judgement:
Appeals No. 723 of 1966.
Appeal by special leave from the judgment and order dated July 25, 26, 1964.
of the Gujarat High Court in Special Civil Application No. 31 of 1962.
336 R. H. Dhebar, Urmila Kapoor and section P. Nayar, for the appellant.
Purshottam Trikamdas and I. N. Shroff, for respondent No. 1.
N. section Bindra and K. L. Hathi, for respondent No. 3.
The Judgment of the Court was delivered by Sikri, J.
This appeal by special leave is directed against.
the judgment of the High Court of Gujarat (Vakil, J.) allowing the application filed by Patel Raghav Natha, respondent before us and hereinafter referred to as the petitioner, and quashing the order dated October 12, 1961, passed by the Commissioner, Rajkot Division.
The Commissioner by this order had set aside the order of the Collector, dated July 2, 1960, granting permission to the petitioner to use some land in Survey No. 417 for non agricultural purposes.
In order to appreciate the contentions raised before us it is necessary to set out a few facts.
The petitioner was a resident of the State of Rajkot and at an auction effected by the State, he acquired on or about September 22, 1938, agricultural land bearing survey No. 417 which in all measured about 12 acres and 12 ganthas.
After some acquisitions by the State out of this survey number he was left with 2 acres and 10 ganthas of agricultural land.
On October 20, 1958, the petitioner applied to the Collector for permission to convert this land to non agricultural use, under section 65 of the Bombay Land Revenue Code, 1879, hereinafter referred to as the Code.
This petition was first rejected by the Collector, but the Divisional Commissioner remanded the matter to the Collector.
On remand, the then Collector of Rajkot, after holding an enquiry, granted permission to the petitioner to use the land for non agricultural use by his order dated July 2, 1960.
Pursuant to this order a sanad was issued by the Collector to the petitioner on July 27, 1960.
It appears that the sanad was amended on November 3, 1960 and December 1, 1960.
The sanad was in form MI and a number of conditions were appended to the sanad.
Condition 6 of the main sanad provided that "save as herein provided, the grant shall be subject to the provisions of the said code." The special conditions originally included a condition that the land shall be used exclusively for constructing residential houses (condition 5) but this condition was altered in November 1960.
It appears that the Municipal Committee of Rajkot had ob jected to the grant of permission before the Collector when a sketch of the land was sent to the Municipality.
The objections as they appear from the order of the Collector granting the sanad were directed against the accuracy of the sketch, showing the 337 northern and tile western comers of the Ramkrishna Ashram, and regarding the boundaries and situation of the roads in survey Nos. 417 and 418.
The Collector had overruled these objections.
The Municipal Committee approached the Commissioner to exercise powers under section 211 of the Code.
The Commissioner noted the objections of the Municipality and after reciting the objections and the arguments of the learned counsel for the petitioner and after inspecting the site, observed : "From this inspection the contentions of the Municipality as to the existence of the various roads as well as the nature of the Kharaba land has been proved beyond doubt.
In light of the above arguments as well as the site inspection and the papers of the case, I set aside the order of the Collector granting N.A. Permission.
I consider, on weighing all evidence cited above, that the land does not belong to Shri Raghav Natha.
" It is this order which has been quashed by the High Court.
The following grounds were urged before the learned Judge (1) The Commissioner or the State Government had no authority under Section 211 of the Code to revise the order of the Collector so as to affect the agreement or sanad granted to him.
(2) The Commissioner 's order is not a speaking order as no reasons are given by him for setting aside the Collector 's order and, therefore, it should be quashed.
(3) The question of title to the land was not in controversy at all before the Collector and, therefore, it was not open to the Commissioner to permit the Municipality to agitate that question and the Commission had no jurisdiction to decide that question.
(4) In case the above points are not accepted, the order of the Commissioner is bad even on merits as the Commissioner had erred in law in allowing the question to be agitated before him which were not agitated before the Collector and which involved considerations which were completely foreign to those which were actually before the Collector.
While dealing with ground No. 1 the learned Judge held that the Commissioner had no jurisdiction to pass an order which would nullify the sanad, and that the sanad was binding on both the parties till it was set aside in due course of law.
On the second 338 ground he held that there was some force in the submission.
But he observed : "But at the same time if I had to decide this case on this contention raised, I may not have interfered only on this ground, with the decision of the Commissioner".
On the third ground he found that it was true that the question of title was agitated by the Municipal Committee for the first time before the Commissioner, though it was primarily for the petitioner to show that he was an occupant within the meaning of section 65 of the Code.
But then the learned Judge decided not to enter into the merits of the case as he had come to the clear conclusion that the Commissioner had no authority to pass the order that he did under section 211 of the Code.
The learned counsel for the State of Gujarat, Mr. Dhebar, challenges the decision of the High Court that the Commissioner had no jurisdiction to pass the order dated October 12, 1961.
The relevant provisions of the Code and the Land Revenue Rules, 1921, hereinafter referred to as the Rules, are as follows "The Bombay Land Revenue Code, 1879 48.
(1) The land revenue leviable on any land under the provisions of this Act shall be assessed, or shall be deemed to have been assessed, as the case may be, with reference to the use of the land (a) for the purpose of agriculture, (b) for the purpose of building, and (c) for a purpose other than agriculture or building.
(2) Where land assessed for use for any purpose is used for any other purpose, the assessment fixed under the provisions of this Act upon such land shall, notwithstanding that the term for which such assessment may have been fixed has not expired, be liable to be altered and fixed at a different rate by such authority and subject to such rules as the State Government may prescribe in this behalf.
(3) Where land held free of assessment on condition of being used for any purpose is used at any time for any other purpose, it shall be liable to assessment.
(4) The Collector or a survey officer may, subject to any rules made in this behalf under section 214, prohibit the use for certain purposes of any unalienated 339 land liable to the payment of land revenue, and may summarily evict any holder who uses or attempts to use the same for any such prohibited purpose.
An occupant of land assessed or held for the purpose of agriculture is entitled by himself, his servants, tenants, agents, or other legal representatives, to erect farm buildings, construct wells or tanks, or make any other improvements thereon for the better cultivation of the land, or its more convenient use for the purpose aforesaid.
But, if any occupant wishes to use his holding or any part thereof for any other purpose the Collector 's permission shall in the first place be applied for by the occupant.
The Collector, on receipt of such application, (a) shall send to the applicant a written acknowledgment of its receipt, and (b) may, after due inquiry, either grant or refuse the permission applied for : Provided that, where the Collector fails to inform the applicant of his decision on the application within a period of three months, the permission applied for shall be deemed to have been granted; such period shall, if the Collector sends a written acknowledgment with in seven days from the date of receipt of the application, be reckoned from the date of the acknowledgment, but in any other case it shall be reckoned from the date of receipt of the application.
Unless the Collector shall in particular instances otherwise direct, no such application shall be recognized except it be made by the occupant.
When any such land is thus permitted to be used for any purpose unconnected with agriculture it shall be lawful for the Collector, subject to the general order of the State Government, to require the payment of a fine in addition to any new assessment which may be leviable under the provisions of section 48.
If any such land be so used without the permission of the Collector being first obtained, or before the expiry of the period prescribed by section 65, the occupant and any tenant, or other person holding under or through him, shall be liable to be summarily evicted by the Collector from the land so used and from the entire 340 field or survey number of which it may form a part, and the occupant shall also be liable to pay, in addition to the new assessment which may be leviable under the provisions of section 48 for the period during which the said land has been so used, such fine as the Collector may, subject to the general orders of the Provincial Government, direct.
Any tenant of any occupant or any other person holding under or through an occupant, who shall without the occupant 's consent use any such land for any such purpose, and thereby render the said occupant liaable to the penalties aforesaid, shall be responsible to the said occupant in damages.
Nothing in the last two preceding sections shall prevent the granting of the permission aforesaid on such terms or conditions as may be prescribed by the Collector, subject to any rules Made in this behalf by the Provincial Government." "Land Revenue Rules, 1921 87. (a) Revision of non agricultural assessment (b) When land is used for non agricultural purposes is assessed under the provisions of rules 81 to 85, a sanad shall be granted in the Form M if the land is used for building purposes, in Form NI if the land is used temporarily for N A purposes other than building in Form N in all other cases.
Provided that if the land to be used for building purposes is situated within the limits of a municipal corporation constituted under the Bombay Municipal Corporation Act or the Bombay Provincial Municipal Corporation Act, 1949 the Sanad shall be granted in Form M 1;. .
The relevant extracts from the agreement (sanad) are given below : Whereas application has been made to the Collector (hereinafter referred to as 'the Collector ' which expression shall include any officer whom the Collector shall appoint to exercise and perform his powers and duties under this grant) under section 65 of the Bom bay Land Revenue Code 1879 (hereinafter referred to as 'the said Code ' which expression shall where the context so admits include the rules and orders thereunder) by inhabitant of Madhya Saurashtra being the registered occupant of survey No. 417 in the village of 341 in the Taluka (hereinafter referred to as 'the applicant ' which expression shall where the context so admits include his heirs, executors, administrators and assigns) for permission to use for building purposes the plot of land (hereinafter referred to as the 'said plot '), described in the first schedule hereto and indicated by the letters. on the site plan annexed hereto, forming part of survey No. 417 and measuring acres 2 gunthas 17, be the same a little more or less.
When used under rule 51 for land already occupied for agricultural purposes within certain surveyed cities the period for which the assessment is leviable will be ordered to coincide with the expiry of 99 years ' period running in that city.
Now this is to certify that permission to use for building purposes, the said plot is hereby granted subject to the provisions of the said code, and on the following conditions, namely : (1) Assessment. (6) Code provisions applicable ': Save except as herein provided, the grant shall be subject to the provisions of this code In witness whereof the Collector of has set his hand and the seal of his office on behalf of the Governor of Bombay, and the applicant has also here unto set his hand, this day the of 19 .
Signature of Applicant Signature and designations of witnesses Signature of Collector Signature and designations of witnesses We declare that who has signed this notice is, to our personal knowledge, the person he represents himself to be, and that he has affixed his signature hereunto in our presence.
" It will be noticed that application is made under section 65 of the Code and it is under section 65 that the Collector either grants or refuses the permission applied for.
It will be further noticed that if the Collector fails to inform the applicant of his decision on the application within a period of three months the permission applied for shall be deemed to have been granted, but if the Collector sends a written acknowledgment within seven days from the date of receipt of the application then the three months period is reckoned from the date of acknowledgment, and in other cases this period is reckoned from the date of receipt of the supCI/69 8 342 application.
The Collector having given permission under section 65 he can prescribe conditions under section 67 of the Code.
Under section 48(2) where the land assessed for use, say for agricultural purposes, is used for industrial purposes, the assessment is liable to be altered and fixed at a different rate by such authority and subject to such rules as the State Government may prescribe in this behalf.
The rates for non agricultural assessment are fixed under rr. 81, 82, 82A, 82AA, 84 and 85 of the Rules.
Rule 87(b) provides that where land is assessed under the provisions of rr.
81 to 85, a sanad shall be granted.
Under the proviso to r. 87 (b) it is obligatory for the sanad to be granted in form MI.
Relying on Shri Mithoo Shahani vs Union of India(1) the learned counsel contends that there is a distinction between an order granting permission under section 65 and the agreement contained in the sanad which is issued under, r. 87 (b).
He urges that even if the sanad may not be revisable under section 211 of the Code, the order granting permission under section 65 is revisable under section 21 1, and if this order is revised the sanad falls along with the order.
We need not give our views on this alleged distinction for two reasons; first, that this point was not debated before the High Court in this case or in earlier cases**, and secondly, because we have come to the conclusion that the order of the Commissioner must be quashed on other grounds.
Section 211 reads thus "211.
The State Government and any revenue officer, not inferior in rank to an Assistant or Deputy Collector or a Superintendent of Survey, in their respective departments, may call for and examine the record of any inquiry or the proceedings of any subordinate revenue officer, for the purpose of satisfying itself or himself, as the case may be, as to the legality or property of any decision or order passed, and as to the regularity of the proceedings of such officer.
The following officers may in the same manner call for and examine the proceedings of any officer subordinate (1) ; (1) The Government of the Province of Bombay vs Hormusji Manekji (1940) Letters Patent Appeal No. 40 of 1938, decided on August 8, 1940.
(2) The Government of Bombay vs Mathurdas Laljibhai Gandhi 44 B.L.R. 405.
(3) The State of Bombay vs Chhaganlal Gangaram Lavar 56 B.L.R. 1084.
(4) Government of Bombay vs Ahmedabad sarangpur mills Co. A.I.R. (5) Secretary of State vs Anant Nulkar 36 B.L.R. 242 (P.C.) (6) Province of Bombay vs Hormusji Manekji 50 B.L.R. 524 (P.C.).
343 to them in any matter in which neither a formal nor a summary inquiry has been held, namely,. a Mam latdar, a Mahalkari, an Assistant Superintendent of Survey and an Assistant Settlement Officer.
If in any case it shall appear to the State Government or to such officer aforesaid that any decision or order or proceedings so called for should be modified, annulled or reversed, it or he may pass such order thereon as it or he deems fit; Provided that an Assistant or Deputy Collector shall not himself pass such order in any matter in which a formal inquiry has been held, but shall submit the record with his opinion to the Collector, who shall pass such order thereon as he may deem fit.
" The question arises whether the Commissioner can revise an order made under section 65 at any time.
It is true that there is no period of limitation prescribed under section 211, but it seems to us plain that this power must be exercised in reasonable time and the length of the reasonable time must be determined by the facts of the case and the nature of the order which is being revised.
It seems to us that section 65 itself indicates the length of the reasonable time within which the Commissioner must act under, section 21 1.
Under section 65 of the Code if the Collector does not inform the applicant of his decision on the application within a period of three months the permission applied for shall be deemed to have been granted.
This section shows that a period of three months is considered ample for the Collector to make up his mind and beyond that the legislature thinks that the matter is so urgent that permission shall be deemed to have been granted.
Reading sections 211 and 65 together it seems to us that the Commissioner must exercise his revisional powers within a few months of the order of the Collector.
This is reasonable time because after the grant of the permission for building purposes the occupant is likely to spend money on starting building operations at least within a few months from the date of the permission.
In this case the Commissioner set aside the order of the 'Collector on October 12, 1961, i.e. more than a year after the order, and it seems to us that this order was passed too late.
We are also of the opinion that the order of the Commis sioner should be quashed on the ground that he did not give any reasons for his conclusions.
We have already extracted the passage above which shows that after reciting the various contentions he badly stated his conclusions without disclosing 344 his reasons.
In a matter of this kind the Commissioner should indicate his reasons, however, briefly, so that an aggrieved party may carry the matter further if so advised.
We are also of the opinion that the Commissioner should not have gone into the question of title.
It seems to us that when the title of an occupant is disputed by any party before the Collector or the Commissioner and the dispute is serious the appropriate course for the Collector or the Commissioner would be to refer the parties to a competent court and not to decide the question of title himself against the occupant.
In the result the appeal is dismissed with costs.
V.P.S. Appeal dismissed.

summary/full:
The respondent, who was an occupant of agricultural land applied to the Collector, under section 65 of the Bombay Land Revenue Code, 1879, for permission to convert the land to non agricultural use.
The Collector gave the permission in July 1960 on condition that the land shall be used exclusively for constructing residential houses.
The Municipal Committee, which had objected to the grant of permission before the Collector, moved the Commissioner for exercising his powers under section 211 of the Code.
The Commissioner, in October, 1961, passed an order in which, after reciting the objections of the Municipality and the arguments of counsel he boldly stated his conclusion that the land did not belong to the respondent and set aside the Collector 's order without giving any reasons.
The Com missioner 's order was quashed by the High Court on the ground that the Commissioner had no authority to pass the order under section 211 of the Code.
In appeal to this Court, HELD : The Commissioner 's order was rightly quashed.
(a) Under section 65 of the Code, if the Collector does not inform an applicant of his decision on the application, within a period of 3 months, the permission applied for shall be deemed to have been granted Though no such period is prescribed by section 211, reading the two sections together it must be held that the Commissioner also must exercise his revisional powers within a reasonable time of the Collector 's order.
What is reasonable would depend on the facts of the case.
In the case when the permission is for building purposes, the Commissioner should exercise his power within a few months of the Collector 's order, because, after the grant of the permission the occupant is likely to spend money on building operations within a few months of the date of permission.
Since the order of the Commissioner in the present case was passed more than a year after the Collector 's order, the order should be set aside.
[343 E H] (b) The order should also be quashed on the ground that the Commissioner had not given any reasons for his conclusions.
[343 H] (c) The Commissioner also erred in going into the question of title, because, when there was a serious dispute regarding title, he should have referred the parties to a competent court and not decide it himself.
[344 D]


judgement:
Appeal No. 1020 of 1966.
Appeal by special leave from the judgment and order dated October 28, 1965 of the Allahabad High Court, Lucknow Bench in Second Appeal No. 356 of 1964.
R. K. Garg and D. P. Singh, for the appellant.
section section Shukla, for respondent No. 1.
The Judgment of the Court was delivered by Mitter, J.
The only question in this appeal by special leave is, whether there was a violation of Rule 7 of the United Provinces Legislative Department Rules in the appointment of the first respondent, section N. Dixit, as the Superintendent in the Legislative Assembly of the State of Uttar Pradesh in preference to the appellant.
The facts are as follows.
The appellant was appointed as an Upper Division Assistant (formerly known as superior service assistant) in the Legislative Assembly Secretariat Uttar Pradesh in 1954 on the result of a competitive examination held by the Public Service Commission of the State.
He was confirmed in the post of Upper Division Assistant with effect from June 16, 1955.
In September 1961 a vacancy occurred in the post of a Superintendent in the Legislative Assembly Secretariat.
The first respondent was working as a Treasurer in the same office.
According to the appellant, one Uma Shanker was the senior Upper Division Assistant and he was immediately after Uma Shanker in order of seniority.
In view of the fact that Uma Shanker had not put in the minimum period of ten years ' service as Upper Division Assistant the Speaker of the Assembly did not think it fit to appoint him as Superintendent but he ignored the appellant 's claim to the post after Uma Shanker and appointed Dixit in violation of the mandatory provisions of Rule 7.
The said Rule reads : "Recruitment to the post of the Superintendent shall be made by promotion from the grade of superior service assistants in the Council Department.
While due regard will be paid to seniority, no assistant will be appointed to the post of Superintendent unless he is considered qualified in all respects to perform the duties of a Superintendent and full authority will be reserved to appoint the assistant most fitted for the post.
If, 423 however, no suitable assistant is available for promotion from amongst the grade of superior service assistants in the Council Department, recruitment may, as a special case, be made from outside.
" The appellant filed a suit in the court of the Munsif of South Lucknow impleading the State of Uttar Pradesh, the Speaker, Legislative Assembly of the State and Dixit as defendants therein and praying for a decree for declaration that he should be deemed entitled to the post of Superintendent in the Legislative Assembly with effect from 1st January 1962 and a further declaration that the order dated October 7, 1961 appointing defendant No. 3 as Superintendent was illegal and ultra vires.
Written statements were filed on behalf of the defendants.
The learned Munsif held in the,plaintiff 's favour.
His judgment was upheld in appeal by the Civil Judge Lucknow.
The same was reversed in Second Appeal to the High Court.
The order of the Speaker passed in October 1961 shows that he had considered the matter carefully before appointing Dixit to the post.
The contention of learned counsel for the appellant was 'that the post could not be given to a person who was not a superior service Assistant and the "grade of superior service assistants in the Council Department" meant and included only those persons whose names were borne on the roll of Upper Division Assistants.
exhibit 10 the gradation list of permanent ministerial establishment of the Uttar Pradesh Legislative Assembly Secretariat as it stood in April 1956 shows.
that the scales of pay of Upper Division Assistants, Translators, Reference Clerk, Treasurers, Stenographer to Secretary and Assistant Librarian were the same, namely, Rs. 160 15 280 EB 20 400.
By an order of the Governor dated March 16, 1959 efficiency bars in the scales of pay of all the above posts were uniformly altered and fixed at Rs. 220 and Rs. 300.
The High Court took the view that 'grade ' in R. 7 was suggestive of status and it did not refer to a class or a particular class.
According to the High Court "All officials working in the same scale of pay in a department, although holding posts with different desig nations, shall be deemed to be holding posts in the same grade, because their rank in the same.
department will be the same and equal to one another.
" The High Court noted that the dictionary meaning of "grade" was 'rank ' position in scale, a class or position in a class according to the value. ' In our view the High Court came to the correct conclusion in holding that the post was a selection post and seniority by itself was not a sufficient qualification for promotion.
The Speaker had to take into consideration the claims of Senior.
424 Upper Division Assistants but under the rules his choice was not limited to the Upper Division Assistants.
He could consider the claims of others who were in the same grade, that is to say, enjoying the same scales of pay and pick out the person considered by him to be qualified in all respects to perform the duties of a Superintendent.
All officials of the Legislative Assembly Secretariat holding posts in the same scale of pay as Upper Division Assistants were eligible for promotion to the post of the Superintendent Counsel argued that this would be an unreasonable interpre tation of the rule for in that case even a book binder or a chauffeur would have to be considered if their scales of pay were the same as those of Upper Division Assistants.
We do not think that anyone would place such an absurd construction on the rule.
The appointing authority had to consider not only the eligibility based on the grade (assuming that the rules unreasonably place a chauffeur, a book binder, an accountant and a special duty clerk in the same grade) but also the qualification of the person appointed to perform the duties of the Superintendent and a book binder or a chauffeur would certainly not be eligible for ,consideration.
It was said that the educational qualification of the appellant was much superior to that of Dixit and while the appellant had joined service by passing a competitive examination held by the Public Service Commission the first respondent had failed to pass such a test.
These are matters on which we can express no opinion.
As noted already, the Appointment was made after a thorough scrutiny of representations received and after consideration of the recommendation made by the Secretary ,of the Legislative Department.
In the result the appeal is dismissed, but we make no order as to costs.
G.C. Appeal dismissed.

dataset_name: IN-Abs

summary/full:
According to r. 7 of the United Provinces Legislative Department Rules recruitment to the post of Superintendent shall be made by promotion from 'the grade of superior service assistants in the Council Department '.
While regard was to be shown to seniority full authority was reserved to appoint the assistant most fitted for the post and when no suitable assistant was available recruitment might be made from outside.
The appellant entered the service of the U.P. Legislative Assembly in 1954 through a competitive examination held by that Public Service Commission of the State.
In 1955 he was confirmed in the post of Upper Division Assistant.
In September, 1961 a vacancy occurred in the post of a Superintendent in the Legislative Assembly Secretariat.
The first respondent who was working as a Treasurer in the same office in the same scale of pay as the appellant was appointed to the said post by the Speaker of the Assembly.
Being aggrieved by the rejection of his claim as the senior qualified superior service assistant the appellant filed a suit in the court of the Munsif.
The Munsif decreed the suit in his favour but the District Judge in first appeal and the High Court in second appeal decided against him.
According to the view taken by the High Court the word 'grade ' in r. 7 meant the scale of pay, and therefore all persons on the same scale of pay as a superior service assistant were qualified for the post of Superintendent in whichever department and under whatever designation they might be working.
In appeal by special leave before this court, HELD : The post of Superintendent was a selection post and seniority by itself was not a sufficient qualification.
The Speaker had taken into consideration the claims of the senior Upper Division Assistants but under the rules his choice was not limited to the Upper Division Assistants.
He could consider the claims of others who were in the same grade, that is to say, enjoying the same scale of pay and pick out the person considered by him to be qualified in all respects to perform the duties of a Superintendent.
The High Court bad rightly held that all officials of the U.P. Legislative Assembly Secretariat holding posts in the same scale of pay as Upper Division Assistants were eligible for promotion to the post of Superintendent.
[423H 424B] The danger that on the above interpretation persons like book binders and chauffeurs, if they were getting a salary in the game grade as the senior service assistants would be eligible for the post, was imaginary, for in making appointment to a selection post the qualifications of a person would certainly have to be considered.
[424D] The fact that the appellant entered service through a competitive examination while the respondent had failed to pass such a test was not one SupCI/69 13 422 which could be taken into consideration by this Court because the appointment was made after thorough scrutiny of representations received and after consideration of the recommendation made by the Secretary of the Legislative Department.
[424E]


judgement:
Civil Appeal No. 556 of 1966.
283 Appeal by special leave from the order dated August 13, 1964 of the Industrial Tribunal, Andhra Pradesh in Industrial Dispute No. 41 of 1963.
M.K. Ramamurthi, Shyamala Pappu and Vineet Kumar, for the appellants.
K. Srinivasamurthy and Naunit Lal, for the respondent.
The Judgment of the Court was delivered by Bhargava, J.
This appeal, by special leave, has arisen out of an award made 'by the Industrial Tribunal, Andhra Pradesh, at Hyderabad in an industrial dispute between the respondent, the Imperial Tobacco Co., as well as exporting the tobacco to various (hereinafter referred to as "the Company"), and its workmen.
Admittedly, the Company is an associate of the Imperial Tobacco Company Ltd., and the main business carried on by the Company is that of purchasing tobacco of all varieties and qualities, stemming, grading and packing of tobacco and supplying it to the Imperial Tobacco Co., as well as exporting the tobacco to various foreign countries in the world.
The Company has been carrying on this business for about 40 years and handles almost 35 per cent of the tobacco grown in the State of Andhra Pradesh.
For the work of stemming, grading and packing tobacco, the Company has two factories, one at Anaparty in East Godavari District, and the other at Chirala in Guntur District.
In connection with this business, the Company, in the year 1962, was maintaining 21 depots where, according to the workmen, the appellants, the Company was carrying on the work of collecting tobacco, though the Company 's case was that the principal work done at these depots was that of handling the tobacco purchased at other places and only included the work of purchasing tobacco on a small scale.
On 16th August, 1963, the Company gave a notice to the Union of the appellant workmen that 8 out of 21 depots mentioned therein would be closed down with effect from 30th September, 1963.
Thereafter, an industrial dispute was raised by the workmen which related to the closure of these 8 depots, as well as to a number of other demands, including revision of basic wages and dearness allowance, additional discomfort allowance, etc.
The State Government, by its Order dated 14th November, 1963, referred the dispute for adjudication under section 10(1)(d) of the to the Industrial Tribunal, Hyderabad.
The first issue which was referred for adjudication, was as follows : "How far the demands of the union, viz., (i) that no depot which worked during 1962 season should.
be closed, and (ii) that no workman who worked in 1962 season 'should be retrenched, are justified ?" 284 There were ten other issues, but we need not reproduce them, as we are not concerned with them in this appeal.
In the proceedings for adjudication, the Company took a preliminary objection that the closure the depots was a managerial function, that there could not be an industrial dispute over such closure, that the Government, therefore, had no power to refer this issue for adjudication, and that the Tribunal also had no power to adjudicate on it.
Thereupon, the Tribunal framed a .preliminary issue as to "whether the employer is justified in alleging that Issue No. 1 framed by the Government cannot be deemed to relate to an industrial dispute, and as such, whether the Government had the power to refer it for adjudication".
The Tribunal decided this preliminary issue by giving an interim award on the 13th August, 1964.
The preliminary objection was allowed and a further direction was made that the effect of this decision on Issue No. 1 will be decided later after hearing the parties, There,after, the Tribunal proceeded to hear the reference on this question as well as on all other issues referred to it and ', ultimately, gave its award on 11th December, 1964.
In that award, both the parts of issue No. 1 were decided against the workmen.
The workmen have now come up in this appeal against the interim award dated 13th August, 1964 as well as against the final award insofar as it relates to issue No. 1.
The decision given by the Tribunal in the interim award, holding that the reference covered by issue No. 1 was not competent, has been challenged by learned counsel for the appellants on the ground that the closure of a depot does not amount to closure of business in law and, since the same business was continued by the Company at at least 13 other depots, the closure of the 8th depots in question was unjustified.
For the proposition that the closure of the depots did not amount to closure of business, learned counsel rolled on the views expressed by this Court in Pipraich Sugar Mills Ltd. vs Pipraich Sugar Mills Mazdoor Union(1), where the Court explained the reason for the decision given by the Labour Appellate Tribunal in the case of Employees of Messrs India Reconstruction Corporation Limited, Calcutta vs Messrs. India Reconstruction Corporation Ltd., Calcutta(2).
It, however, appears to us that this question raised on behalf of the appellants is totally immaterial insofar as.
the question of the jurisdiction of the Tribunal to decide the first part of issue No. 1 is concerned.
The closure of the 8 depots by the Company, even if it is held not to amount to closure of business of the Company, cannot be interfered with by an Industrial Tribunal if, in fact, that closure was genuine and real.
The closure may be treated as stoppage of part of the activity or business of the Company.
Such stoppage of part of a (1) (2) 63.
285 business is an act of management which is entirely in the discretion of the Company carrying on the business.
No Industrial Tribunal, even in a reference under section 10(1)(d) of the , can interfere with discretion exercised in such a matter and can have any power to direct a Company to continue a part of the business which the Company has decided to shut down.
We cannot possibly accept the submission made on behalf of the appellants that a Tribunal under the has power to issue orders directing a Company to reopen a closed depot or branch, if the Company, in fact, closes it down.
An example may be taken of a case where a Bank with its headquarters in one place and a number of branches at different places decides to close down one of the branches at one of those places where it is functioning.
We cannot see how, in such a case, if the employees of that particular branch raise an industrial dispute, the Bank can be directed by the Industrial Tribunal to continue to run that branch.
It is for the Bank to decide whether the business of the branch should be continued or not, and No. Bank can be compelled to continue a branch which it considers undesirable to do.
In these circumstances, it is clear that the demand contained in the first part of Issue No. 1 was beyond the powers and jurisdiction of the Industrial Tribunal and was incorrectly referred.
for adjudication to it by the State Government.
of course, if a Company closes down a branch or a depot, the question can always arise as to the relief to which the workmen of that branch or depot are entitled and, if such a question arises and becomes the subject matter of an industrial dispute, an Industrial Tribunal will be fully competent to adjudicate on it.
It is unfortunate that, in this case, when dealing with the preliminary issue, the Tribunal expressed its decision in the interim award in general words holding that Issue No. 1 as a whole was beyond its jurisdiction.
If the reasoning in the interim award is taken into account, it is dear that the Tribunal on that reasoning only came to the conclusion that it was not competent to direct reopening of the 8 depots which had been closed, so.
that the Tribunal should have held that the first part of Issue No. 1 only was outside its jurisdiction.
So far as the second part of that issue is concerned, as we have said above, it was competent for the Tribunal to go into it and decide whether the claim of the workmen that they should not be retrenched was justified.
On an examination of the interim award and the final award, we, however, find that the Tribunal in fact did (1) 286 do so.
The case reported in Pipraich Sugar Mills Ltd.(1) was also concerned only with the question as to the relief that can be granted to workmen when there is closure of a business.
No question arose either before the Court, or in the cases considered by the Court, of an Industrial Tribunal making a direction to the employers to continue to run or to reopen a closed branch of the business.
The Labour Appellate Tribunal in the case of Employees of Messrs India Reconstruction Corporation Ltd., Calcutta(1) was dealing with the question of retrenchment compensation as a result of the closure of one of the units of the company concerned, and it held that the workmen were entitled to retrenchment compensation in accordance with law.
This Court, in the case of Pipraich Sugar Mills Ltd. (2), only explained why the Labour Appellate Tribunal was justified in granting retrenchment compensation in that case.
The opinion expressed by the Court was that, though there is discharge of workmen both when there is retrenchment and closure of business, the compensation is to be awarded under the law no.t for discharge as such but for discharge on retrenchment and if, as is conceded, retrenchment means in ordinary parlance discharge of the surplus, it cannot include discharge on closure of business.
It was in this context that the Court went on to add that in the case of Employees of M/s. India Reconstruction Corporation Ltd., Calcutta (1 ) what had happened was that one of the units of the Company had been closed which would be a case of retrenchment and not a case of closure of business.
It may be noted that, at the time when this decision was given, section 25FF and section 25FFF had not been introduced in the , and the only right to retrenchment compensation granted to the workmen was conferred by section 25F.
It was in the light of the law then prevailing that the Court felt that the decision of the Labour Appellate Tribunal in the case of Employees of M/s. India Reconstruction Corporation Lid(1) granting retrenchment compensation.
could be justified on the ground that the services of the workmen had not been dispensed with as a result of closure cf business, but as a result of retrenchment.
That question does not arise in the case before us.
Since then, as we have indicated above, section 25FF and section 25FFF have been added in the , and the latter section specifically lays down what rights a workman has when an undertaking is closed down.
In a case where a dispute may arise as to whether workmen discharged are entitled to compensation under section 25F of section 25FFF it may become necessary decide Whether the closure, as a result of which the services have been dispensed with, amounts to a closure in law or not.
In the case before us, it was admitted by 1earned counsel for both parties that the workmen, who have been discharged as a result of the closure of the 8 depots (1) (2) 287 of the Company, have all been paid retrenchment compensation at the higher rate laid down in section 25F, so that, in this case, it is not necessary to decide the point raised on 'behalf of the workmen.
In connection with the second part of issue No. 1, it was also urged by learned counsel for the appellants that the business, which was being carried on at the 8 depots, had not in fact been closed down and had merely been transferred to buying points situated in and around the closed depots, including two new buying points established by the Company after the closure of these 8 depots.
The argument was that the workmen were old employees who had served the Company for a long time and were entitled to certain benefits as a result of that long service.
The Company closed these 8 depots mala fide with the object of depriving the workmen of those benefits.
and merely altered the nature of the business by closing the depots and carrying on the stone business at the buying points.
This point urged by learned counsel cannot, however, be accepted in view of the findings of fact recorded by the Tribunal.
The Tribunal examined in detail the allegations made on behalf of the workmen in this respect.
In fact, the interim award mentions that, for the purpose of deciding the preliminary issue and the first issue, evidence was recorded by the Tribunal for more than a week and arguments of Advocates of the parties were heard for even a longer period.
After examining the evidence, the Tribunal came to the conclusion that the stoppage of the work at the depots was genuine and that the work which was being carried on at the depots had not been transferred to the buying points established by the Company.
The closure of the business at the depots was necessitated by reasons of expediency inasmuch as the Company had to reduce its purchases in its quest for quality and its 'desire to run the business economically.
The principal work, which used to be done at the depots, was not that of purchasing tobacco, but of handling it and that work was not transferred at all to, any buying point.
The Tribunal, thus, came to the finding that the closure of these depots was real and genuine and that the suggestion of the appellants that only a device was adopted of carrying on the same business in a different manner had no force at all.
if the same business had been continued, though under a different guise, the claim of the workmen not to be retrenched could possibly be considered by the Tribunal; but, on the finding that there was a genuine closure of the business that used to be carried on at the depots, no question could arise of the retrenchment being set aside by the Tribunal.
The Tribunal could not ask the Company to re employ or reinstate the workmen, because there was no business for which the workmen could be required.
In these circumstances all that the workmen 288 could claim was compensation for loss of their service and in that respect, as we have indicated above, the workmen have received adequate compensation.
Consequently, the appeal has no force and is dismissed but we make no order as to.
costs.
V.P.S. Appeal dismissed.
L2 S.C.I./69 2,500 6 I 70 GIPF.

summary/full:
The respondent was carrying on the business of purchasing, handling and selling tobacco.
In 1962, it was maintaining 21 depots where the principal work was handling tobacco and the work of purchasing was done on a small scale.
In 1963, it gave notice that 8 out of the 21 depots would be closed down.
An industrial dispute was raised by the workmen and the demands off the workmen, namely: (1) that no depot worked during 1962 should be closed; and (2) no workman who worked in 1962 should be retrenched, were referred to the Industrial Tribunal.
The Tribunal held that the stoppage of work at the 8 depots and the closure was genuine and real, that there was no transfer of the work that was being carried on at those depots to other buying points established by the respondent, and repelled the suggestion of the appellants that it was a mala fide device adopted for carrying on the same business in a different manner, and decided both the issues against the workmen.
In appeal to this Court, HELD ': (1) A genuine closure of depots or branches, even though it did not amount to.
closure of the business could not be interfered with by an Industrial Tribunal, and therefore, the issue was incorrectly referred by the Government for adjudication by the Tribunal.
The closure is stoppage of p.art of the activity or business of the respondent.
Such stoppage is an act of management which is entirely in the discretion of the respondent and n0.
Industrial Tribunal can interfere with the discretion exercised in such a matter, or can have the power to direct the respondent to continue a part of the 'business which it had decided to shut down.
or direct it to reopen a closed depot or branch.
[284 G H; 285 A C] (2) On that finding, no question could arise of the retrenchment being set aside by the Tribunal, because, there was no business for which the workmen would be required.
All that the workmen could claim was compensation for loss of the service, and, in a case where a dispute may arise as to whether workmen discharged are entitled t0 compensation under section 25F or section 25FFF, of the , it may become necessary to decide whether the closure amounts to closure in law or not.
But, in the present case, the workmen have all been paid retrenchment compensation at the higher rate laid down in section 25F and therefore, received adequate compensation.
[287 F H; 288 A]


judgement:
Appeal No. 712 of 1966.
Appeal by special leave from the order dated July 27, 1964 of the Madhya Pradesh High Court in Misc.
Petition No. 272 of 1964.
section C .
Chaturvedi, K. Mehta and M. V. Goswami, for the appellant.
I. N. Shroff, for the respondent.
The Judgment of the Court was delivered by Bachawat, J.
The appellant was a temporary Civil Judge in Madhya Pradesh.
On March 14, 1961 an order was issued in the name of the Governor of Madhya Pradesh State that the appellant "is appointed temporarily, until further orders, as Civil Judge", Rule 12 of the Madhya Pradesh Government Servants (Temporary and Quasi permanent Service) Rules, 1960 provided: 12(a) Subject to any provision contained in the order of appointment or in any agreement between the gov 474 ernment and the temporary government servant, the service of a temporary government servant who is not in quasi permanent service shall be liable to termination at any time by notice in writing given either by the government servant to the appointing authority or by the ap pointing authority to the Government servant; Provided that the services of any such government servant may be terminated forthwith by payment to him of a sum equivalent to the amount of his pay plus allowances for the period of the notice, or as the case may be, for the period by which such notice falls short of one month or any agreed longer period Provided further that the payment of allowances shall be subject to the conditions under which such allowances are admissible.
(b) The periods of such notice shall be one month unless otherwise agreed between the Government and the Government servant.
" On March 25, 1964 an order was issued by and in the name of the Governor terminating the appellant 's services.
The order stated : "The service of Shri Ram Gopal Chaturvedi, temporary Civil Judge, Waidhan, are terminated with effect from the 1st June 1964, forenoon." The appellant filed a writ petition in the Madhya Pradesh High Court for quashing the order dated March 25, 1964.
The High Court summarily dismissed the petition.
It held that the impugned order was not by way of punishment and that the appellant 's services were liable to be terminated under the aforesaid rule 12 on one month 's notice.
The appellant has filed the present appeal after obtaining special leave.
The appellant was a temporary government servant and was not in quasi permanent service.
His services could be terminated on one month 's notice under r. 12.
There was no provision in the order of appointment or in any agreement that his services could not be so terminated.
Counsel for the appellant submitted that rule 12 was uncon stitutional as it was framed without consulting the State Public Service Commission and the High Court.
The contention raises mixed questions of law and fact.
It was not raised in the High 475 Court, and we indicated in the course of arguments that the appellant could not be allowed to raise it in this Court for the first time.
Counsel next submitted that rule 12 was violative of articles 14 and 16 of the Constitution.
There is no merit in this contention.
Rule 12 applies to all temporary government servants who are not in quasi permanent service. 'All such government servants are treated alike.
The argument that rule 12 confers an arbitrary and unguided discretion is devoid of any merit.
The services of a temporary government servant may be terminated on one month 's notice whenever the government thinks it necessary or expedient to do so for administrative reasons.
It is impossible to define before hand all the circumstances in which the discretion can be exercised.
The discretion was necessarily left to the gov ernment.
It was argued that the appellant 's services could not be terminated on one month 's notice as (a) his confirmation was recommended by the High Court after the expiry of the probationary period and (b) the advertisement dated September 9, 1960 inviting applications for the temporary posts (if civil judges did not specifically mentioned that their services could be so terminated.
The point that the High Court had recommended the appellant 's confirmation was not raised in the High Court and cannot be allowed to be, raised in this Court for the first time.
The appellant 's services were subject to the relevant rules and could be terminated on one month 's notice under rule 12.
It is immaterial that the advertisement did not specifically mentioned that his services could be so terminated.
It was argued that the impugned order was invalid as it was passed without consulting the State Public Service Commission under article 320(2)(c) of the Constitution.
There is no merit in this contention.
The case of State of U.P. vs M. L. Srivastava(1) decided that the provisions of article 320(3)(c) were not mandatory and did not confer any rights on the public servant and that the absence of consultation with the State Public Service Commission did not afford him a cause of action.
It was next argued that the impugned order was passed by way of punishment without giving the appellant an opportunity to show cause against the proposed action and was therefore violative of article 311 of the Constitution.
In this connection, counsel It for the appellant drew our attention to the statement of case filed on behalf of the respondent.
It appears that there were complaints (1) ; 476 that the appellant was associating with a young girl named Miss Laxmi Surve against the wishes of her father and other members of her family.
The Chief Justice of Madhya Pradesh made inquiries into the matter and on February 19, 1954 he admonished the appellant for this disreputable conduct.
On his return to Jabalpur on February 28, 1964 the Chief Justice dictated the following note: "During my recent visit to Gwalior, I probed into the matter of Shri R. G. Chaturvedi, Special Magistrate (Motor Venicles), Gwalior, giving shelter to a girl named Kumari Laxmi Surve, the daughter of a Chowkidar employed in the J. C. Mills Gwalior.
The enquiry made by me revealed that Shri Chaturvedi has been associating with this girl for over a year and his relations with her are not at all innocent.
He is sheltering and supporting Miss Surve against the wishes of her father and other members of her family.
This is evi dent from the fact that on 14th December 1963, when the girl was at the residence of Shri Chaturvedi and when her younger brother came to take her back, his house was stormed by a mob of 300 to 400 persons.
A report of this incident was also recorded in the Roz namcha Am of Lashkar Kotwali.
The statement published by Miss Surve in some newspapers published from Gwalior explaining his action and her relation with her parents is significant.
In that statement Miss Surve gave her address as 'C/o.
Shri Chaturvedi.
That the statement is one inspired by Shri Chaturvedi is obvious enough.
Shri Chaturvedi is still maintaining the girl.
Shri Chaturvedi did not enjoy good reputation at Morena and Kolaras where he was posted before his posting at Gwalior.
Shri Bajpai, District Judge, Gwalior, also informed me that Shri Chaturvedi was not honest and that in collaboration with the Traffic Inspector he has taken money from accused persons in many cases under the Motor Vehicles Act." No charge sheet was served on the appellant nor was any departmental inquiry held against him.
On March 1O, 1964 the Madhya Pradesh High Court passed a resolution that the State Government should terminate the appellant 's services.
Having regard to this resolution the State Government passed the impugned order dated March 25, 1964.
On the face of it, the order did not cast any stigma on the appellant 's character or integrity nor did it visit him with any evil consequences.
It was not passed by way of punishment and the provisions of article 311 were not attracted.
477 It was immaterial that the order was preceded by an informal inquiry into the appellant 's conduct with a view to ascertain whether he should be retained in service.
As was pointed out in The State of Punjab vs Sukh Raj Bahadur(1) : "An order of termination of service in unexceptionable form preceded by an enquiry launched by the superior authorities only to ascertain whether the public servant should be retained in service, does not attract the operation of Article 311 of the Constitution.
" It was next argued that the impugned order was in violation of the principles of natural justice and in this connection reliance was placed on the decision of this Court in State of Orissa vs Dr. (Miss) Binapani Dei & Ors.(2) and Ridge vs Baldwin(3).
In Binapani 's Case the appellant was an assistant surgeon in the Orissa medical service.
The State government accepted the date of birth given by her on joining the service.
Later the government refixed the date of her birth on ex parte inquiry and passed an order compulsorily retiring her.
The Court held that its order was invalid and was liable to be quashed.
The appellant as the holder of an office in the medical service had the right to continue in service.
According to the rules made under article 309 she could not be removed from the office before superannuation except for good and sufficient reasons.
The ex parte order was in derogation of her vested rights and could not be passed without giving her an opportunity of being heard.
In the present case, the impugned order did not deprive the appellant of any vested right.
The appellant was a temporary government servant and had no right to hold the office.
The State government had the right to terminate his services under rule 12 without issuing any notice to the appellant to show cause against the proposed action.
In Ridge vs Baldwin(3) the House of Lords by majority held that the order of dismissal of a chief constable on the ground of neglect of duty without informing him of the charge made against him and giving him an opportunity of being heard was in contravention of the principles of natural justice and was liable to be quashed.
Section 191 of the Municipal Corporations Act, 1882 provided that the watch committee might at any time suspend and dismiss any borough constable whom they thought negligent in the discharge of his duty or otherwise unfit for the same.
The chief constable had the right to hold his office and before depriving him of this right the watch committee was required to conform to the principles of natural justice.
The order of dismissal visited him with the loss of office and involved an element of punishment for the offences committed.
In the present case, the impugned order (1) ; (2) ; (3) ; 478 did not involve any element of punishment nor did it deprive the appellant of any vested right to any office.
It was next argued that the State Government blindly followed the recommendations of the High Court.
We find no merit in this argument.
The State government properly followed those recommendations.
The High Court is vested with the control over the subordinate judiciary, see The State of West Bengal vs N. N. Bagchi (1).If the High Court found that the appellant was not a fit person to be retained in service, it could properly ask the government to terminate his services.
Following the advice tendered by the High Court, the government rightly terminated his services under rule 12.
In the result, the appeal is dismissed.
There will be no order as to costs.
Y.P. Appeal dismissed.
(1)[1966] 1 S.C.R. 771.
LI 3Sup.
CI(NP)69 2,500 2 5 70 GIPF.

summary/full:
The appellant was appointed temporarily, to the judicial service in the respondent State.
On complaints, that the appellant was associating with a girl, and was taking bribes, the Chief Justice of the High Court enquired into, them and the High Court recommended to the State Government to terminate the appellant 's service.
The Government passed an order under r. 12 of the M. P. Government Servants (Temporary and Quasi permanent Service) Rules, 1960 stating only that the services of the appellant are terminated from a specified day.
The appellant filed a writ petition in the High Court against this order.
The High Court dismissed the petition.
in appeal, to this Court, the appellant contended that (i) r. 12 was violative of articles 14 and 16 of the Constitution as it conferred arbitrary and unguided discretion to the Government; (ii) the impugned order was as invalid as it was passed without consulting the State Public Service Commission under article 320(3)(c) of the Constitution; (iii) the order was passed by way of punishment without giving the appellant an opportunity to show cause against the proposed action and was therefore violative of article 311 of the Constitution; (iv) the order was in violation of the principles of natural justice, as no charge sheet was served nor any departmental inquiry held; and (v) the State Government erred in blindly following the recommendations of the High Court.
Repelling the contentions.
this Court, HELD : The appellant was a temporary government servant and was in not quasi permanent service.
His services could be terminated on one month 's notice under r. 12.
There was no provision in the order of appointment or in any agreement that his service could not be 'so terminated.
(i) Rule 12 applies to all temporary government servants who are not in quasi permanent service.
All such government servants are treated alike.
The agrument that r. 12 conferred an arbitrary and unguided discretion was devoid of any merit.
The services of a temporary government servant may be terminated on one month 's notice whenever the government thinks it necessary or expedient to do so for administrative reasons.
It was impossible to define before hand all the circumstances in which the discretion could be exercised.
The discretion was necessarily left to the government.
[475B] (ii) The provisions of article 320(3)(c) were not mandatory and did not confer any rights on the public servant and that the absence of consultation with the State Public Service Commission did not afford him a cause of action.
[475G] 473 State of U.P. vs M. L. Srivastava, ; , followed.
(iii) On the face of it, the order did not cast any stigma on the appellant 's character or integrity nor did it visit him with any evil consequences It was not passed by way of punishment and the provisions of article 311 were not attracted.
[476H] It was immaterial that the order was preceded by an informal inquiry into the appellant 's conduct with a view to ascertain whether he would be retained in service.
[477A] State of Punjab vs Sukh Rai Bahadur, ; , followed.
(iv) In the present case, the impugned order did not involve any element of punishment nor did it deprive the appellant of any vested right to any office.
The appellant was a temporary Government servant and had no Tight to hold the office.
The state government had the right to, terminate his servicess under r. 12 without issuing any notice to the appellant to, show cause against the proposed action.
[477H] (v) The government rightly terminated the services, following the advice tendered by the High Court.
The High Court is vested with the control over the subordinate judiciary.
If the High Court found that the appellant wits not a fit person to be retained in service, it could properly ask the government to terminate his services.
[478B] State of West Bengal vs N. N. Bagchi, [1966] 1 S.C.R. 771, followed.
State of Orissa vs Dr. (Miss) Binapani Dei & Ors. ; and Ridge vs Baldwsin, ; , referred to.