On April 10, 1956, Mr.Justice Bhutt set aside the order of allotment and remanded the case for disposal in accordance with 971 law.
That is how the first stage of this dispute came to an end.
On remand, the Addl.
Commissioner confirmed the earlier order.
He held that the respondent did not need the premises for his own occupation and he thought that there was no going back on the earlier provisional order of allotment in favour of the appellant.
This second order was challenged by the respondent by another writ petition filed in the Nagpur High Court (No. 391 of 1956).
Meanwhile, the appellant had filed a Letters Patent Appeal (No. 95 of 1956) against the decision of Bhutt, J., on the earlier writ petition filed by the respondent.
By consent, the said Letters Patent Appeal and the subsequent writ petition filed by the respondent were heard together by a Division Bench of the High Court. 'The Division Bench has set aside the order of allotment passed in favour of the appellant and allowed the subsequent writ petition filed by the respondent.
It is against this order that the appellant has come to this Court by special leave.
It appears that after remand, the respondent .brought it to the notice of the Addl. D. C. that the appellant owned As. /4/ share in the Hind Vastra Bhandar and that he had, therefore a place where he could carry on his business.
This allegation was repeated by the respondent in his second writ petition and it was urged by him that in view of the fact that the appellant had a place of business of his own, he was not entitled to the accommodation alloted to him by the impugned order.
This plea was met by the appellant on the ground ' that the business mentioned by the respondent bad been dissolved.
From the affidavit filed by the appellant in that behalf it does appear that the appellant had a share in the Hind Vastra Bbandar and Krishna Watch Co. both of which Partnerships carried on their business at Nagpur, but on 972 April 8, 1957 the said partnerships had been dissolved and so, after the said date of dissolution there was no place of business to which the appellant could lay any claim.
In support; of this plea, the appellant has filed the deed of Dissolution in question.
, The High Court has held that reading the definition of the words "displaced person prescribed by clause 2 (2) together with the relevant clause of the Order under which the impugned allotment had been made in favour of the appellants it must be, held that the appellant was not a displaced person and as such, he was not entitled to the said allotment.
That is how the main point which arises for our decision in the present appeal is 'about the construction of the said relevant clauses of the Order.
The order had been passed by the Government of the Central Provinces, and Berar by virtue of the powers conferred on it by section 2 of the Central provinces and Berar Act No. XI of 1946.
Sub clause (2)of clause 2 defines A displaced person as meaning any person who, on account of the setting up of the Dominions of India and Pakistan, or on account of civil disturbances or fear of such disturbances in any area now forming part of Pakistan has been displaced from or has left his place of residence in such area after the 1st day of March, 1947, and who has subsequently been residing in India.
The Appellant claims to be such a displaced person.
Clause 13 provides, inter alia, that the landlord would be entitled to claim ejectment of his tenant if he shows that he needs the house or portion thereof for the purpose of his bona fide residence, provided he is not occupying any other residential house of his own it the city or town concerned.
He can also obtain: ejectment of his tenant if it is shown that the,, tenant has secured alternative accommodation or has left the area for a continuous 973 period of four months and does not reasonably need the house.
Clauses 22 to 27 form part of Chapter III which deals with the collection of information and letting, "of accommodation.
Clause 22 (1) provides that every landlord of a house situate in an area to which this Chapter applies, shall give intimation about the impending vacancy as specified by subclauses (a) and (b).
s Clause 22 (2) lays down that no person shall occupy any house in respect of which this Chapter applies except under an order under sub clauses (1) of clause 28 or clause,, 24 or on an assurance from the landlord that the house is being permitted to be occupied in accordance with sub clause (2) of clause 23.
It would thus be noticed that all vacancies occurring in houses governed by ' Chapter III have to be filled in the manner specified by clause 22 (2).
Clause 23(1) provides that on receipt of the intimation under; clause 22, the, Dy.
Commissioner may within fifteen days from the date of receipt of the said intimation, order the landlord to let the vacant house to any person holding an, office of profit under; the Union or State Government or to any Person holding it post under the Madhya Pradesh Electricity Board, or to a displaced person or to an evicted, person and thereupon. ' notwithstanding any agreement to the contrary, the landlord shall let the house to such person and place him in possession thereof immediately, if it is vacant or as soon as it becomes vacant.
The proviso to this sub clause gives right to the, landlord to plead that he needs the house for his own occupation, and if such a plea is accepted by theDy.
Commissioner, the landlord would, be allowed to occupy the same.
In other words, in cases falling underclause 23 (1) before the D.C.makes an order directing the landlord to let the house to one of the personsspecified.
in the different categories by that clause, it would be open to the landlord to urge 974 his own need and if that need is established, an order ' under clause 23(11) would not be passed against him.
Clause 23(2) provides that if no order is passed and served upon the landlord within the period specified in sub clause (1), he shall be free to let the vacant house to any person.
Clause 24 provides for the penalty for noncompliance with the. requirements of clause 22(1).
Under this clause, the Dy.
Commissioner is empowered to order the landlord to let the house forthwith to any of the persons falling under the categories specified by that clause.
Since the power conferred on the D. C. to make an order under this clause is intended, in a sense, to punish the landlord for his contra vention of clause 22, it prima facie appears that the landlord is not given an opportunity to ' prove his own need as under the proviso to 23 (1).
Clause 24 A deals with cases where the Dy.
Commissioner receives information to the effect that a house is likely to become vacant or available for occupation by a particular date ; and in such cases it empower.% the Dy.
Commissioner to, make an,.
order on the same lines as provided by clause 23(1).
This clause lays down that the order passed under it shall be complied with by the landlord unless the house does not become vacant or available for occupation within one month from the date of receipt by him of the said order, or the landlord applies for the cancellation of the said order stating his grounds thereof.
This provision means that an order passed under clause 24A can be challenged by the landlord by pleading that he needs the premises for himself That, in brief, is the scheme of the relevant provisions.
The High Court has taken the view that in allotting the premises in question to the appellant ' the Addl. D. C. has failed to notice the fact that on July 15, 1955, when the provisional allotment order 975 was passed, the appellant had a place of business of his own inasmuch as he was a 4 annas sharer in a partnership which had its place of business.
According to the High Court, as soon as it appeared that the appellant had a place of business of his own, he ceased to be a displaced person within the meaning of clause 23(1) and the other relevant clauses.
This conclusion proceeded on the basis that though the appellant may be taken to have satisfied the require ments of the definition of the expression "displaced person" under clause 2(2), that definition had to be read in the light of the context of clause 23(1) and its meaning had to be controlled by the said context.
Clause 2 begins with the words that in this Order, unless there is anything repugnant in the subject or context, the defined terms will carry the meaning assigned to them by the respective definitions.
The whole object of enabling the Dy.
Commissioner to make an order of allotment in respect of the persons specified in different categories by the relevant clause, is to provide accommodation to those persons who were without any accommodation.
Since that object is implicit in the relevant provision, the definition must be construed in the light of the said implicit assumption of the relevant provision.
It is on this view that the impugned order has been set aside by the High Court.
It may be conceded that prima facie the view taken by the High Court appears to be attractive.
It does appear to be reasonable that provisions of the kind contained in Chapter III would normally be expected to assist persons of specified categories to obtain accommodation and that would impliedly postulate that such persons have, no accommodation which they can claim their own.
If the words of the relevant provision are ambiguous, or if their effect can reasonably be said to be a matter of doubt, it may be permissible to construe the said provisions in the light of the assumption made by the High 976 Court.
But, arc the words of the relevant in any sense ambiguous, or is the effect of those words doubtful ? In our opinion, the answer to these questions must be in the negative.
Clause 23 (1) refers to the persons in the specified categories, and empowers the D.C. to make an order of allotment in their favour.
There are no terms of limitation qualifying the said persons and the scheme of the relevant provisions does not seems, to contemplate any such limitations It 'is significant that the said persons are not entitled as a matter of right to an order of allotment.
What clause 23(1) does is to confer power on the D.C. to make an order of allotment if he thought it OX expedient, fair to do so in a particular case.
it is only where an order is made by the D.C. that an obligation is imposed on the landlord to let the premises to the person named in the order.
Having regard to the words used in describing the persons "and the categories, it seems plain that the provision Contemplated that a person belonging to one of those categories may be entitled to claim its benefit 'on the ground that accommodation already available to him was patently insufficient or unsuitable. ' When such a plea is made, the D. C. may have to consider it Arid in doing so, "he may have to examine the contentions raise landlord against such a plea as Well as the claim that the landlord may make for his own personal occupation.
The enquiry which would thus become necessary would be in the nature of a enquiry and, the power conferred on ' the D. 'C. may have to be exercised in a flair and just manner.
We do not think that clause 23 (1) as well as clauses 24 and 24 A necessarily exclude 'the cases 1 of person 's specified in them on the grounds that the said persons already have an accommodation which they can call their own.
Persons there specified would no doubt have a much better claim for accommodation if is shown that they have no accommodation at all.
But 977 even if such persons have accommodation, their claims cannot be ruled out on the preliminary ground that the very fact that they have accommodation takes them out of the provisions of the respective clauses.
It is quite true that if a person belonging Ca, to the specified categories has suitable and sufficient accommodation, he would normally not be entitled to claim the benefit of clause 23(1).
That, however, is a matter to be considered by the Dy.
Commissioner on the merits.
We are, therefore, satisfied that the High Court was in error in assuming that the provisions of clause 23(1) and clauses 24 and 24A impliedly postulate that the persons belonging to the respective categories specified by them can receive allotment only if they have no previous accommodation of their own.
That being so, we must hold that the appellant 's case cannot be thrown out merely on the ground that he had other accommodation by virtue of the fact that he was a partner in two concerns to which we have already referred.
This conclusion cannot, however, finally dispose of the appeal before us because it seems to us that after the remand order was passed by Mr. justice Bhutt, the Addl.
D.C. has not dealt with the matter in accordance with law as he was required to do.
He appears to have taken the view that since a provisional order had already been passed, there was "no going back" upon it.
He thought that after remand, the scope of the enquiry was confined to the examination of the question as to whether the respondent proved that he needed the premises for his own occupation.
It is true that he has incidentally mentioned the fact that the appellant owned a /4/ share in the business which was carried on in Nagpur, but he has added that the said fact does not preclude him from obtaining a shop for starting a business exclusively of his own.
This observation shows that the Addl.
D.C. did not properly appreciate the scope and effect of the 978 provision contained in the relevant clause.
Besides, reading the order as a whole, it is quite clear that he took an unduly narrow view of the limits of the enquiry which he was bound to hold as a result of the remand order and that has vitiated his final conclusion.
We, therefore, think that it is necessary that the matter should be sent back to the Addl.
Commissioner, Nagpur, with a direction that he should consider the case on the merits afresh.
We wish to make it clear that the question as to whether the appellant should be given allotment of the premises in question should be determined by the Addl.
D. C. in the light of the position as it stood on July 15, 1955.
We are making this observation because there has been some controversy before us as to whether the appellant has lost his right in the premises belonging to the partnership of which admittedly he was a member by reason of the fact that the, said partnership is alleged to have been dissolved on April 8, 1957.
The learned Attorney General has contended that if the matter has to go back, the Addl.
D.C. should be free to consider the subsequent events that have taken place, and the appellant 's case should, therefore, be dealt with on the basis that he has no longer any shares in the said partnerships.
We are not inclined to accept this contention.
The fact that the present proceedings have been protracted would not entitle the appellant to ask the Addl.
D.C. to take subsequent events into account.
It is clear that the dissolution of the partnership took place long after the appellant obtained the provisional allotment from the Addl.
D.C. and it is by no means clear that if the Addl.
D.C. had been then told that the appellant had a place of business of his own, he would have granted accommodation to him in the present premises on the same day that he moved him in that behalf.
We are satisfied that the question about the propriety and validity of the said provisional order must be judged in the light of the facts as they obtained on that day.
979 Mr. Kherdekar for the respondents wanted to argue before us that under cl.
2(2) the appellant was not a displaced person on that day and he has relied on the fact that the appellant had been carrying on business in several places in India, since 1945.
This point has not been considered either by the Addl.
D.C. or the High Court.
If so advised, the respondents may take this point before the Addl.
D.C. and we have no doubt that if raised, it would be dealt with by the Addl.
D.C. in accordance with law.
The result is, the appeal is allowed, the order passed by the High Court on the writ petition is set aside and the matter is remanded to the Addl.
Commissioner, Nagpur, with a direction that he should deal with the dispute between the parties afresh in accordance with law.
Costs incurred by the parties so far would be costs in the final order which may be passed after remand.
Appeal allowed.

summary/full:
The respondent had let out his house to a firm against whom he obtained permission from the Rent Control Authority to terminate the tenancy on the ground of arrears of rent.
Meanwhile, the tenant intimated to the respondent by telegram that he had vacated the premises, but prior to the receipt of the telegram, the appellant bad applied to the Additional Deputy Commissioner that since the premises were likely to fall vacant, they should be allotted to him as he was a displaced person, and provisional allotment was made in his favour and he continued to be in possession since then.
The respondent then moved for the cancellation of the said allotment on the ground that he needed the premises for his own use, but the allotment was confirmed in favour of the appellant by, the Additional Deputy Commissioner.
The respondent then filed a writ petition in the High Court for cancellation of the said order, which was set aside and the case was remanded for disposal in accordance with law; against this the appellant filed a Letters Patent Appeal.
On remand the earlier order was confirmed by the Additional Deputy Commissioner, against which the respondent filed another writ petition in the High Court.
The Letters 969 Patent Appeal and the subsequent writ petition were heard together and the High Court allowed the writ petition and set aside the order of allotment in favour of the appellant on the ground that as soon as it appeared that the appellant had a place of business of his own, he ceased to be a displaced person within the meaning of cl.
23(1) and the other relevant clauses.
Held, that cl.
23(1) refers to the persons in the specified categories and empowers the Deputy Commissioner to make an order of allotment in their favour.
There are no terms of limitation qualifying the said persons and the scheme of the relevant provision does not seem to contemplate any such limitation.
Clause 23(1), as well as cls.
24 and 24A do not necessarily exclude the cases of persons specified in them on the ground that the said persons already have an accommodation of their own and the High Court was in error in assuming that the provisions of cis.
23(1),24 and 24A impliedly postulated that the persons belonging to the respective categories specified by them could receive allotment only if they had no previous accommodation of their own.
Held, further, that after remand the Additional Deputy Commissioner did not properly appreciate the scope and effect of the provision contained in the relevant clause and he took an unduly narrow view of the limits of the enquiry which he was bound to hold as a result of the remand order and that has vitiated his final conclusion.